Supervisors of Julington Creek CDD reject call for audit

Letter: Supervisors of Julington Creek CDD reject call for audit

Tom O’Leary
St Johns, FL

Dear Editor:

From my research, the Julington Creek Community Development District, like most other CDD entities, was established as a mechanism for developers to issue tax-free bonds to construct improvements to the roads, utilities, storm water systems, parks and recreation areas.

The owners would, in turn, pay less up-front for the cost of their homes and pay off the bonds over 30 years. After the bonds were paid off the CDD would be dissolved and the CDD assessments would end for the residents.

Fast forward to today. We now have a $6.3 million dollar tax funded “business” where the bonds now only account for 29% of that budget, with the other 71% being used to operate and maintain what many consider to be a de-facto tax payer funded resort with high-end resort amenities, a staff of 200 that includes professional tennis, swim and skate pros, some of which are paid in excess of $160,000 annually, sports teams, an alcoholic bar with continual programing and other events that are subsidized by all the residents. It would be valuable to know what percentage of the household’s use the CDD programs and services, but the CDD refuses to update their systems to track that information.

Because the majority of CDD supervisors namely, Kannatt-Gapinski, Klein and Jacob, often vote together, they can and do disregard many of the concerns expressed by other Supervisors and residents. In my opinion, this has led to some miss-trust among board members and residents alike. This is curious given that their overriding duty is to fairly represent the best interests of ALL community residents.

A recent proposal by Supervisor Page illustrates just how unwilling the majority is at finding any middle ground. What should be a non-controversial procedure to verify the accuracy of all expenses; Supervisor Page recommended that a third party professional be hired to conduct an operational audit in order to determine if improvements to the CDD’s financial management of resources are available. A second objective for the audit was to identify procedures and processes to establish evidence-based policy making for the annual budget of about $6.3 million.

Supervisor Page expressed her concern about whether or not CDD decisions were being effectively implemented because there is little to no subsequent evaluation to determine what is, and is not, working. I agree. In my opinion, the community should insist that CDD decisions be made based only on hard data, not gut feeling and emotion. One glaring process needing change is to replace the all cash-based manual systems currently in use by many CDD departments with more effective cash management computer programs. This would significantly lessen the risk of waste and fraud.

Unfortunately, Supervisor Page’s audit proposal was strongly opposed by CDD Staff and Supervisors Kannatt-Gapinski, Klein and Jacob, so one can only assume they are not interested in knowing if the CDD could manage tax money more efficiently. This “fear of accountability” is concerning because it’s in every resident’s interest to consistently achieve the highest and best use of our all tax dollars expenditures. Regardless of the organization, saving money, and or, eliminating waste, is a best management practice. Why does our CDD board choose a non-verifiable operating structure?

All CDD Supervisors would benefit from a third party audit because either;

1) the audit will confirm to the community that the CDD is efficiently run or
2) areas in need of improvement are identified

Either outcome generates a win for all property owners within the CDD.

In addition to regular audits, all responsible organizations periodically conduct scientific customer surveys to obtain feedback on what is going well and to also seek input on possible areas of improvement. With so much controversy and disagreement among the five Supervisors, the residents deserve, and have a right to, the opportunity to influence the general direction of their CDD.

It’s time for an audit of current expenditures and a scientific resident survey to help the board chart the future for our community.