In the May 2023 edition of our monthly newsletter, I discussed my concerns about the $30 million transfer to the State Veteran Services for the development of the Veteran’s Nursing Home as requested by the Collier County Board of County Commissioners. One major concern I had with this funds transfer was the lack of a guaranteed interest rate stated in the Escrow Agreement. Considering that the $30 million funding was taken from the Infrastructure Sales Surtax, it seemed appropriate that we would be guaranteed at least the level of interest we would earn locally. We have been consistently monitoring the earnings and any updates regarding the Veteran’s Facility.
The Florida Department of Veterans Affairs (FDVA) provided an update about the project at the BOCC meeting on April 23, 2024. After the initial transfer of $30 million, the Board approved another $10 million from surplus surtax revenues on July 13, 2023 (this $10 Million has not been transferred to the State), to fund the construction of additional facilities for adult day health care services and outpatient therapy. The FDVA submitted a grant application for the VA Construction Grant Program of the U.S. Department of Veterans Affairs. They mentioned in the report the interest over the last ten months of the escrow account.
Our Office provided a graph to illustrate the difference in the State’s interest rate on the $30 million held in escrow compared to what would have been earned on the funds had they been invested by our office. It is important to note that the computation does not include the $29,886.39 additional administrative fee charged by the State for managing the funds.
As you can see, the current escrow account showed a 2.63% annual interest rate with a net growth amounting to $657,793. In comparison, our interest rates have constantly ranged between 5% and 5.54% over the same period, which would have netted $1,385,769. This means there is a $727,976 difference in what would have been earned, in addition to the savings that would have been realized by eliminating the $29,886.39 administrative fee. This is clearly a huge loss in funding and might have been used to increase funds for the facility and/or other vital projects for the community.
I have engaged with Commissioner Saunders and the State Veterans Affairs office, to discuss the possibility of recovering these additional funds. We are receiving reporting that will enable us to continue to monitor the activities within the account.