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• Although TCF has had contact with LTVC over the past several months, the tetnis of the proposed contract offer have not been accepted by LTVC. Rather, LTVC representative Charles Bayer has indicated that LTVC will not consider terms for sale of the islands (and McCuller's Point) until LTVC first receives a formal contract offer approved by the County, City of Vero Beach, and Town of Indian River Shores. Recently, both the City and Town approved the proposed contract offer. The contract offer is now being presented to the Board for consideration. Contract Offer Following is a summary of the main components of the proposed contract offer: • $15 million purchase price for —505 acres (-235 acres of which are uplands), consisting of LTVC ownership on the "Inner Islands", "Outer Islands", "McCuller's Point", and six small adjacent islands. • $10,000 earnest money deposit (non-refundable after an inspection period for due diligence). • ' Bargain Sale" acknowledgment to allow LTVC to seek status of the sale as a charitable contribution under applicable sections of the Internal Revenue Code. • "Involuntary Conversion" (threat of condemnation) provision to allow LTVC to seek tax relief. • "Settlement of Claims" provision whereby LTVC must agree to dismiss all pending lawsuits and agree not to initiate any future lawsuits regarding the subject property. Funding Towards the Purchase The County has reserved $8 million toward the purchase, and the City and Town have agreed to contribute $1 million each toward the purchase. Last year, the County applied for a Florida Communities Trust (FCT) grant to fund the remaining $5 million toward the $15 million purchase offer. The FCT approved the grant, at 36.22% of "eligible project costs" or $5.5 million, whichever is less. The Board recently approved an Addendum to the FCT Conceptual Approval Agreement that increased the FCT match to 75% of eligible costs, provided the overall grant award does not exceed $5.5 million. The Addendum ensures an FCT match of $4,875,000 (75% of $6.5 million, the current "as is" approved appraised value) towards the Lost Tree Islands purchase price. The FCT will also pay 75% of acquisition costs (i.e., appraisals, survey, environmental audit acquisition agent fees), provided the overall grant award does not exceed $5.5 million. The FCT match of $4,875,000 falls $125 000 short of the anticipated $5 million state match toward the $15 million purchase offer. If an offer of $15 million is made and LTVC accepts, the $125,000 shortfall will need to come from the local governments. Both the City and Town, when they recently considered the proposed contract offer, agreed to evenly split the shortfall with the County ($41,667 each). Interlocal Agreement As the County, City and Town consider approval of the proposed contract offer, three issues warrant a formal interlocal agreement. The issues are: who will be responsible for the state -funding shortfall toward the proposed purchase offer; who will hold title interest if and when the project is purchased; and who will be responsible for management funding. Attached is a draft interlocal agreement for the Board to consider regarding these issues. ALTERNATIVES & ANALYSIS Contract Offer The $15 million purchase price is indicative of last year's proposed purchase offer that led the County, City and Town to apply for an FCT grant. Since last year, the County has obtained two independent appraisals of the islands, the results of which are public information. The appraisals, which have been reviewed and approved by the FCT, provide values for three alternative scenarios (each with a development density of one unit per five acres). The three alternatives are summarized as follows: September 3, 2002 61 •