Item N2C oun t y of Monr
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BOARD OF COUNTY COMMISSIONERS
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Mayor David Rice, District 4
The Florida Ke s lv ',
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Mayor Pro Tern Sylvia J. Murphy, District 5
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Danny L. Kolhage, District 1
George Neugent, District 2
Heather Carruthers, District 3
County Commission Meeting
December 13, 2017
Agenda Item Number: N.2
Agenda Item Summary #3120
BULK ITEM: Yes DEPARTMENT: Sustainability
TIME APPROXIMATE: STAFF CONTACT: Rhonda Haag (305) 453 -8774
N/A
AGENDA ITEM WORDING: Approval to advertise a public hearing, to consider adoption of a
proposed ordinance for the Property Assessed Clean Energy (PACE) program, to be held on January
17, 2018 in Marathon, FL at 3:00 p.m. or as soon thereafter as may be heard.
ITEM BACKGROUND: The item seeks approval to advertise a public hearing to consider
adoption of a proposed ordinance establishing a Property Assessed Clean Energy (PACE) program.
Summary: At the October 18, 2017 Monroe County Board of County Commission (BOCC) meeting,
staff was directed by the BOCC to move forward in developing a Property Assessed Clean Energy
(PACE) ordinance to implement a Countywide PACE program, provide for both residential and
commercial availability of the program, and provide for participation in one (1) or more established
PACE programs. PACE programs provide financing for qualified energy efficiency, renewable
energy, and wind resistant improvements. PACE financing is repaid as an assessment on property's
regular tax bill. This Ordinance reflects those directions establishing requirements for the PACE
programs, including consumer protection requirements, and incorporates best practice standards to
ensure high quality PACE providers and programs countywide.
Background and Justification: The establishment of a PACE program for Monroe County aligns with
the County's GreenKeys climate resilience and sustainability plan (Item 2 -16) and the Southeast
Florida Regional Climate Compact. Providing PACE, as an alternative to traditional forms of
financing, is a good strategy to increase energy efficiency in residential and commercial buildings
thus reducing community greenhouse gas (GHG) emissions. As PACE has developed nationally, it
has become a viable option for property owners enabling much broader range of property owners to
implement energy efficiency, renewable energy, and wind resiliency improvements that increase the
value, functionality, and sustainability of their buildings. These improvements reduce building
operational costs, energy use, and GHG emissions.
PACE Programs expand the financial options for property owner to access these improvements
while providing advice, tools and resources that enable property owners to make informed choices.
Based on Board direction to ensure consumer protection to the greatest extent feasible and as other
municipalities have done, staff incorporated a number of residential consumer protection policies
from PACENation, an association of individuals and organizations joined in support for PACE
financing. These policies are rooted in the premise that consumer protections to serve homeowners
must be a core value of PACE Programs and Partners he government authority or third party non-
government administrator) which staff has captured in the attached ordinance.
Staff worked with PACE industry representatives to ensure the ordinance does not conflict with their
programs. The attached Ordinance represents a joint effort to provide County property owners with
access to voluntary non -ad valorem assessments to implement energy efficiency, renewable energy,
and wind resiliency improvements on their properties, providing appropriate consumer protections,
and reflecting best practice standards ensuring high quality PACE Programs operate within our
County.
PREVIOUS RELEVANT BOCC ACTION:
10/18/17 Direction and guidance on a potential County PACE program
CONTRACT /AGREEMENT CHANGES:
N/A
STAFF RECOMMENDATION: Approval
DOCUMENTATION:
PACE Ordinance Monroe County
FINANCIAL IMPACT:
Effective Date: N/A
Expiration Date: N/A
Total Dollar Value of Contract: None
Total Cost to County: Estimated $250 for advertisements. No other costs to the County.
Current Year Portion: $250.
Budgeted: Yes
CPI: N/A
Source of Funds: Sustainability
Indirect Costs: N/A
Estimated Ongoing Costs Not Included in above dollar amounts: Staff administration costs
Revenue Producing: No If yes, amount: N/A
Grant: No County Match: N/A
Insurance Required: N/A
Additional Details:
N/A
REVIEWED BY:
Rhonda Haag Completed 11/19/2017 3:18 PM
Pedro Mercado
Budget and Finance
Maria Slavik
Kathy Peters
Board of County Commissioners
Completed
11/20/2017 11:26 AM
Completed
11/20/2017 2:08 PM
Completed
11/20/2017 2:24 PM
Completed
11/27/2017 9:19 AM
Pending
12/13/2017 9:00 AM
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ORDINANCE NO. 20 -
AN ORDINANCE OF THE BOARD OF COUNTY
COMMISSIONERS OF MONROE COUNTY, FLORIDA,
ESTABLISHING THE PROPERTY ASSESSED CLEAN
ENERGY (PACE) PROGRAM ORDINANCE;
PROVIDING FOR A TITLE; PROVIDING FOR
AUTHORITY; PROVIDING FOR APPLICABILITY;
PROVIDING FOR DEFINITIONS; PROVIDING FOR
REPEAL OF LAWS IN CONFLICT; PROVIDING FOR
SEVERABILITY; PROVIDING FOR INCLUSION IN
THE CODE OF LAWS AND ORDINANCES;
PROVIDING FOR CAPTIONS; AND PROVIDING FOR
AN EFFECTIVE DATE.
1 WHEREAS, Property Assessed Clean Energy (PACE) programs have been
2 established across the country to provide mechanisms for funding energy efficiency,
3 renewable energy, and other types of improvements to residential and commercial properties;
4 and
5 WHEREAS, PACE programs are typically established by local governments and are
6 administered by the local government or by for -profit or not - for -profit entities; and
7 WHEREAS, PACE financing is repaid as an assessment on the property's regular tax
8 bill; and
9 WHEREAS, Section 163.08, Florida Statutes, authorizes programs, typically referred
10 to as PACE programs, that levy non -ad valorem assessments allowing property owners to
11 apply to local governments for financing certain energy efficiency, renewable energy and
12 wind resistant improvements; and
13 WHEREAS, Section 163.08, Florida Statutes, provides that properties retrofitted
14 with energy - related qualifying improvements benefit from reduced energy consumption,
15 reduced potential for wind damage, and assist in the fulfillment of the state's energy and
16 hurricane mitigation policies; and
17 WHEREAS, the PACE assessment is collected pursuant to Florida's uniform
18 method for the levy, collection and enforcement of non -ad valorem assessments, Section
19 197.3632, Florida Statutes; and
20 WHEREAS, the Board of County Commissioners intends to establish qualifications
21 and consumer protection disclosure requirements for PACE programs that provide financing
22 for qualifying improvements in accordance with Section 163.08, Florida Statutes, and
23 provisions of this ordinance; and
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WHEREAS, it is the intent of the County to enter into interlocal agreements with
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multiple PACE agencies /authorities /districts to encourage competition and provide more
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choices for property owners; and
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WHEREAS, the Board of County Commissioners acknowledges the Florida
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Legislature's finding that there is a compelling state interest in enabling property owners who
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wish to undertake such improvements and to enable property owners to voluntarily finance
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such improvements with local government assistance and finds that creation of a PACE
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program will serve the public health and welfare of the citizens of Monroe County, and
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WHEREAS, the Board of County Commissioners has conducted a duly noticed e
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public hearing to consider this Ordinance in accordance with Section 125.66, Florida t
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Statutes; and
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WHEREAS, the Board of County Commissioners of Monroe County, pursuant to its
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authority under the Florida Constitution, Article VIII, Section 1(f) and Section 125.01,
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Florida Statutes- hereby adopts the Monroe County Property Assessed Clean Energy (PACE)
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Ordinance.
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NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF COUNTY
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COMMISSIONERS OF MONROE COUNTY, FLORIDA, that: g
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Section 1. TITLE:
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This Ordinance shall be titled the "Monroe County Property Assessed Clean Energy
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(PACE) Ordinance." U
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Section 2. AUTHORITY: c
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This article is adopted pursuant to the authority granted to non - charter counties under
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Article VIII, Section 1(f) of the Florida Constitution and Chapter 125, Florida Statutes.
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Section 3. APPLICABILITY:
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This Ordinance shall be applicable within the unincorporated areas of Monroe County,
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and in all municipalities that have not adopted an ordinance governing any or all of the subject
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matter of this Ordinance, regardless of the time of passage of the municipal ordinance.
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Section 4. DEFINITIONS:
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For purposes of this Ordinance, the following words and phrases shall have the
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following meanings:
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(1) Board or County is the Monroe County Board of County Commissioners.
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1 (2) Financing Agreement shall mean the financing agreement or the summary memorandum
2 of such agreement the property owner signs establishing terms and conditions for the
3 financing of qualified improvements which is required to be recorded in the public
4 records pursuant to the PACE Statute.
5 (3) Qualifying Improvements includes energy conservation and efficiency, renewable
6 energy, and wind resistance improvements as defined by Section 163.08, Florida
7 Statutes, as may be amended by law.
8 (4) PACE assessment shall mean the non -ad valorem assessment placed on a property
9 owner's tax bill as a result of financing obtained pursuant to this Ordinance.
10 (5) PACE agencies /authorities /districts shall mean one or more local governments defined
11 in Section 163.08(2)(a), Florida Statutes, authorized by Monroe County to offer PACE
12 financing for qualifying improvements.
13 (6) PACE Program shall mean the County's provision through interlocal agreements with
14 PACE agencies /authorities /districts offering financing for qualifying improvements as
15 approved by the State of Florida pursuant to Section 163.08, Florida Statutes, further
16 refined in this ordinance, as may be amended by law.
17 (7) PACE Statute shall mean Section 163.08, Florida Statutes and all future amendments
18 thereto.
19 (8) Residential Property shall mean a residential property consisting of four (4) or less
20 residential units.
21 (9) Non - Residential Property shall mean commercial, industrial, agricultural and residential
22 properties consisting of five (5) or more residential dwelling units.
23 Section 5. PACE PROGRAM AUTHORIZATION:
24 (1) PACE agencies /authorities /districts offering financing for Qualifying Improvements
25 pursuant to this ordinance shall be approved by the County and authorized through
26 interlocal agreements to provide financing subject to the requirements of this ordinance
27 and the PACE Statute. The interlocal agreements shall include specific terms and
28 conditions for PACE agencies /authorities /districts to operate within Monroe County.
29 (2) PACE agencies /authorities /districts desiring to provide financing pursuant to this
30 ordinance shall provide sufficient documentation as requested by the County to provide
31 reasonable assurance that the requirements of this ordinance and the PACE Statute can be
32 met by the PACE agency /authority /district.
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I Section 6. DISCLOSURE REQUIREMENTS:
2 (1) In addition to any disclosure requirements in the PACE Statute, PACE
3 agencies /authorities /districts that extend financing pursuant to the PACE Statute and levy
4 non -ad valorem assessments to fund the qualifying improvements shall present to the
5 property owner a separate, written notice disclosing the following ( "Notice "):
6 (a) The estimated total amount of the debt, including amount financed, fees, fixed
7 interest rate, capitalized interest and the effective rate of the interest charged
8 ( "Annual Percentage Rate" or "APR");
9 (b) That PACE agencies /authorities /districts may only offer fixed simple interest rates
10 and payments that fully amortize the obligation. Variable or negative amortization
11 financing terms are not permitted. Capitalized interest included in the original balance
12 of a PACE financing does not constitute negative amortization.
13 (c) The repayment process and terms, amounts and a schedule that fully amortizes the
14 amount financed including the estimated annual PACE assessment;
15 (d) That the PACE assessment will appear on the property owner's tax bill;
16 (e) That there is no discount for paying the PACE assessment early;
17 (f) The nature of the lien recorded and that the PACE assessment will be collected in the
18 same manner as real estate taxes. That failure to pay the PACE assessment may cause
19 a tax certificate to be issued against the property, and that failure of payment thereof
20 may result in the loss of property subject to the PACE assessment, including
21 homestead property, in the same manner as failure to pay property taxes;
22 (g) The specific improvements to be financed and installed and that such improvements
23 and PACE assessment may or may not affect the overall value of the property;
24 (h) A PACE assessment payment tern that does not exceed the useful life of the
25 improvements;
26 (i) The right of pre - payment without penalty;
27 (j) Notice that the property owner may be required to pay any PACE assessment in full
28 at the time of refinance or sale of the property; and
29 (k) The 3 -day right to cancel the financing.
30 (2) The Notice must be delivered to the property owner by the PACE
31 agency /authority /district and must be signed and dated by the property owner prior to or
32 contemporaneously with the property owner's signing of any legally enforceable
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I documents under the PACE program. The property owner and the PACE
2 agency /authority /district must keep the signed Notice with the property owner's executed
3 financing agreement.
4 (3) The PACE agency /authority /district shall record, or cause to be recorded, the financing
5 agreement or a summary memorandum of the financing agreement, in accordance with
6 Section 163.08(8), Florida Statutes.
7 Section 7. ELIGIBLE PROPERTIES/PROGRAM REOUIREMENTS:
8 (1) As defined in the PACE Statute, PACE agencies /authorities /districts that extend
9 financing pursuant to the PACE Statute and levy non -ad valorem assessments to fund the
10 qualifying improvements shall comply with the following:
11 (2) Residential Property. PACE agencies /authorities /districts may finance qualifying
12 improvements on Residential Properties provided they comply with the following criteria
13 inclusive of all eligibility criteria listed in the PACE Statute and all future amendments
14 thereto, along with additional consumer protections.
15 (a) Without the consent of the holders or loan servicers of any mortgage encumbering or
16 otherwise secured by the property, the total amount of any non -ad valorem
17 assessment for a property under the PACE Statute may not exceed twenty percent
18 (20 %) of the just value of the property as determined by the county property
19 appraiser, excepted as otherwise provided by statute; and
20 (b) All property taxes and other assessments levied on the property tax bill have been
21 paid and have not been delinquent for the preceding three years, or the property
22 owner's period of ownership, whichever is less; and
23 (c) There are no involuntary liens, including but not limited to construction liens on the
24 property; and
25 (d) No notices of default or other evidence of property-based debt delinquency have been
26 recorded during the preceding three years, or the property owner's period of
27 ownership, whichever is less; and, additionally
28 (e) All mortgage debt on the property is current and not delinquent; and
29 (f) All mortgage - related debt on the underlying property may not exceed 90% of the
30 property's fair market value ( "FMV "); and
31 (g) The total mortgage - related debt on the underlying property plus the PACE program
32 financing may not exceed the FMV of the property.
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1 (3) Non - Residential Properties. PACE agencies /authorities /districts may finance Qualifying
2 Improvements on Non - Residential Properties provided they comply with the
3 requirements set forth in the PACE Statute and all future amendments thereto and
4 inclusive of those listed under Section 7(2)(a -d) of this Ordinance.
5 (4) Quali Being Improvements. The PACE agency /authority /district will finance energy
6 efficiency, renewable energy and wind resistant improvements that are permanently
7 affixed to the property as more specifically described in the PACE Statute. All
8 improvements and products should identify efficiency standards established by the U.S.
9 Department of Energy, the U.S. Environmental Protection Agency, or Florida state
10 agencies as applicable. All qualifying improvements must comply with the PACE
11 Statute for energy efficiency, renewable energy and wind resistance or other
12 improvements as permissible by law. PACE agencies /authorities /districts shall establish
13 procedures confirming that the property owner applying for financing through the PACE
14 agency /authority /district intends to install eligible products, and that at the time of
15 funding such improvements have been installed.
16 (5) Inquiries and Complaints.
17 (a) The PACE agency /authority /district shall be required to receive, manage, track,
18 timely resolve and report on complaints from property owners regarding the funded
19 work performed by the contractors. The PACE agency /authority /district shall
20 investigate and mediate disputes between property owners and contractors in a timely
21 manner.
22 (b) Payment inquiries. The PACE agency /authority /district shall be required to respond
23 to inquiries and resolve any issues in a timely manner, related to payments, including
24 but not limited to prepayments and payment reconciliation.
25 (c) Review. In the event that ten percent or more of a PACE
26 agency's /authority's /district's projects result in complaints or disputes, or such
27 complaints or disputes remain unresolved six months after completion of a project,
28 the County may review the PACE agency's /authority's /district's handling of
29 complaints and may request corrective actions or initiate suspension proceedings
30 pursuant to Section 7(13).
31 (6) Data Security. The PACE agency /authority /district is responsible for taking security
32 measures that protect the security and confidentiality of consumer records and
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I information in proportion to the sensitivity of the information, and as required by state
2 and federal law.
3 (7) Consumer Privacy. The PACE agency /authority /district must develop and maintain a
4 privacy policy that complies with state and federal law and, in particular, shall provide a
5 property owner the ability to opt -out of having the property owner's information shared
6 with third parties, except where expressly permitted by state and federal law.
7 (8) Marketing and Communications. Marketing practices for a PACE
8 agency /authority /district that are or could appear to be unfair, deceptive, abusive, or
9 misleading, or that violate applicable laws or regulations, that are inappropriate,
10 incomplete or are inconsistent with the PACE agency's /authority's /district's purpose are
11 prohibited.
12 (9) Protected Classes. The PACE agency /authority /district shall not discriminate against
13 individuals on the basis of race, color, ancestry, disability, national origin, religion, age,
14 familial status, marital status, sex, gender, sexual orientation, gender identity and
15 expression, or genetic information.
16 (10) Contractor Management.
17 (a) Any work under a PACE agency /authority /district requiring a license under any
18 applicable law to make a qualifying improvement shall be performed by a contractor
19 properly licensed, certified or registered pursuant to state law.
20 (b) Contractors performing work under a PACE agency /authority /district shall comply
21 with each of the following conditions: (i) Be licensed and insured pursuant to the
22 applicable statutory requirements; (ii) Agree to comply with all program requirements
23 and marketing guidelines; (iii) Act in good faith to timely resolve property owner
24 complaints.
25 (c) PACE programs shall have and shall strictly enforce anti- kickback policies and
26 procedures that prohibit direct financial or other monetary incentives to contractors in
27 exchange for or related to such contractor being awarded work under a PACE
28 program, excepting payment for the contractor's installation of eligible improvements.
29 (11) Financing. The PACE agency /authority /district will establish pricing rules and
30 enforcement mechanisms to ensure property owners are protected from excessive or
31 unjustified prices and charges. In addition, the PACE agency /authority /district shall
32 require compliance with each of the following conditions prior to the issuance of any
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I funding to the contractor:
2 (a) Contractors have certified that any necessary permits have been obtained;
3 (b) Verification that the qualifying improvements have been installed;
4 (c) The property owner and the contractor have signed a final inspection and/or
5 certificate of completion that all improvements have been installed to the property
6 owner's satisfaction.
7 (12) Reporting Each PACE agency /authority /district shall provide a report to the County
8 on a quarterly calendar basis, which shall include, at a minimum, the following
9 information:
10 (a) Dates of the reporting period;
11 (b) List of PACE projects (including addresses including municipal jurisdiction, financed
12 amount, interest rate, assessment duration, and project description) started during the
13 reporting period, separated by building type (e.g., single family, multifamily, retail,
14 office, industrial, etc.);
15 (c) List of PACE projects (including addresses including municipal jurisdiction)
16 completed during the reporting period, separated by building type project (e.g., single
17 family, multifamily, retail, office, industrial, etc.), specify; (1) the qualifying
18 improvements made; (2) project start date and completion date; (3) the projected
19 energy savings and/or amount of potential renewable energy to be generated; (4)
20 financial information such as cost per kilowatt hour saved/generated; (5) other
21 resource savings if data is available; and (6) audits performed detailing the audit
22 results, if applicable to the project;
23 (d) Number of actual or estimated jobs created during the reporting period, including
24 local versus non -local jobs and permanent versus temporary jobs;
25 (e) Number of applications declined during the reporting period;
26 (f) Unresolved complaints and/or contractor issues and status; and
27 (g) Description of the standardized third -party methodologies and supporting
28 assumptions used to verify data, and any changes in the methodologies and
29 assumptions from the previous reporting period.
30 (13) Suspension or Termination OPACE a eennUlauthority /district. In the event any PACE
31 agency /authority /district fails to incorporate and continually provide for all of the
32 foregoing service components or to otherwise abide by the provisions of this Ordinance
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I and/or the interlocal agreement the County, in its sole discretion, may suspend or
2 terminate the interlocal agreement and support of the County at any time upon written
3 notice to that PACE agency /authority /district. Any project that has been initiated as of the
4 time of suspension or termination shall be permitted to be completed.
5 Section 8. REPEAL OF LAWS IN CONFLICT:
6 All local laws and ordinances in conflict with any provisions of this Ordinance are
7 hereby repealed to the extent of such conflict.
8 Section 9. SEVERABILITY:
9 If any section, paragraph, sentence, clause, phrase or word of this Ordinance is for
10 any reason held by a Court of competent jurisdiction to be unconstitutional, inoperative, or
11 void, such holding shall not affect the remainder of this Ordinance.
12 Section 10. INCLUSION IN THE CODE OF LAWS AND ORDINANCES:
13 The provisions of this Ordinance shall become and be made a part of the Monroe
14 County Code. The sections of this Ordinance may be renumbered or relettered to accomplish
15 such, and the word Ordinance may be changed to section, article, or other appropriate word.
16 Section 11. CAPTIONS:
17 The captions, section headings and section designations used in this Ordinance are for
18 convenience only and shall have no effect on the interpretation of the provisions of this
19 Ordinance.
20 Section 12. TRANSMITTAL AND EFFECTIVE DATE:
21 This Ordinance shall be filed with the Department of State and shall be effective as
22 provided in section 125.66(2), Florida Statutes.
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24 APPROVED and ADOPTED by the Board of County Commissioners of Monroe
25 County, Florida, on this the day of , 20
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27 KEVIN MADOK, CLERK
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30 By:
31 Deputy Clerk
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BOARD OF COUNTY COMMISSIONERS
OF MONROE COUNTY, FLORIDA
By:
David Rice, Mayor
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