By Brian Liberatore
August 4, 2008

As the longest-serving manager in Cape Coral’s history, Terry Stewart has seen historic growth and now an unprecedented decline in his city.

Whether he continues to lead the city’s administration through its next chapter depends on a vote today from the City Council. The council is set to decide whether to extend Stewart’s contract beyond February.

While all of the council members have raised issues about Stewart’s performance, only Councilman Pete Brandt has said he would push to end the contract.

Stewart believes he will continue as city manager.

“I expect to have a job after Monday,” he said. “It is my desire to remain here. I want to continue to work here. If they decide to terminate my contract, they will have to pay me what they owe me.”

Stewart’s annual salary is $162,000.

It will take five council members to end that contract – a move that appears unlikely given members’ past and current appraisals of the city manager.

“The jury’s still out on some things,” said Councilman Eric Grill. “I do not have a yes or no.”

Grill and Pete Brandt were the only two council members to give Stewart a less than satisfactory review when the council discussed Stewart’s performance in March.

Brandt this week sent a memo to the council outlining his case against Stewart.

“He (Stewart) has redeemed himself in some areas,” Grill said. “But there are still some issues with accountability.”

Grill said he was alarmed with an error in the city’s Department of Community Development that was discovered last week. The department gave the go-ahead to a commercial building even though one of the parcels on the site was still zoned for residential homes.

Dolores Bertolini was the only council member in March to give Stewart an “excellent rating.” Her opinion, she said, hasn’t changed.

“I put my issues in two columns: – one unforgivable and one workable,” Bertolini said. “Every issue I’ve had with the city manager has been workable.”

The other four council members in March gave Stewart satisfactory marks on his evaluation. Despite a few concerns, including displeasure at Stewart’s call to raise the tax rate, none of the council members have pushed for Stewart’s removal.

“I’m still undecided,” said Councilman Jim Burch. “I lean one way one day and one way the next.”

Mayor Eric Feichthaler planned to meet today with Stewart to discuss the vote.

The City Council in 2002 voted unanimously to hire Stewart, picking him over three other finalists. Stewart was fresh from an eight-year tenure as assistant city manager for Pembroke Pines, a suburb of Fort Lauderdale with about the same population as Cape Coral.

During his time on the state’s east coast, Stewart helped oversee rapid growth faster even than the Cape’s growth during the same period.

When Stewart got to the Cape, the city exploded. Since 2002, the Cape has added about 55,000 new residents and more than quadrupled its taxable value. The rise in value meant the city’s property tax revenues went from $26 million to a high of $102 million in 2007.

With rising population and influx of cash, the city added 150 police officers, 97 firefighters and a total of 707 employees across all departments. General fund spending went from $67 million to $150 million this year.

But almost as fast as it climbed, the city’s taxable value is starting to plummet – 25 percent this year. Homes that sold for $300,000 two years ago are now sitting on the market for half that. And as property values drop, so do property taxes. The city will take in about $24.6 million less in taxes next year.

As challenging as it was to hold the reins of city growing at breakneck speed, it may prove even more difficult to shrink a city government.

“I told him that he did a good job building up the city,” said Councilman Bill Deile. “Now I want to see how well he is at dismantling that empire.”

In Stewart’s budget proposal for next year, he calls for cutting 110 positions, 24 of which are filled. Stewart had asked the City Council to raise the tax rate 6 percent to offset plummeting tax revenue. The council refused and set the maximum tax rate at this year’s level.

Stewart now needs to find another $4.7 million to cut from his budget proposal.

Since taking office, Stewart has never had anything but an overall favorable performance review from the council. But in that time period, the public’s perception of the city has taken blows.

The price of the city’s utility expansion program skyrocketed during the construction boom in 2005 and 2006. Minimum assessments to homeowners went from about $12,000 in the Southwest 3 Assessment Area to about $20,000 in the SW 4 area. The higher costs soured residents’ view of the project. A stinging 2006 audit of the program from Kessler International further poised that perception.

Stewart disagreed with many of Kessler’s findings, and has asked the council not to bring back Kessler International for a follow-up audit, despite calls to do so from some on council and the community.

The Department of Community Development also has faced criticism from the City Council for errors under Stewart’s leadership. The department handled 7,700 single-family building permits during the 2004-05 fiscal year. There have been 170 so far this fiscal year with two months to go. The crash has meant a reduction in staff, but Grill and others continue to point to problems.

Councilman Derrick Donnell said the opinion of his constituents is mixed. But little has happened, he said, to shake his “satisfactory” assessment of Stewart four months ago.

“He has some strong points and he has some weak points,” Donnell said. “All of us, including me, have areas we need to work on. And all of us have our strong points.”

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