HomeMy WebLinkAboutMinutes Council 022290 SpecialCITY COUNCIL
® SPECIAL REGULAR MEETING
CITY OF PALM BEACH GARDENS
FEBRUARY 22, 1990
The Special Regular Meeting of the City Council of Palm Beach Gardens,
Florida, was called to order by Mayor Martino in the Assembly Room of the
Municipal Complex, 10500 North Military Trail, Palm Beach Gardens, Florida
at 8:00 P.M.; and opened with the Pledge of Allegiance to the Flag.
ROLL CALL The Secretary called the roll, and present were Mayor Martino, Vice Mayor
Aldred, Councilman Kiselews',i ani
would be arriving late.
Vice Mayor Aldred made a motion to recess the Special Regular Meeting to
immediately following the Workshop Meeting. The motion was seconded by
Councilman Kiselewski and unanimously adopted by the City Council.
Mayor Martino tailed the Special Regular Meeting to order at 9:37 P.M.,
with all members of the City Council being present.
PUBLIC GOLF
COURSE Attorney Brant explained the reason why he is using an Ordinance for the
purchase of the land. Attorney Brant stated there are three parts in the
proposed Agreement. 1) land acquisition, 2) construction of a standard
golf course; and 3) proposed management agreement with Public Golf
Corporation. Attorney Brant explained the City would retain the sum of
$275,000, which is the profit, to a point in time when the golf course is
completed and turned over. Upon Mayor Martino's suggestion, Attorney
Brant explained the changes that had been made. Councilman Russo was con-
cerned with the number of days allowed to sell the bonds following the
obtaining of the approvals. Attorney Brant stated Attorney Raymond, bond
® counsel, felt that was enough time. Attorney Brant also stated that the
CITY COUNCIL SPECIAL REGULAR MEETING, 2/22/90
PAGE TWO
City issues no bonds and this contract fully does not click in for land
acquisition or cr„ struction until such time as all of the approvals have
been obtained from DER, County Environmental Section, South Florida Water
Management District, Corp of Engineers, and Special Exception from the
County. Attorney Brant stated July 31, 1990, has been set as an outside
date, in the event these approvals are not in place: then, at the option
of either party, this contract can be terminated. If the approvals are in
place, the City Council would be requested to adopt a Resolution
authorizing the issuance and sale of the bonds to fund this project. The
first step then would be land acquisition. The proposal does not contain
firm bids at this time. In the event the final bids are 110% or more,
then either party has the right to terminate. Councilman Kiselewski
wanted clarification re: final bids. Attorney Brant stated that the per-
formance bond will be from a licensed surety company or insurance company
which is acceptable to the City. Public Golf Corporation will not be
giving the City a bond, it will be coming from a third party. Mr. Orr
stated there will be a bond covering the construction and development
costs, however in the event there is a major override of X number of
dollars, the bond will not cover it, leaving the City at risk for that
amount.
Councilman Russo felt the performance bond should be 110% of the costs.
Mr. Orman informed the Council the City will be holding back 10ro on every
draw. Mr. Orman asked if they gave a performance bond for 110 %, he would
like to negotiate the $275,000 profit retainage. Attorney Brant stated
® that the bonding company does not have to complete the project, and only
guarantees payment up to the face amount of the bond. Mr. Orr stated that
CITY COUNCIL SPECIAL REGULAR MEETING, 2/22/90 PAGE THREE
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the bondable amount was $3.5 million. Mr. Orr didn't know if we could get
a performance bond to cover the total amount of construction costs as
opposed to the individual contractors. Mr. Orman stated that Public Golf
Corporation has agreed to a $3.2 million overall bond to assure the
construction costs. Councilman Kiselewski asked if Public Golf
Corporation is going to give us a bond that says this golf course is going
to go in for $4.5 million or just give us a bond for the construction.
Mr. Orman stated that no one gives that kind of bond. Mayor Martino
suggested we go with a performance bond which increased the construction
costs of $3.2 million by 10% and still retain the option on the profit.
The Petitioner agreed to 110% Master Performance Bond and the $275,000
profit to remain as originally discussed. Councilman Russo wanted to
change the wording on page 15, 2.5 to read as "The Seller shall deliver to
the Buyer a Master Performance Bond in the amount of $ .
Councilman Russo wanted a bond in the amount of $4 million. Mr. Orman
stated they cannot deliver a bond in that amount. Councilman Russo feels
the building should be included in the bond amount, which would bring the
total bond to $3,588,000 plus the 10% for a total bondable amount of
$3,948,000. Bob Norris stated that Public Golf Corporation is not capable
of delivering a bond in the amount of $4 million, but is capable of deli-
vering a bond for the total construction of the golf course, including the
buildings, but not including the soft costs, equipment or land.
Councilman Kiselewski suggested that the bond be based on the bid. Since
the City is paying the premium for the bond, it was the consensus of the
® Council that they were willing to pay for the extra premium. The
Petitioner agreed to try to get the $4 million Master Performance dond.
CITY COUNCIL SPECIAL REGULAR MEETING, 2/22/90
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PAGE FOUR
Mr. Orman stated that the County had agreed this morning to the Excemption
for the Traffic Performance Standards. Vice Mayor Aldred stated that the
$4 million Master Performance Bond and the conditions laid out by Attorney
Brant are acceptable to him as a minimum, however, asked for an investiga-
tion as to cost. Vice Mayor Aldred felt the contract should specify a
performance bond of 110% of construction costs and should be in a form
acceptable to the City.
If a "turnkey" bond is available, that point can be reopended and the City
can look at adding costs to this to cover the bond. If a "turnkey" bond
is available, the City would agree not to hold Public Golf Corporation's
profits until the end. If a "turnkey" bond is not obtainable, then the
City will continue to hold the profits and the Master Performance Bond
which would guarantee the construction of the course as it is designed.
Attorney Brant explained that the public liability insurance had been
inserted and would be $100,000 over $300,000. Another point is the amount
of coverage they are going to carry as a contractors' risk coverage.
Councilman Kiselewski suggested deleting "double wide mobil building" in
Exhibit "C" Section B. Councilman Kiselewski wanted page 17, Section 7.3
to have "a mutually agreed upon engineer" inserted in the second sentence.
Vice Mayor Aldred wanted an explanation on page 7, Item 258. Attorney
Brant explained it meant there would be no exceptions to the title except
as set forth in the contract. In other words, no easements, no minerdl
rights and no right to mine exploration. Attorney Norris explained that
If Public Golf Corporation cannot perform only because the City objected
• to title on grounds of a title defect and they make a reasonable effort to
CITY COUNCIL SPECIAL REGULAR MEETING, 2/22/90
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PAGE FIVE
correct that defect and can't, it is not a default on their part; they
cannot give marketable title and the City can cancel the contract without
penalty. Councilman Russo was concerned with Page 6, Section 11 -C,
wanting to know if that paragraph included water. Attorney Brant informed
Councilman Russo that was dealt with in another section. Councilman Russo
was concerned with the fact that the City had an appraisal stating the
land was worth $10,000 to $10,500 and could possibly be worth up to
$12,000 to $12,500. The City Manager stated that the City and Public Golf
Corporation each had an appraisal, Public Golf Corporation's coming in
higher than the City's Public Golf Corporation's appraisal came in at
$12,000 an acre. The difference was that with all the approvals, special
exceptions and other things permitted for a golf course there was another
comparable in South county and a possibility of 20% differential in costs
for the approvals being granted. Based on that, the City's appraiser said
he could possibly live with a 20% increase in costs. There is nothing to
justify that other than the comparables. Mr. Orr stated that the city
does not known wnat Public Golf Corporation is paying for the property,
the only time we will know is after the deal is closed, and it becomes
public record. Mr. Orr stated that the City has to be assured that they
are getting the best deal they can, Mr. Orr stated he cannot guarantee,
other than the information they have from the appraiser, as to the value
of the property. The value of the raw acerage is $10,000 to $10,500 per
acre: the other is subjective. Mr. Orr stated there was an option on the
property for $8,300 an acre. Attorney Norris stated that any option on
the property or whatever they pay for the property, is being purchased
"as is" without approvals. Mr. Orman stated that Public Golf Corporation
CITY COUNCIL SPECIAL REGULAR MEETING, 2/22/90 PAGE SIX
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is raying $12,000 psr acre for the land. Attorney Norris stated that the
$12,600 per acre was negotiated between $14,500 and $12,000 or $12,500.
Attorney Brant stated that the maximum the City could go was $12,500 or
$12,600 with legal justification. Vice Mayor Aldred suggested separating
the Management Agreement from the main contract. Councilman Kiselewski
suggested a change on page 4, Section 6: delete "shall unconditionally"
and add "may ". Mayor Martino stated that we were separating the
Management Agreement out of the contract and we were not going to conclude
those negotiations by March 1st. The Council will look at the Management
Agreement and if they are not satisfied with what Public Golf Corporation
proposes, they may look elsewhere. Councilwoman Monroe suggested a
Special Meeting to finalize the Management Agreement on Monday or Tuesday
or next week. Mr. Orr stated that due to the changes made tonight, there
cannot be a vote. Councilwoman Monroe suggested recessing this meeting to
a date and time certain, once the changes have been made. Attorney Norris
wanted a consensus of the Council that they agree on the actual language
subject to the changes. Attorney Brant advised the Council not give a
consensus as to opinion. Attorney Norris stated there will be a revised
document ready for the Council by Friday. Mayor Martino felt the Staff
needed to look at the document before it came back to Council. Mayor
Martino stated that 4 of the 5 Council members must vote for the contract.
Councilman Kiselewski made a motion to recess this meeting until
Wednesday, February 28, 1990 at 8:00 P.M., seconded by Vice Mayor Aldred.
This motion was unanimoulsy approved by the City Council,
ADJOURNMENT There being no futher business to discuss, the meeting was recessed at
• 12:06 P.M.