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HomeMy WebLinkAboutMinutes Council 080988E CITY COUNCIL SPECIAL MEETING CITY OF PALM BEACH GARDENS AUGUST 9, 1988 SEACOAST UTILITY The City Manager gave each Council member a revised copy of the Interlocal Agreement with Palm Beach Gardens, Lake Park, Juno Beach, North Palm Beach and Palm Beach County, stating there were some changes an pages 8 and 9. The composition of the .Authority, after it is established, within 3 years the fo-iat will change based on ERCs in each jurisdiction. The initial startup of the Authority would require a unanimous vote For any decisions re: management team, operations, or condemnation. Another revision states that if any entity has more than 50% of the weighted voting, it must have one other entity to vote with them. Any action taken by the Authority will require 51% of the weighted vote. The money paid by each entity in creating the Authority would be paid back in a 3 year period. Each entity will submit invoices for any other expenses incurred to date and the Authority will make a decision, by unanimous vote, if the entities are to be reimbursed. After this action, any revenues received by the Authority will stay with the utility and the municipalities or county will not receive any revenues from this utility. Vice Mayor Martino stated he would like information why this agreement was good for the City. A report was given re: terms of the sale of Junioer Investment Company an(; how loans totally $71,000,000 were to be paid back. It was noted that Foundation Land did not sell any real estate, retaining all underlying land and all transmission mains. Instead, Foundation will lease the real estate and mains to Juniper Investment for $2,000,000 a year for 20 years. At the end of the 20 years Juniper will have the opportunity to purchase the real estate and mains for $20,000,000 or what is then the fair market value. This brings the total purchase price over $115,000,000 purchase CITY COUNCIL SPECIAL MEETING, 819088 11 PAGE 2 price. Mr. Whitman, the potential purchaser of the system, stated in a deposition that he was interested in buying land in Florida, however, stated that the purchase of land was not a part of the utility purchase. Mr. Whitman also stated the terms of the loan have not yet been nego- tiated. In resnonse to Mayor Feeney, Attorney Brandenburg stated the decision to proceed with the transaction and operation of the utility would be between The Foundation and the buyer while this was going through condemnation proceedings. Attorney Brandenburg stated Mr. Whitman admitted he did not have any knowledge about the County's Tra`fic Standards, Impact Fees or the general attitude about growth in the area. Vice Mayor Martino stated that the Foundation Land Company has hurt the rate - payers with this sale to a private owner, based on the terms of the loan. Vice Mayor Martino stated if Foundation Land Company wanted to be the good neighbors that they have portrayed themselves to be over the years, they should come back to the "drawing board" for the sale of Seacoast Utility to the public sector. The City Manager stated an "acquisition team" will have to be selected. The City Manager stated the City of Palm Beach Gardens has been spending monies for this acquisition, while others have not, and is now looking for the other entities involved to spend money on the acquisition. Attorney Brandenburg stated that at the next meeting of the other three mcnicipali- ties and the County, each one will need to determine who they want to appoint to this Authority and make that appointment in a public session. OR After that's done the first meeting of the Authority will be called and they will elect a Chairman and Vice - Chairman. At that time t1,y will CITY COUNCIL SPECIAL MEETING, 8 /9 188 PAGE 3 decide who is going zo be on the "acquisition team ", hire that team, set up accounts in record and obtain the $500,000 from the entities and start moving ahead on the advice of the acquisition team. Attorney Brandenburg felt the Authority would want an analysis before malting tie d°r.:�io;i tc to condemnation, reporting what the maximum outside costs and inside costs will be, time frame, and the areas of weakness and strength in the case. Meanwhile, the Authority will still be pursuing matters with the Public Service Commission. The City Manager stated the reason the City is seeking condemnation is in the best interest of the Public, feeling the utility should be under public ownership to assure a uniform rate base. The City Manager stated the City is concerned the cost that 7s being paid for the system far exceeds the value, therefore, the users will ultimately be penalized if the governmental agencies do not acquire the system. By a unanimous vote of the City Council, the Interlocal Agreement for the Acquisition of Seacoast Utility was approved, as well as the initial cost of $200,000 from the City of Palm Beach Gardens. APPROVAL f 1.1AYOR FEENEY { COUNCILMAN ALDRED VICE MAYOR MARTINO COUNCILWOMAN MADE -' COUNCILMAN KISE ATTEST:, �,' // LINDA KOSIER, DEPUTY CITY CLERK