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MINUTES OF THE COMMITTEE MEETING ON BUCCANEER UTILIITIES
HELD AT THE CITY HALL ON MARCH 20, 1985 AT 7:00 P.M.
Mayor Howell called the meeting to order at 7:00 p.m. Those present were
Mayor Howell, Commissioners Cook, Gulliford, and Van Ness; City Manager
Fellows; City Attorney Mullis, Jerry Strayve and Bob Braid of Buccaneer
Service, and Richard Gordon and Wayne Middleton of Touche Ross.
The committee immediately entered into negotiations with Buccaneer Service
Company for the purchase of their utilities company.
Mayor Howell acknowledged receipt of the engineering report from Gee & Jensen
and Stewart Steeg's report was incorporated in the report as to the value of
the land. The appraised value was $4,400,000.00 for the plant and real estate.
Touche Ross's report indicated the income from the customers presently being
served by Buccaneer showed sufficient income to amortize the purchase price
of that amount over a period of fifteen (15) to twenty (20) years depending
on how the city wanted to approach it. Mr. Strayve said their original asking
price was $3,900,000.00 and they would still honor the offer. Their asking
interest rate was 81/2% amortized over fifteen(15) years.
Following negotiations, the following terms were acceptable to both parties:
• 1. Purchase price of $3,900,000.00 at 7.5% interest to be amortized
over fifteen(15) years with an unlimited prepayment clause after
five(5) years with no premium penalty. Interest to be paid semi-
annually and premium paid annually.
2. Buccaneer agreed to interconnect the two water systems within a
period of eighteen (18) months after closing. In the interim,
necessary connections will be made by Buccaneer. Buccaneer must
have engineering privilege of approving plans for the proposed
motel on Mayport Road.
3. Touche Ross will prepare a purchase audit from the end of the last
fiscal year up through the date the assests are transferred.
Buccaneer will pay all costs. Also, a cut-off date will be estab-
lished and water meters read. The city will also agree to assist
Buccaneer in the collection of those fees due Buccaneer.
4. Divert the wastewater from the Buccaneer trailer park lift station
to Buccaneer's man-hole within sixty (60) after closing.
5. Buccaneer will exercise their option to purchase the land adjacent
to their plant for expansion of the tanks, and will deed to the
city.
6. Buccaneer will complete the East side lift station. This to be in-
cluded in the $3,900,000.00.
mill
7. Mr. Strayve and Mr. Braid have agreed to stay on in the operation
of the plant through December 31, 1985 at no cost to the city, and
city will request the other employees to remain with the city if
Page Two
Minutes
March 20, 1985
so desired. There are three other employees.
Commissioner Gulliford then moved to recommend to the City Commission,
subject to the terms and conditions agreed upon this evening by both
parties, that the City purchase Buccaneer Utility Service Company for
the price of $3,900,000.00. The City Attorney be authorized to prepare
the necessary Resolutions and Ordinances for introduction. The motion
was seconded by Mayor Howell and carried unanimously.
Commissioner Gulliford asked Mr. Strayve why they did not service
Seminole Beach residents. Mr. Strayve stated they had planned to but
did not as Atlantic Beach already has lines there. He said, as they
begin looping, they have easements through Hannah Park that they can
loop that way. Bring Atlantic Beach water up Seminole Road to meet
through Hannah Park and over to Buccaneer.
Mr. Mullis stated there were many items that needed to be decided:
coverage and reserve fund, etc. Mayor Howell suggested that he and
Mr. Fellows get together and work out those details.
There being no other business, the Mayor declared the committee meeting
adjourned at 9:30 p.m.
William S. Howell
Mayor/Presiding Officer
ATTEST:
Adelaide R. Tucker
City Clerk