03-25-85 v •
AGENDA
CITY OF ATLANTIC BEACH
March 25, 1985
Call to Order
Invocation and Pledge to Flag
1. Approval of the Minutes of March 11, 1985
2. Recognition of Visitors
3. Correspondence
4. Advisory Planning Board
A. Commissioner Van Ness has a report of recommendations of the
Advisory Planning Board as to:
a) Zoning along Mayport Corridor.
b) Request of Sunshine Church for approval of use of private
road.
c) Status of Mayport/Atlantic Boulevard Interchange.
d) Request for development of plans for public improvements
in Section H.
5. New Business
A. Request from Peter Mabry for water service to 8 lots in
Ocean Grove.
B. Permission to advertise for bids for construction of
tennis court at City Hall complex and Russell Park.
C. Fire Department Monthly Report - February 1985
D. Temporary appointment of Fire Chief Wayne Royal as
Codes Enforcement Officer
6. Unfinished Business
A. Further consideration request by Stokes 4 Company, developer
of Fairway Villas, that the City clarify/modify restrictions
imposed in recorded plat to allow clearing, landscaping, and
fencing in the area.
7. Report of Committees
A. Committee report and recommendations on proposed purchase
of Buccaneer Utility
8. Action on Resolutions
A. Resolution No. 85-6 - Budget Adjustment
B. Resolution No. 85-7 - Resolution Creating Atlantic Beach
Water and Sewer District #1 .
9. Action on Ordinances
A. Ordinance No. 40-85-13 - Amending Section 3 of Ordinance No.
40-79-9 of the City of Atlantic
Beach, Florida, Granting Non-
Exclusive Franchise to Cox Cable of
Jacksonville Beaches, Inc. , by
Approving Transfer of Non-Exclusive
Franchise from Cox Cable of Jackson-
ville Beaches, Inc. , to Rifkin/
Jacksonville Associates, Ltd. , to
Operate Cable Television Systems in
said City, Providing an Effective
Date. Final Reading - Public Hearing
B. Introduction of an ordinance authorizing the acquisition of
Buccaneer Utilities; authorizing the issuance of not more
than $3.9 million dollars in revenue certificates; setting
a public hearing for April 8, 1985.
10. Miscellaneous Business
ADJOURN
MINUTES OF THE REGULAR MEETING OF THE ATLANTIC BEACH CITY COM-
MISSION HELD AT THE CITY HALL ON MARCH 25, 1985 AT 7:15 P.M. V V
O O
PRESENT: William S. Howell, Mayor-Commissioner T T
Robert B. Cook, Sr. E E
William I. Gulliford, Jr. D D
John W. Morris, Jr.
Catherine G. Van Ness, Commissioners
M S
AND: Richard C. Fellows, City Manager 0 E
Claude L. Mullis, City Attorney T C
Adelaide R. Tucker, City Clerk I 0 Y
NAME OF ONEN
COMMRS. N D S 0
The meeting was called to order by Mayor Howell. The invocation,offered
by Commissioner Cook, was followed by the pledge to the flag.
Approval of the Minutes of March 11, 1985
Motion: The minutes of the meeting of March 11, 1985 be approved Cook x
as presented. Gulliford x
Morris x x
No discussion before the vote. Motion carried unanimously. Van Ness x x
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Howell x
Recognition of Visitors
The Chair recognized Mrs. Ruth Gregg, 905 Sailfisz Drive. Mrs. Gregg
asked if it was legal for Mid Florida to place a $6.00 meter charge
on their customers bills. Mayor Howell replied he had talked with Mid
Florida on the subject and was informed that the Public Service Commis-
sion instructed them to show the charge was levied. He told her to check
her bills and she would see the charge was there all the time but was
not detailed.
Correspondence - None
Advisory Planning Board
A. Commissioner Van Ness had a report of recommendations of the Advi-
sory Planning Board as to:
a) Zoning along Mayport Corridor
b) Request of Sunshine Church for approval of use of private road.
c) Status of Mayport/Atlantic Boulevard Interchange
d) Request for development of plans for public improvements in
Section H
Commissioner Van Ness reported the Advisory Planning Board met on March
19, 1985 at their regular time. All members were present with the ex-
ception of Commissioner Morris who was out of town. Commissioner Van
Ness filled in for Commissioner Morris.
a) Commissioner Van Ness offered for review, a map showing the
Board's recommendations for zoning changes along the Mayport Corridor.
PAGE TWO V V
MINUTES NAME OF
MARCH 27, 1985 COMMRS. MS Y N
Advisory Planning Board - continued
The Board recommended RMH zoning be deleted because it is not appro-
priate or compatible with the area; CG zoning be extended to Atlantic
Blvd, and the westerly portion of RMH zoning would be included in RG-1
district. All of the west side of Mayport Road is presently zoned CG,
and from Donner Road north on the east side is zoned CG. They recommend-
ed CI be deleted and break up that zoning into CG, CL, and ILW for uses
by exception. They also recommended a new zoning be established - CPO,
(Commercial Professional Offices) in the blocks adjoining and abutting
Forrestal and Saratoga Circles. Mayor Howell asked why, in connection
with CPO zoning, the Advisory Planning Board was going to zone certain
lots in that particular subdivsion that have deed restrictions providing
for single family homes only. Commissioner Van Ness replied that Mr.
McCaulie,an attorney, read through the Deeds and Restrictions and did not
read it that way, but did suggest they ask the City Attorney to review
the Deeds and restrictions of that subdivision. Commissioner Morris said
he attended the workshop prior to that meeting and there was considerable
discussion on the subject to prevent spot zoning. It was only a suggestion
that CPO be considered by the Commission as an addition to the city's
zoning. Mayor Howell reminded him that several months back there was a
request by someone who owned one of the lots in question who wanted to
)uild offices on the lot. The Commission turned it down on the basis
_here were deed restrictions against that property. The Mayor expressed
the personal opinion that he was basically opposed to the city establish-
ing a zoning on a particular piece of property that can be used for
other than what the deed restrictions called for, because then the city
could issue a permit to someone to build on a certain lot and then all
you were doing was forcing all those people to spend their money to go
into court to stop it. Mr. Kirkpatrick, 95 Saratoga Circle, furnished
a copy of the covenant and restrictions and Mayor Howell read excerpts:
"11. These covenants are to run with the land and shall be binding
on all the parties and all persons claiming under them until
January 1, 1985, at which time said covenants shall be auto-
matically extended for successive periods of ten (10) years
unless by a vote of the majority of the then owners of the lots
it is agreed to change the said covenants in whole or in part."
Commissioners Morris and Van Ness thanked Mr. Kirkpatrick for his input.
The City Attorney was instructed to review the covenants and restrict-
ions and report back. Commissioner Morris explained the idea was to
break the monotony of too much of one type of zoning running the length
of Mayport Road. The idea on the west side of Mayport Road was the fact
that there were not many establishments there, therefore it would not
disturb as many existing situations by going with CG all the way up
the western side. On the northeastern side, to go with CG, was based
on a survey one of our businessmen residents had done that pointed out
there were twenty-eight existing businesses that would require CG
zoning, and there were only eleven residents in the entire northeastern
area. Commissioner Van Ness stated the impression she had from the
PAGE THREE V V
MINUTES NAME OF
MARCH 25, 1985 COMMRS. M S Y N
Advisory Planning Board - continued
Board was that they felt the private offices of lawyers, doctors, etc.
would protect the homeowners behind them and would be of a more compati-
ble use where it would not create that much traffic.
The Chair recognized Mr. Gerald Saxton, Saratoga Circle,who stated the
Jiffy store customers go in and come out on Saratoga Circle which creates
a definite safety hazard. A bench had also been placed on the corner
that blocked the view of Mayport Road coming out of Saratoga Circle.
Commissioner Van Ness asked the City Manager to check on the bench.
Following discussion, Commissioner Van Ness moved for the following:
Motion: The City Attorney be authorized to prepare an Ordinance Cook x
for presentation to the City Commission to rezone May- Gulliford x x
port Road according to the recommendation of the Advisory Morris x
Planning Board. Van Ness x x
Howell x
Mayor Howellexplained to the audience that the city was just taking
a step and would later hold a Public Hearing on the Ordinance, at
least 60 days from then. The question was called and the motion
tarried unanimously.
b) Commissioner Van Ness reported the Sunshine Community
Evangelical Free Church had asked before that Cornell Lane be extended
for their ingress/egress. The Church had now requested approval for
a change in ingress/egress from Aquatic Drive rather than Cornell Lane.
The road would go up Aquatic Drive and through a portion of the Aquatic
Drive parking lot. The Planning Board discussed the matter at length
and approved the request unanimously for recommendation to the City
Commission. The City Manager advised the original request was granted
by exception. The City Attorney asked if they had an easement and the
Mayor replied in the affirmative.
Motion: Approve the Sunshine Community Evangelical Free Church's Cook x
request subject to the legal review of the easements. Gulliford x x
Morris x
No discussion before the vote. Motion carried unanimously. Van Ness x x
* * * * * * * * * * ;; * * * * * * * * * * * * * * Howell x
c) Commissioner Van Ness reported they also had an update on the
Mayport overpass intersection. DOT is planning to make certain interim
improvements in the intersection by re-timing the lights and widening
the westbound ramp onto Atlantic Blvd. pass Silvers Bar. The other study
on the entire interchange should be completed within several weeks. Gee
and Jenson is making the study.
d) Commission Van Ness stated the Advisory Planning Board requested
the city contact the City of Jacksonville Planning Department and ask
for assistance for a comprehensive plan of some type for the west side
of Mayport Road, Section H. One of the board members suggested that
PAGE FOUR V V
MINUTES NAME OF
MARCH 25, 1985 COMMRS. MSYN
Advisory Planning Board - continued
maybe it would not be unfeasible to designate Section H as a redevelop-
ment area. Commission agreed. The City Manager was instructed to contact
the City of Jacksonville for assistance.
New Business
A. Request from Peter Mabry for water service to 8 lots in Ocean Grove
Mayor Howell acknowledged receipt of written request from Mr. Mabry for
water service to Lots 6, 7, 8, 9, 10, 11, and 12 BLK 6, Ocean Grove
Unit I and Lot 5 BLK 7, Ocean Grove, Unit I.
Motion: Approve the request by Mr. Mabry for water service to Cook x
seven lots in Ocean Grove, Unit I, outside the city limits, Gulliford x x
subject to Mr. Mabry or the developer paying all expenses, Morris x
putting in the proper size mains, and they fully understand Van Ness x x
they are not to be reimbursed for any of their expenses. Howell x
No discussion before the vote. Motion carried unanimously.
* * * * * * >; * * * * * * * * * * * * * * * * * * * * * * * *
Permission to advertise for bids for construction of tennis courts
at City Hall complex and Russell Park
The City Manager provided the Commission information regarding the
situation involving the city's tennis courts and stated the former
Director of Recreation for the City of Jacksonville Beach, an Atlantic
Beach resident, had evaluated the tennis courts, as requested. The Com-
mission budgeted in FY1985 monies for some playground equipment and
maintenance of the tennis courts. Mr. Fellows requested authorization
to advertise for bids on two tennis courts. The playground equipment
could be deferred until the next year to take care of the tennis courts
if the Commission so desired.
Motion: Authorize the City Manager to call for bids to get prices Cook x
on the tennis court improvement and expansion. Gulliford x x
Morris x
During discussion before the vote, Commissioner Gulliford asked if the Van Ness x x
City Manager felt that sufficient money was available to award the bid.
Mr. Fellows stated he had received two quotes from contractors. The city
would only be short approximately $2,500 in order to put in both courts.
The question was called and the motion carried unanimously.
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ;; *
C. Fire Department Monthly Report - February 1985
Che Mayor acknowledged receipt of the Fire Department monthly report for
February 1985. As there were no questions, the Mayor instructed the
report be filed for information.
PAGE FIVE V V
MINUTES NAME OF
MARCH 25, 1985 COMMRS. M S Y N
.e
New Busines - continued
D. Temporary appointment of Fire Chief Wayne Royal as Codes Enforce-
ment Officer.
The City Manager reported that the City Commission had referred that
matter to the Code Enforcement Board for their recommendation. The
Board recommended until it can be determined the level of activity
the Board was going to be engaged in that a temporary appointment
be made. They recommended the City Commission appoint Mr. Royal
for six months.
Motion: Fire Chief Wayne Royal be appointed as Code Enforcement Cook x x
Officer for a period of six months. Gulliford x x
Morris x
No discussion before the vote. Motion carried unanimously. Van Ness x
* * ;; * * ;; * * * * * * * * * * * * * * * * * * * Howell x
Unfinished Business
A. Request for Water and Sewer Service for a Development North
Of the City.
'he City Manager explained the Commission had received in their agenda
packet a letter from Douglas Miller of England-Thims & Miller, Inc.
The item was inadvertently left off the agenda. They were requesting
water and sewer service to their 112 acre development to consist of
about 290 single family units to be constructed over a period of
approximately five years. The developers understand the situation
involving the sewer moratorium. Pending approval of the city to fur-
nish water and sewer, they believed they would get the approval of
DER to put in a dry line network for connection to the city at a
future date. All water and sewer facilities would be constructed
to the city's specifications. Mayor Howell asked if the location was
within Buccaneer's service area. Mr. Strayve of Buccaneer Utility
Company stated the location was adjacent to their franchise area.
Motion: Approve the request for outside the city water and sewer Cook x
services subject to the condition of the moratorium being Gulliford x x
in effect that the city has no control over, and subject Morris x x
to the developers paying all expenses, putting in the Van Ness x
proper lines to the city's specifications, and they fully Howell x
understand they are not to be reimbursed for any of their
expenses.
No discussion before the vote. Motion carried unanimously.
* * * * * * * * * .. * * ;: * * * * * .. * .. * * * * * * * *
B. Further consideration request by Stokes & Company, developer of Fair-
way Villas, that the City clarify/modify restrictions imposed in
recorded plat to allow clearing, landscaping, and fencing in the area.
PAGE SIX V V
MINUTES NAME OF
MARCH 25, 1985 COMMRS. MSYN
Unfinished Business - continued
The City Attorney reported he had met with Mr. Stokes, Mr. Miller, the
surveyor, two lawyers, and other representatives to discuss the matter.
The conclusion was the surveyor had made an error and under the uniform
plat law, he could sign another affidavit and have it recorded to in-
dicate it was not intended. The word "structure" would be included in
the affidavit to include fences and patios as defined in the Code. He
left it with them as it was a private matter as to whether or not the
individual property owners within that subdivision would have the right
to enforce it. The City had no responsibility or jurisdiction over it
except the case of building the garage over the line. Commissioner
Morris expressed concern over the amount of green area that was supposed
to go in that subdivision and what was now happening to it. Mr. Miller
said the green area was exactly the same, the restriction lines were
exactly the same. The definition needed to be amended to be in accord-
ance with the PUD the City approved instead of the definition that was
on the plat, which was in error. Mayor Howell agreed with Commissioner
Morris in his concerns. He said the plat shows that the buffer area
must stay natural. Another City Ordinance provides for anyone who
allows weeds to grow over 12" is in violation of the Ordinance. He
agreed with Commissioner Morris that no building should be allowed in
_he green area, but questioned the point of not being allowed to under-
)rush the area as that would encourage snakes, rats, etc. The intent
apparently was not to allow anyone to build within twenty feet of the
back line, and the Mayor felt the city should honor the intent for all
concerned. Commissioner Morris agreed and felt the city should make sure
any contractor lived up to the letter of what the City approved, and not
bend it or change it.
Mr. Miller explained the PUD Ordinance did not prohibit clearing of the
buffer area. They were not changing anything in the zoning Ordinance
passed by the Commission. They were only trying to correct an error made
originally on the plat. (item 7) Mr. Mullis commented the city was not
doing anything, it was the property owners responsibility. Mayor Howell
said he noticed in the covenants and restrictions there was no mention of
a rear building line. It addressed side lines and front building line
but no rear building line. He asked if the buffer line, as shown on the
plat, was the rear building line. Mr. Miller replied in the affirmative.
In note 7 it read that no structure should be constructed in that area.
Mayor Howell said that note 7 also said you could not clear, build fences,
etc. and if note 7 was going to be changed he wanted to make certain that
the only thing the property owners could do in that area would be under-
brush. Mr Miller agreed and said they were preparing the modifications
to submit to Mr. Mullis.
Commissioner Morris asked Mr. Miller if there was any agreement regarding
sidewalks. Mr. Miller said yes, if he remembered correctly, the plan
called for sidewalks on one side of the street. The City Manager stated
no sidewalks were there at the present time. The Commission reviewed the
approved plan. The sidewalks were shown on the plat.
PAGE SEVEN
MINUTES
MARCH 25, 1985
Unfinished Business - continued
Commissioner Morris asked about the problem of someone's family room
constructed in the buffer zone. Mr. Miller stated the owner went before
the Board of Adjustment and he would either have to get a variance or
he would have to remove the room, like any other violation. The City
Manager commented the Board of Adjustment felt they did not have any
jurisdiction because it was a PUD Ordinance. That was why it came back
to the Commission to make a determination of who had the jurisdiction.
Mayor Howell asked Mr. Miller if he had any knowledge as to why the
sidewalk was not built. Mr. Miller replied in the negative. Commissioner
Morris stated the sidewalks were one of the considerations as at that
time there was no sidewalk on Mayport Road, and he was concerned as
to how the children would get to school, etc.
Mayor Howell asked who was requesting the change and Mr. Miller said the
Developer was requesting the review of the definition of the landscape
buffer. He has been pressured by the existing owners who would like to
clear and landscape their back yards. Mayor Howell suggested the item
be passed over until the Developer comes back to the Commission with
the requested change in the plat. Also, the Developer should come back
and advise when the sidewalks are going to be built and why haven't they.
Chey can discuss the entire matter at one time. Commission agreed. The
2ity Manager will contact the developer.
Report of Committees
A. Committee report and recommendations on proposed purchase of
Buccaneer Utility
Highlights of the Committee Report are attached.
PAGE EIGHT
MINUTES
MARCH 25, 1985
Report of Committees
A. Committee report and recommendations on proposed purchase of Buccaneer Utility
Mayor Howell said they had all received, during the week, a final report on engineer-
ing and the final reports from the CPA's on the Buccaneer's financial status, and
the worth of the equipment on hand, etc.
The Committee meeting held discussions with representatives of Buccaneer, and reached
the conclusion. . .I will briefly give you the rundown on it. The estimated value of
the property and fixtures, equipment, lines, etc. made by Gee & Jenson came to
approximately $4.4 million. The financial approach to the value of it indicated that
there certainly was economically monies coming in to more than operate the system
and pay for bonds and interest, etc. The original offering price of Buccaneer to
the city was 3.9 million. After negotiations with Buccaneer, the following was
reached:
1. The city pay 3.9 million for the facilities.
2. Be paid for with a bond issue which would be strictly from the revenues
from that system. A special water and sewer district to be set up for that
system.
3. The interest rate would be 7.5% unlimited prepayment without penalty after
five years.
4. Buccaneer Utilities would purchase the land adjacent to the sewer plant for the
construction of the proposed 400,000 gallon plant in 1985. They would purchase
that under the option they have with the buyers.
5. They would also pay for and construct the necessary lines to connect the city
of Atlantic Beach water system with the existing Buccaneer water system and they
had a period of not more than 18 months in which to accomplish that.
6. The next thing was they were also to build within a period of sixty days from the
date of closing, a line which would divert the sewage coming from the Buccaneer
Trailer Park, which has nothing to do with Buccaneer Utilities, but which is
presently being served by the City of Atlantic Beach in our sewer system. .They
would pay for diverting that sewage from our system to the Buccaneer treatment
plant which would relieve our system of some 50 to 60,000 gallons of effluent
that we did not have to treat. Possibly, this would induce DER to lift or per-
haps partially lift the moratorium, but certainly at least would aid us in the
treatment in the sewage that we are now accepting.
7. Mr. Strayve and Mr. Braid will stay on with the system until at least through
December 31, 1985 to aid in the running of the system without any cost to the
city.
8. Also, they are to complete the east side lift station which is presently
under construction. The title to all land will be turned over to the city free
and clear.
Mayor Howell stated in the general discussions held, the current employees of Buccaneer have
indicated their willingness and/or desire to transfer in to the employment of the City of
Atlantic Beach. That would provide the city with some very competent sewer operators who are
licensed by the State of Florida for the operation of the plant. Certainly they must know what
they are doing because the system has been consistently getting good marks from DER and EPA.
Having their employees and their expertise with their system come into the employment of our
city would probably, in the long run, improve our own operation.
PAGE NINE
MINUTES
MARCH 25, 1985
Commissioner Cook asked if the purchase would be amortized over a fifteen year period or would
it be paid off in fifteen equal payments. Mr. Wayne Middleton, Touche Ross & Co. stated it
would be a fifteen year amortization schedule of the 3.9 million at 7.5 percent. The interest
will be paid twice a year, and the principal payments will be due once a year annually, so
there will be equal periodic payments (regular amortization schedule where the principal
increases and the interest decreases) . Copies of the amortization schedule were passed out to
the Commissioners for their perusal.
Mayor Howell commented from the report that in 1985 the city would have net revenue over
expenses, before depreciation, $249,393. In 1986, after construction of some $588,000 in sewer
tank, outfall pump station, contingency for large item replacement westside force main, and an
emergency generator, and necessary principal and bond payments, the city would net revenue over
expenses, $1,393,790.00. He also listed revenues anticipated through the year 1990.
Commissioner Gulliford moved to recess for five minutes at 8:16 p.m. The motion was seconded
by Commissioner Morris and carried unanimously.
Mayor Howell called the meeting back to order at 8:21 p.m. Commissioner Morris stated he had
some concerns and the Mayor turned the floor over to him. Commissioner Morris asked for the
Commission's indulgence on his observations of Buccaneer's proposal offered during the
meeting of January 31, 1985 when the proposition was put to Atlantic Beach. He added his
observations were prior to reciving, partly on Friday and the rest on Saturday, the eighty-eight
88) page package of additional material to be reviewed before the meeting scheduled for Monday.
dis observations and questions dealt with paragraphs one through 14 of the proposal.
Paragraph 4 of the proposal read "If the Atlantic Beach rates are applied to the Buccaneer
connections, net cash flow is $5,000" and he asked if the costs for operation were figured on
Atlantic Beach rates or on Buccaneer's.
Mr. Middleton replied they were actual Buccaneer Service Co. 's operation and maintenance ex-
penses. Commissioner Morris said they were projecting the revenues based on Atlantic Beach rates
but not projecting the cost to operate based on what Atlantic Beach had documented in their
records. He asked if anyone knew what the cost would be for Atlantic Beach to operate the
Buccaneer system and expressed the opinion no one had studied that. He added the city system's
operating costs were drastically different than what Touche Ross was projecting. Mayor Howell
said the only expenses they had were existing expenses Buccaneer had experienced.
Commissioner Morris indicated the whole presentation was an assumption and felt it was very
ambitious to go from 1200 connections to 3700 (300% more) in about twenty (20) months. Touche
Ross's report pointed out in several places "however these are projections".
A lengthy debate followed between Commissioner Morris and Commissioner Gulliford on what would
happen if the projected tremendous growth did not come about. Commissioner Gulliford said there
was some validity to Commissioner Morris's concern, as he felt they were all responsible to
assume an adversarial position to the acquisition. That was the only thing they could do. The
revenue less the expense and the net revenue assumes, for the first three or four years, a sub-
stantial amount of impact fees, which of course, is an assumption of a substantial amount of
expansion in the area. In response to Commissioner Morris's question about the operating
expenses if it was done by the City of Atlantic Beach, he said they really couldn't tell. If
you assumed it would cost the city 30, 40 or 50% more to operate the system you have to go to
that net revenue after expenses, after your debt reduction, and see how much latitude the city
had. It appeared to Commissioner Gulliford there was a substantial amount of latitude.
•
PAGE TEN
MINUTES
MARCH 25, 1985
Commissioner Morris agreed if you had all those hookups, and if they were not there, it would
change the bottom figures. Commissioner Gulliford agreed, but added if the projected hookups
were not there you would obviously defer some of the capital outlay expense.
Commissioner Morris expressed concern over the bond payments and said it was not entirely clear
in the 88 page package that payments would be made only from revenues from the system.
Commissioner Gulliford expressed the opinion the bulk of the impact fees for the first year were
more than an assumption. He said Commissioner Morris wanted to argue on the possible limitation
of expansion when it came to the expense side but then he wanted to argue expansion when it came
to the other side.
Commissioner Morris found fault with Buccaneer's operating expenses listed in Hurwitz's report.
They were approximately $260,000 for 1984, but projected $120,000 for 1985.??
Commissioner Morris asked if any business would consider purchasing Buccaneer without review-
ing financials and projecting their own operating costs and profits. The city could base theirs
on their experience in the sewage business.
Commissioner Morris was very concerned over the fact that the city could not increase rates
outside the city without a general rate increase to all users in case projections are not met.
-'aragraph 7 of Buccaneer's proposal states "eligible for grants and other funds from Federal anc
;tate agencies". Commissioner Morris said they should not consider the possibility of grants anc
other Federal funds as the latest information was slanted at cutbacks and elimination of grants,
and added the city just did get under the wire on our new expansion.
Commissioner Morris was very concerned about the rates to be charged households outside the Cit3
connected with Buccaneer.The projections appear to be very profitable, but he questioned the
results if EPA changed their rules.
He was also concerned about the Ordinance wording (page 25) as to who would be responsible for
paying off the debt of the new facility, should costs increase to the point a rate increase
would be required and whether the public would be informed with a Public Hearing. His concern
was whether the citizens of Atlantic Beach may have to pay a higher rate for water and sewer to
handle the bond payments. Commissioner Gulliford stated he believed a Public Hearing on any ratE
increase is required by law. Commissioner Morris stated the proposed Ordinance provides that if
the annual report indicated that rates should be increased substantially pro rata as to all
classes of service, then, to the full extent permitted by law, the City shall raise the rates
and charges for service, without the necessity of notice or public hearing. Mr. Mullis said
"if permitted by law, which it isn't" and Commissioner Morris commented Mr. Mullis was playing
on words. If it was not permitted by law, then why did he even put it in there.
Commissioner Morris questioned whether we need the additional water capacity from the Buccaneer
wells. The water supply of our city was more than sufficient to supply our present requirements,
and the more shallow wells of the new utility were not considered necessary for our city. The
cost of that portion of the Buccaneer Utility firm was considered superfluous and the $437,000
cost of the waterworks seemed to be more than we needed to spend. The city has five million,
almost six million gallons a day capacity, and if he read the figures right, was enough to serve
like 15,000 hook-ups. Our city has enough water to furnish the island, north of Atlantic Blvd.
already paid for. The distribution lines included in the $437,000 may not be a bad deal to have.
PAGE ELEVEN
MINUTES
MARCH 25, 1985
Commissioner Morris was concerned about the merging of the two water systems and how the bonds
would be paid off if those wells and lines connected. He asked who would get the development
Doug Miller would be building north of Selva Norte. Commissioner Gulliford stated they have
service districts.
He questioned whether an engineer other than Gee and Jensen had checked out the bridge and pier
and whether the bridge and pier were better than having the pipe on the bottom. There were
concerns regarding the sewer outfall line being large enough and stable enough to handle both
pipes. This appeared to be an additional cost item, part of the $3.9 million, but $75,000 for
items that may not be adequate.
The reference to the additional office space was another concern since the 23,000sq. ft. with
1600 sq.ft. garage and covered and uncovered parking area increased the figure asked by
$350,000, part of the total asking price. The matter of all the expansive office space was
considered unnecessary for our City.
Under paragraph 13, 'Economy of Operations per connection' was of further concern since the
working space seemed to carry a rather high price.
Various items were mentioned that appear to be duplications with Atlantic Beach. (Tax and
Regulatory Costs Deleted, Par. 14) Reference to the benefit to the local taxpayer, resident and
customer appear to be short of sufficient explanation as to effects.
commissioner Morris was very concerned with the fact the sewer system has not been adequate nor
profitable for the City of Atlantic Beach in that we are under a moratorium until new facilities
are completed. There does not appear to be any sure way to make the sewer business self-sustain-
ing since the raising of rates had been reluctantly considered by the city for expansion and
maintenance.
The auditor's report was referred to at length with concern that the anticipated hookups may not
materialize.
The use of present personnel to handle anticipated re-surfacing and widening of Seminole Road,
installation of water and sewer lines west of Mayport Road, the replacement of old water and
sewer lines in Royal Palms was another concern. The question was whether we would be prudent to
allow a higher priority to a project outside the City?
For the record, Commissioner Morris voiced his objection to the big rush for a decision to be
made on 88 pages of technical data that was delivered part Friday, and part Saturday, that
required a vote to obligate the City of Atlantic Beach for 3.9 million dollars sewer plant to bE
decided on Monday. He thought that was a bit fast for a project of that size.
There was additional concern on the price quoted as the final price. The Hurwitz figure of 2.23
million dollars shown for assets on the book value of the plant, and the replacement value of
4.39 million less depreciation, appears to be an excellent deal for the seller. Commissioner
Gulliford commented if you look at acquisitions of business, you will find a great deal is
predicated on future earnings, and not on the book value of the assets.
Commissioner Morris was concerned about who made the projection, whether made by our auditor or
the seller's auditor. Commissioner Gulliford explained the projection was based on some histori-
cal fact as well as projections of what may occur to affect revenues over the following period.
PAGE TWELVE
MINUTES
MARCH 25, 1985
Commissioner Morris expressed concern the figures appear to be so great there has to be a case
of diabetes somewhere in all the figures. The loss shown for 1983 of $119,800 and 1984 loss of
$63,800 from the Schedule of Operating Expenses were another serious concern. Commissioner
Gulliford suggested all the figures be considered, particularly the General Administrative
Expense and the Interest Expense. The Administrative expense would be replaced, and interest
expense would be treated differently. The chief executive officer's salary was discussed, which
was considerably more than the salary for the mayor. (some $50,000 on page 7) Total General
Administrative expenses totaled $128,000.
The book value was also discussed at length. Commissioner Morris could not understand Commis-
sioner Gulliford being on the committee and not considering the book value of the business. That
would have been the first thing he looked at, 2.3 million. Then he would have negotiated based
on the book value of the plant, not taking the replacement value, that was what he would insure
for.$3.9million is a long way from $2.3 million. Mr. Mullis noted they had only determined the
true value (that was determined by the Supreme Court of Florida and General Waterworks vs Dade
County) .That is the appropriate method of determining value, reproduction cost less deprecia-
tion. Commissioner Morris commented it was according to whether you were buying or selling.
Commissioner Morris was very concerned about the projected hook-ups and the cost for the
addition of each and every one who becomes a customer. Could not reconcile figures furnished.
Commissioner Gulliford pointed out that the majority of the new hookups would come in the futur(
- '85 and '86. Commissioner Morris discussed further that the plant had been in existence since
1974 with 1200 hookups in ten years, with the average of 20 per year since that date. He was
:oncerned with the possibility of reaching 3700 in the next 20 months, with 120 per month
difficult to accept. Commissioner Morris questioned many things on the report, 1) the optimism
of that many hookups, and 2) the optimism of that low of a operating cost for that many hookups,
Mr. Middleton said they had signed letters from every one of the developers that had nothing
to do with Buccaneer. Touche Ross independently wrote to each one of them and said "do you plan
on doing this" and each one of them came back and said, 'yes, we do, in fact we would like to do
it sooner, but Buccaneer is in negotiation and won't even talk to us' . He said they had
confirmed hookups from 1200 to 3700 . Mr. Strayve stated Buccaneer Utility does have 2490 plus.
Those are signed contracts. Impact fees have been realized. For the others, in addition to that
he said he had seen the letters Touche Ross received and I think the Committee saw them. The
developers do want to sign contracts but Buccaneer would not.
Commissioner Gulliford said the doubts expressed were not considered valid since everyone knew
of the expansion of the Mayport Naval Station, and the fact there is very limited land available
in the Buccaneer service area. Someone had to develop and be able to service the expansion of
the whole northern end - particularly the Mayport Naval Station. Commissioner Morris said the
Navy would furnish their own water and other requirements. Mr. Strayve advised for the 400 unit;
now they have their own well. For their additional commissary, exchange, child care center and
if they do go (at this time they are not going to build additional housings they have verbally
requested Buccaneer to take all future expansion, and consider providing water to the present
400 units. When Buccaneer signed a contract with the Navy they were not in their franchise area
but they are now, and they grandfathered the previous water in.
Other concerns were shared by Commissioner Morris, including the Touche Ross spread sheet.
A copy of his concerns and objections and observations of the Buccaneer Proposal are attached
hereto and made a part hereof.
PAGE THIRTEEN
MINUTES
MARCH 25, 1985
During discussion of the Gee & Jenson report, Commissioner Morris said they had better consider
the 1988 plant expansion to come in at '86 -'87,if all the hookups come in, which would require
expenditures earlier in the program.
He also reminded the Commission they were not obligating for $3.9 million. The payout for
fifteen years would be $6.2 million.
Mr. Fellows memorandum was discussed. Commissioner Morris commented out of 88 pages delivered tc
him over the weekend, there was only one shred of hope he could find. That was an excerpt from
Mr. Fellows memorandum "The citizens of Atlantic Beach may in the long run, eliminate the need
for increasing utility rates."
The Ordinance was discussed at length in reference to the bond holder. Mr. Mullis explained the
proper procedures and requirements of the State of Florida on bond issues.
Commissioner Morris concluded his concerns by thanking the individuals who helped put his report
together and also thanked the Commission for their indulgence.
Commissioner Cook asked why all of that had not been presented to the Committee and Commissioner
Morris stated he had been out of town. Commissioner Cook asked if the Committee had a
recommendation and Mayor Howell advised the Committee recommended the city purchase Buccaneer
Utility at 3.9 million.
;ommissioner Cook moved for passage of Ordinance 80-85-26 on first reading.
Mayor Howell advised they were still on the Committee report and the motion would be out of
order at that time. Commissioner Cook withdrew his motion.
Commissioner Gulliford questioned Commissioner Morris's statement Buccaneer Utility Co. was
overpriced. He asked relative to what. Commissioner Morris replied, to book value according to
Hurwitz's statement. Mr. Strayve commented that book value for the PSC is different than book
value for ordinary business. Book value for PSC does not include on site land, as in ordinary
business. That leaves Buccaneer a $3.9 million plus plant. That did not include the $32,000
they were paying for the extra two lots.
Commissioner Gulliford expressed his opinions on the projected hookups. He said the projected
1985 based on what the CPA advised was really going to be actual '85. They had some basis to
believe that a good portion of that increase in 1986 is more than a pure projection and is base(
on some factual contact that Mr.Strayve's firm had made. Mr. Strayve confirmed that 1986 was
pretty close to being actual also. Commissioner Morris did not agree as things could change.
Discussion was held on the amount of land involved and if it was enough for expansion.
Mr. Strayve advised they have bought the adjacent property included in the agreement. They have
purchased a third lot for the third tank, and have a signed contract with a down payment, which
will be closed in approximately thirty (30) days for two more lots. They have a full lot avail-
able for sludge beds, (100' x 80') which should take them to the year 2000.
Commissioner Gulliford asked Commissioner Morris to look at the specifics of the report relative
to the contracts, etc. and perhaps that would satisfy his concerns relative to revenues. He pro-
jected assumed revenues for 1986 and the net would be just over one million. That would be afte]
paying the bond. He used the historical expense figures on operating the plant for his
calculations. He also stated there are outside contractual services who could operate the plant
PAGE FOURTEEN
MINUTES
MARCH 25, 1985
Commissioners Gulliford and Morris continued their debate on the projections of expense and
revenues. Mr. Middleton said, from a CPA point of view, that Touche Ross was hired by the
City of Atlantic Beach to make the report. Commissioner Morris asked who paid them. Mr.
Middleton said it was agreed that Buccaneer Service would pay them. Commissioner Morris asked
then who he was working for, and added the person that pays is who he would be working for.
Mr. Middleton stated he was questioning his independence, and Commissioner Morris apologized
saying that was not his intent. Mr. Middleton dealt on the facts presented to him, and Commis-
sioner Morris had no problem with him. Mr. Middleton said the reason Buccaneer didn't make any
money (they lost $63,000 last year) was that $78,000 was interest. That obligation would not
enter into the city's purchase. If you take the interest out, Buccaneer made a profit of
$15,000 for the year ending 12/31/84 on a regulatory basis which is not generally accepted
accounting principles. This was on a cost basis investment of 2.2 million. He reminded them
the city will not have any regulatory commission expense because they would not be covered by
the PSC, and no taxes. Commissioner Morris suggested the PSC expense remain projected as there
could be changes. Mr. Middleton assured them at the end of 1985 through 1990 assuming the pro-
jections are good (just the ones they know about and the developers have paid for) times city
of Atlantic Beach rates at 1 1/2 times those rates, there would be enough revenue to cover the
expense of principal and interest on bond amortization and would require no outlay at all from
any other source. There did not have to be any more growth at all. There was enough to pay right
now for a 15 year amortization. Commissioner Gulliford stated the net, after the debt reduction.
would run $ 1, 174,590. in 1986 and $889,736 in 1987, $760,000 in 1988, $616,000 in 1989. That
was after the $350,000.
:ommissioner Morris asked Mr. Strayve if he would consider re-writing the contract, based on
those guarantees. Mr. Strayve replied they were absolutely certain that the city will never go
negative in paying PI and operation expenses vs revenue, and if Commissioner Morris doubted
that, he would write that in the contract. He then asked if there were any bonuses going the
other way. Commissioner Morris said no.
Commissioner Gulliford suggested the Mayor appoint Commissioner Morris a committee of one to
negotiate with Mr. Strayve. Commissioner Morris commented if he was a committee of one, he woulc
have the engineer that has been working with the city since 1982 and pay him to study the whole
project before considering the purchase. Commissioner Gulliford stated the sewer is a stand
alone system and he was not worried about the water.
Discussion followed on the water plants. Mr. Potter,engineer for Buccaneer offered input on
their plant.
Commissioner Gulliford addressed Bates report that Commissioner Morris addressed earlier. He
said it was all tied to the benefit to the citizens of the community. The Bates report also
was projecting rate increases in the next ten years, possibly two or three. He made the
assumption that they had two classes of customers basically equal. He expressed the opinion tha
the 150% rate payers would be subsidizing the 100% rate payers (inside city) . He said if an
increase was necessary, the citizens of Atlantic Beach would only be paying $1.00 where outside
the city a substantial amount of people would be paying $1.50. He also expressed the opinion
that in 3 1/2 to 5 years the city would reach their capacity of sewer.
In conclusion, Mayor Howell advised any action taken by the Board that night did nothing but
pass an Ordinance on first reading which would have to go to a Public Hearing on April 8,1985.
Mr. Mullis said they would adopt the Resolution creating a sewer service district in the event
the city proceed to final adoption of the Ordinance to authorize the issuance of the bonds to
acquire the system which has been set up under the Statutes. The earliest possible time to clos
the transaction would be May 15, 1985.
PAGE FIFTEEN V V
MINUTES NAME OF
MARCH 25, 1985 COMMRS. MS Y N
. . - --
Action on Resolutions
A. Resolution No. 85-6
Mayor Howell presented and read in full Resolution No. 85-6,a Resolu-
tion transferring certain monies between funds. He said the Resolution
added revenue from private sources and an expenditure in the amount of
$12,816. for the purpose of buying a generator for the emergency lift
station.
Motion: Move for passage of Resolution No. 85-6. Cook x
Gulliford x x
No discussion before the vote. Motion carried unanimously. Morris x
Van Ness x x
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Howell x
B. Resolution No. 85-7
Mayor Howell presented in full Resolution No. 85-7, A Resolution Pro-
posing to extend the utility system of the City of Atlantic Beach by
the acquisition of the water and sewer system now owned and operated
by Buccaneer Service Company, Inc. , describing the project and its
)urpose, the proposed territory to be included and served by the
itility, a general description of bonds to be issued to finance the
acquisition, and the cost of the project; making a determination that
the purchase is in the Public interest; calling for a Public Hearing
on such proposal; and providing an effective date.
Motion: Move for passage of Resolution No. 85-7. Cook x x
Gulliford x x
Morris x
No discussion before the vote. Motion carried four to one. Van Ness x
Commissioner Morris voted no. Howell x
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
Action on Ordinances
A. Ordinance No. 40-85-13 FINAL READING - PUBLIC HEARING
AN ORDINANCE AMENDING SECTION 3 OF ORDINANCE No. 40-79-9 of the
CITY OF ATLANTIC BEACH, FLORIDA, GRANTING NON-EXCLUSIVE FRANCHISE
TO COX CABLE OF JACKSONVILLE BEACHES, INC. BY APPROVING TRANSFER
OF NON-EXCLUSIVE FRANCHISE FROM COX CABLE OF JACKSONVILLE BEACHES
INC. , TO REFKIN/JACKSONVILLE ASSOCIATES, LTD. , TO OPERATE CABLE
TELEVISION SYSTEMS IN SAID CITY, PROVIDING AN EFFECTIVE DATE.
Said Ordinance was presented by Mayor Howell, in full, in writing for
second and final reading. Said Ordinance was posted in line with Charter
requirements. The Mayor then opened the floor for a Public Hearing. As
no one spoke for or against, the Mayor declared the meeting closed.
PAGE SIXTEEN V V
MINUTES NAME OF
MARCH 25, 1985 COMMRS. MS Y N
Action on Ordinances - continued
Motion: Move for passage of Ordinance No. 40-85-13 on second and Cook x
final reading. Gulliford x x
Morris x
No discussion before the vote. Motion carried unanimously. Van Ness x x
;ti k * * ;: * * * * * * * * * * * * * * * * * ;; ;: x ;: * Howell x
B.ORDINANCE NO. 80-85-26
AN ORDINANCE AUTHORIZING THE ACQUISITION OF BUCCANEER UTILITIES;
AUTHORIZING THE ACQUISITION OF BUCCANEER UTILITIES, AUTHORIZING
THE ISSUANCE OF NOT MORE THAN $3.9 MILLION DOLLARS IN REVENUE
CERTIFICATES; SETTING A PUBLIC HEARING FOR APRIL 8, 1985.
Said Ordinance was presented by Mayor Howell in full, in writing,
on first reading. .
Motion: Move for passage of Ordinance No. 80-85-26 on first Cook x x
reading. Gulliford x x
Morris x
During discussion before the vote, Commissioner Morris requested Van Nes x
,onsideration on changing some wording in the Ordinance. He also Howell x
asked the Commission to please study it over. The question was
called and the motion carried with a three to two vote. Commissioners
Morris and Van Ness voted nay.
Mayor Howell set the Public Hearing for April 8, 1985 at 7 :15 p.m.
Miscellaneous Business
Commissioner Cook commended Commissioner Morris for the tremendous
amount of work he had done on the Buccaneer proposal.
Commissioner Gulliford asked if an accident had occurred within the
past couple of days at the intersection of first and Ocean, the
same area he discussed at the last meeting. No one had knowledge
of an accident at that location.
There being no other business to come before the Commission, the Mayor
declared the meeting adjourned at 10:59 p.m. .
Seal , illia . 'owell
Mayor/Presiding Officer
ATTEST:
Adelaide R...Tucker,CMC
City Clerk
March 25, 1985
Concerns and Objections
Objection: 1. The big rush .for a decision, to be made on 88 pages of
technical data that was delivered - part Friday - 'part
Saturday - that requires a vote to obligate the City for
$3 . 9 MM - on Monday.
Concern: 2. The asking price of $3. 9 MM is based on replacement
value $4. 39 MM (G & J page 2) less depreciation.
While the book value (Hurwitz page 4) - assets are
$2.23 MM.
Concern: 3. For a supposedly "Sweet Deal" (Hurwitz -page 6) shows
1 v15Es of-1983 - ( $119 . 8 M) and 1984 - ($63. 8 M) .
Concern : 4. (A) Compare (Hurwitz page 7) "Schedule of Operating
Expenses"
1984 - operations $113 . 5 M + Gen. & Admin. 128. 7 +
maint. 19 . 1
For a total of $261 . 4 P4
(B) See (Touche Ross Spread Sheet Page 1- 3/21/85)
"Statement of Forecasted Revenues and Expenses"
Forecasting only 1985 - 120M 1986 - 130 . 8M -
Is this enough?
(C) How can this be? in (AB ' 83-' 84 Oper. Budget) -
Cost was 223 Sewer; 127 Water - Total $35014
- This is based on approx. the same equivalent
connections as their 1985 of 2, 492 connections
Buccaneer and 2, 499F"`A.B.
(D) See (Touche Ross Spread Sheet) - 1985 - 2, 492 Customers
1986 - 3, 737 customers - and apply A.B. rates X 1;
- Why the difference?
(E) See (Touche Ross Spread Sheet) - "Projected Equivalent
Connections"
Today they have 1200 - expect + 800 = 2M now -(see
Buccaneer Sales offer to A.B . (Par: 2) ) -
From here on is pure projection and the whole
proposal is based on How many connections are
served.
(F) See (Touche Ross Spread Sheet - page 1) and compare -
Now 1200 - soon 2 , 000 - but they say 1985 @ 2, 492
Then 1986 @ 3, 737?? That's 300+% increase in hookups
over actual - Have to average 126 hookups per month
for the next 20 months.
Now keep this spread sheet open - and take the (Gee and
Jenson report - page 8) .
-1-
Mn-ch 25, 1985
(G) See where it says (Par: 4) Equivalent Residential Unit
Sewer ERU + 275 GPD - This means 1 connection uses
275 GPD/ 3737 connections would use 1, 027 GPD -
this would put the Plant at maximum in 1986 (Currently
has 650M GPD - adding 400M in 1986 .
This would require the 1988 Plant expansion to come in
' 86- - ' 87 , if they come in.
(H) Incidentally - see (Bates Sewer Rate Study - June, 1982)
Page 4-17 Sewer Treatment in 1981 the unit operating
expense $ per connection - was $63 .22 (X 3737 = $236M
sewer only) No water expense - we could estimate
water in 1986 @ 130M for a total of $366M operating
expense.
(I) Go back to (Gee & Jensen - page 8) Par: 5 - see the
limitations on the St. Johns River Outfall (page 9)
Disposal Facility 1, 571 ERU This limits the 650M GPD
Plant to 432M GPD - This is fact now and they are
projecting 2, 492 this year::.
- Also the Water Treatment Permit is for 893 ERU -
- Is this a problem?
Concern: 5 See Bond Payout (Canary Sheet)
Payout - 15 years @$260M principal per year.
(A) Plus interest on Bal @ 292. 5M the first year
Total $552 . 5M - just to pay the Bond Notes !
With projected 2492 connections = f221 . 70 per connection
Just for Principal & Interest Payments. Gross revenues
will be $318.00 per copnection. Before operating
expense of ? 120M or 1350M?
(B) See (Canary Sheet - Bond Payout)
-A.B. is not obligating for $3. 9 MM
-The payout is 56 .2 MM.
(C) And the on;y thin hope in all these pages is in ( 3/22/85 -
memorandum from Richard Fellows) Point 8.
i ---"May in the long run, eliminate the need for
' increasing utility rates . "
Concern: 6 See (Ordinance Accepting the Offer)
Page 21 (E) "Will always provide gross revenues ---
This is a cost plus ordinance .
- Now go to page 25 (Item "0" continued from page 24)
- Provides for rate increases without notice or Public
Hearing.
Concern : 7 Where, in all of this will the Citizens of A.B. be best
served - 7
-2-
RESOLUTION NO. 85-6
A RESOLUTION TRANSFERRING CERTAIN MONIES BETWEEN FUNDS
WHEREAS, the City Charter of the City of Atlantic BEach requires
that the City Commission approve all budgetary increases and transfers
from one fund to another, and
WHEREAS, the nature of budgetary systems and those day to day
decisions affecting such budgetary systems require adjustment from time
to time,
NOW, THEREFORE, BE IT RESOLVED by the City Commission of the City
of Atlantic Beach, that the attached Budget Adjustment No. 85-6 be
approved for the 1984-85 Budget.
* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
William S. Howell, Mayor
Presiding Officer
(SEAL)
ATTEST:
Adelaide R. Tucker, CMC
City Clerk
Approved as to Form
and Correctness:
Claude L. Mullis, City Attorney
' BUDGET ADJUSTMENT
IA NUMBER: 85-4 Date: MARCH 25, 1985
FUND: Sewer
IS EPARATE FORMS FOR EACH FUND
MOUNTS MUST BE IN WHOLE DOLLARS
CCOUNT ACCOUNT TITLE EXPENDITURE REVENUE
ADD DEDUCT DEDUCT ADD
1-535-640 ) Machinery & Equipment 12, 816
:1-366-200 ) Contributions and D .onations
from Private Sources 12 , 816
XPLANATION: To provide budgetary authority to receive and expend monies
from Selva Norte subdivision for the purchase of emergency pump to be
ised at lift stations.
N] TED BY Richard C. Fellows DATE: 3/25/85
OMMISSION ACTION REQUIRED: Yes DATE RECEIVED:
RESOLUTION NO. 85-7
A RESOLUTION PROPOSING TO EXTEND THE UTILITY SYSTEM
OF THE CITY OF ATLANTIC BEACH BY THE ACQUISITION OF
THE WATER AND SEWER SYSTEM NOW OWNED AND
OPERATED BY BUCCANEER SERVICE COMPANY, INC.,
DESCRIBING THE PROJECT AND ITS PURPOSE, THE PROPOSED
TERRITORY TO BE INCLUDED AND SERVED BY THE UTILITY,
A GENERAL DESCRIPTION OF BONDS TO BE ISSUED TO
FINANCE THE ACQUISITION, AND THE COST OF THE
PROJECT; MAKING A DETERMINATION THAT THE PURCHASE
IS IN THE PUBLIC INTEREST; CALLING FOR A PUBLIC
HEARING ON SUCH PROPOSAL; AND PROVIDING AN
EFFECTIVE DATE.
WHEREAS, the City of Atlantic Beach proposes to extend its water and sewer
utility system by acquiring the assets of Buccaneer Service Company, Inc., through the
purchase of all of its stock and immediate liquidation of the corporation; and
WHEREAS, the City has made a careful study of the public interest in such an
acquisition; NOW THEREFORE
BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF ATLANTIC
BEACH, FLORIDA:
Section 1. The City hereby finds and determines that the extension of its
water and sewer utility system by the acquisition of the assets of Buccaneer Service
Company, Inc., through the purchase of all of its stock and the immediate liquidation of
the corporation, is in the public interest. The City has considered, at a minimum, in
making such determination, the following:
(a) the most recent available income and expense statement for the
utility system;
(b) the most recent available balance sheet for the utility system,
listing the assets and liabilities and clearly showing the amount of contributions-in-aid-of
construction and the accumulated depreciation thereon;
(c) a statement of the existing rate base of the utility for regulatory
purposes;
LKL-03/21/85-183A-2034 -1-
(d) the physical condition of the utility facilities being purchased;
(e) the reasonableness of the purchase price and the terms of
purchase;
(f) the impacts of the purchase on the customers of the utility system,
both positive and negative;
(g) any additional investment required and the ability and willingness
of the City to make that investment;
(h) the alternatives to the purchase and the potential impact on utility
customers if the purchase is not made; and
(i) the ability of the City to provide and maintain high quality and
cost effective utility service.
Section 2. The City has prepared a statement showing that the purchase is in
the public interest, including a summary of the City's experience in water and sewer
utility operation and the showing of financial ability to provide the service, a preliminary
draft of which is attached as Exhibit "A" hereto.
Section 3. The utility to be extended is the City's existing water and sewer
utility system, and the proposed extension consists of acquisition of the water and sewer
system presently owned and operated by Buccaneer Service Company, Inc., a more
particular description of which is set forth in the draft of the Stock Purchase Agreement
attached hereto as Exhibit "B". The proposed territory to be included in the project and
served by the acquired utility system consists of the proposed Water and Sewer District I
area, more particularly described in the Stock Purchase Agreement. The cost of acquiring
the project is the amount set forth in the Stock Purchase Agreement, which shall be
financed in part by the issuance of Water and Sewer District I Revenue Bonds of the City,
also more particularly described in the Stock Purchase Agreement.
LKL-03/21/85-183A-2034 -2-
Section 4. A public hearing shall be held at 7:15 o'clock p.m. on April 8, 1985,
at the City Commission chambers in City Hall, City of Atlantic Beach, Florida, at which
time all interested persons may be heard on the proposed acquisition, the proposed
financing, and the proposed establishment of Water and Sewer District I, in the manner
described herein and in the proposed ordinance relating to this subject which has been
introduced and passed on first reading at the same meeting as this resolution is adopted.
Section 5. Pursuant to Section 180.04, Florida Statutes (1983), an ordinance
approving the execution of the Stock Purchase Agreement, the issuance of the Bonds, and
the establishment of Water and Sewer District I, will be considered on second reading,
following such public hearing, but will not be finally enacted earlier than May 1, 1985.
Section 6. This resolution shall become effective immediately upon its
adoption.
Adopted on March 25 , 1985.
Approved as to form and correctness:
:/;1(-4•( 717kAA A/
ity Attorney I
At/
a or
Attest:
CF"WICATION
I cer ify taus to be a true and correct
copy of tho record in my office.
City Clerk WITNESSETH my hand and official seal
of the City of Atlantic Beach, Florida,.
this the day of 127e ,„,/A_..-
19 .
--.:City Clerk
LKL-03/22/85-183A-2034 -3-