Loading...
HomeMy WebLinkAboutMinutes_Special Meeting_02/24/1998F Tf v r ~~ Gf J'~ ~. ' ra ~ ° c a~ 4~ 4pN CO ~ VILLAGE OF TEQUESTA Pos[ Office tiox 3273 3~7 Tequesta I)ri~~c Tequesta, Floi7d<i 3369-0373 (?61) 57~~i200 Fax:(7C1) 57~-6203 VILLAGE OF TEQUESTA SPECIAL VILLAGE COUNCIL MEETING MINUTES FEBRUARY 24, 1998 I. CALL TO ORDER AND ROLL CALL The Tequesta Village Council held a special meeting at the Village Hall, 357 Tequesta Drive, Tequesta, Florida, on • Tuesday, February 24, 1998. The meeting was called to order at 7:03 P.M. by Mayor Elizabeth A. Schauer. A roll call was taken by Betty Laur, Recording Secretary. Councilmembers present were: Mayor Elizabeth A. Schauer, Alexander W. Cameron, Joseph N. Capretta and Ron T. Mackail. Also in attendance were: Village Manager Thomas G. Bradford, Village Clerk Joann Manganiello, and Department Heads. Vice Mayor Carl C. Hansen was absent from the meeting. II. APPROVAL OF AGENDA Councilmember Mackail made a motion to approve the Agenda as submitted. Councilmember Cameron seconded the motion. The vote on the motion was: Elizabeth A. Schauer - for Alexander w. Cameron - for Joseph N. Capretta - for Ron T. Mackail - for • The motion was therefore passed and adopted and the Agenda was approved as submitted. KecPClecl Paper • SPECIAL VILLAGE COUNCIL MEETING MINUTES February 24, 1998 PAGE 2 ------------------------------------------ III, COMbI[TNICATIONS FROM CITIZENS (NON-AGENDA ITEMS) There were no communications from citizens. IV. CONSIDERATION OF SEACOAST UTILITY AUTHORITY OUTLINE FOR MERGER OF TEQUESTA NATER DEPARTMENT PITH SEACOAST UTILITY AUTHORITY A) Status of RO Plant Construction Bids B) Financing (Bonds) Timetable C) Seacoast Utility Authority Outline Mayor Schauer announced that item tC) would be considered before (A) and (B) . • Councilmember Mackail expressed his opinion that the Seacoast offer was not a bargain and it would be in the best interests of the Village to retain the Water Department and keep it in perpetuity, looking at future earnings potential. Councilmember Mackail commented that Seacoast would have to run the water through the Town of Jupiter and that if Tequesta kept the Water Department they would have control over their own future. Councilmember Mackail stated his position as not in favor of selling to Seacoast for $9,000,000 or the Town of Jupiter for $8,000,000. Councilmember Cameron expressed his opinion that an offer from a reputable, substantial, non-political organization offering the residents cheaper water and the village approximately $9,000,000 in cash, offering to end the lawsuits with Jupiter, to keep Tequesta Water Department employees, and to give Tequesta a seat on their board, must be seriously considered. Councilmember Cameron expressed reservations regarding the fact that cooperation with Jupiter would be necessary for the life of the contract. • Councilmember Capretta listed three strategies for • SPECIAL VILLAGE COUNCIL MEETING MINUTES February 24, 1998 PAGE 3 ------------------------------------------ consideration: 1) Regional Concept: Accepting the offer from Seacoast would offer the opportunity to establish a regional water system, since Seacoast now serves all the northern Palm Beach County cities except Jupiter and Tequesta. 2} Home Rule: The Village of Tequesta has been aggressive in maintaining home rule with their own fire department, paramedics, and water department; and residents believe in having the ability to control those departments. 3) Business Approach: The Village knows the Water Department is a profitable business which makes a profit of $500,000 to $700,000 annually. Selling to Seacoast would in effect provide an annuity which, through a counter offer, • could bring in $12,000,000 cash which could pay the Village $700,000 annually forever, guarantee continued employment for Tequesta Water Department employees, as well as anything else the Village might be interested in requesting. Councilmember Capretta stated that the village Council must decide at tonight's meeting whether to accept or reject the Seacoast offer, or to grant a 30-day extension and define what would be acceptable. Mayor Schauer stated she did not like the Seacoast offer. Mayor Schauer commented that the Water Department has 14 employees and Seacoast would only hire 12, and they might not keep those employees after their own employees had learned the system. Mayor Schauer also expressed her opinion that the transaction cost offered was too low. Mayor Schauer stated she would like to reject the Seacoast offer and go on with the bonds and the RO plant and forget about the Water Department being for sale. • village Manager Bradford explained that Vice Mayor Hansen had telephoned from Denver to state his position, which was that • SPECIAL VILLAGE COUNCIL MEETING MINUTES February 24, 1998 PAGE 4 ------------------------------------------ he was opposed to the Seacoast offer. Vice Mayor Hansen requested that if a majority of the Village Council wished to go forward that he insisted on including a reverter clause in the contract whereby if Seacoast attempted to sell the utility at a later date to the Town of Jupiter that it would revert back to the Village of Tequesta. The vice Mayor expressed concern regarding the heavy reliance of Seacoast on the Town of Jupiter to make this deal happen. Councilmember Capretta commented the Village could keep the Water Department as is, or could keep it and plan to expand, and that one of the reasons both Jupiter and Seacoast wanted to purchase the water Department was because of Tequesta's strategic location which would allow them to expand north into Martin County. Councilmember Capretta explained that the Water Department could be sold at a later date, but the • present urgency to make a decision was due to the fact that the Village was ready to float bonds to build the RO plant, that bids were already in, and the bids would expire on April 13. The village did not want the bids to expire because they had come in lower than predicted by the engineers, and to let them expire and have to re-bid might add as much as a million dollars to the cost. Councilmember Capretta commented that the decision must be made whether to negotiate or to stay with home rule, and that he believed $9 million was too low because of Tequesta's location as the entrance into Martin County with the potential for expansion. Councilmember Cameron questioned how much control South Florida Water Management District had over the water supply. village Manager Bradford explained that SFWMD issued a consumptive use permit which set limits on how much water could be taken from the surficial aquifer and the Florida aquifer and that Tequesta had been granted a 10-year permit, which they might alter but would probably would not take away. Restrictions imposed during droughts were by Village Ordinance; however, they had originated with SFWMD. • Councilmember Mackail commented that the water Plant should . SPECIAL VILLAGE COUNCIL MEETING MINUTES February 24, 1998 PAGE 5 ------------------------------------------ have expanded five years ago; that expansion to the north was feasible since Hobe Sound was experiencing salt water intrusion, and growth potential was the reason Jupiter and Seacoast wanted to purchase the water system. Councilmember Mackail expressed his opinion that the Village should be looking at adding additional trains to the RO plant right away. Councilmember Cameron stated he agreed with Councilmember Mackail businesswise, but expressed concern as to whether Tequesta would be squeezed out by the bigger entities of Seacoast, Jupiter, etc., in the future if water became scarce. Bill Reese, Reese Macon & Associates, explained that SFWMD allocated water among legal users, that Tequesta was a legal user, and that requests for higher amounts of water were carefully considered as to the impact on other users. Mr. Reese explained that SFWMD tended to overcompensate in favor of existing legal users and to disallow additional impacts. Mr. Reese explained that as the water Department grew, Tequesta would have to request an increase in their consumptive use permit, and at this stage the challenge to get more water from an RO plant was nowhere near the challenge to get more water from than the surficial aquifer, as evidenced by the fact that everyone was building RO plants. Mayor Schauer commented that studies had shown that by putting sewers in the peninsula that there would be saltwater intrusion into the wells, which would mean more water demand in the future for irrigation purposes. Mayor Schauer questioned whether if the Village kept the Water Plant and built an RO plant, those needs could be met, to which Mr. Reese responded that all growth projections had been taken into account in designing the RO plant, and additional trains could be added for unanticipated demand. Councilmember Capretta commented that the public should realize the water plant could be sold at some time in the • future rather than now, and it would probably be worth even more in the future. Councilmember Capretta explained that if • SPECIAL VILLAGE COUNCIL MEETING MINUTES February 24, 1998 PAGE 6 ------------------------------------------ Jupiter purchased the water plant today they would cancel the plans for the RO plant since they had built so far in advance of their needs that they have too much RO water, and if Seacoast purchased it they would keep the permits available so that they could build the RO plant someday because they now have no RO plants. Councilmember Capretta stressed that a decision must be made whether the water plant is for sale at this time, and if so, a counter offer should be made with 30 days to accept or reject. Councilmember Mackail pointed out that the same consultants had been used by Jupiter and by Seacoast. Tom Little, 486 Dover Road, questioned whether Seacoast had right-of-way to come through Jupiter to bring water to Tequesta. Mayor Schauer responded that the offer from Seacoast included an agreement that Jupiter would agree to • relocate Tequesta interconnect meters in a manner acceptable to Seacoast; that Jupiter would agree to isolate its customers from the Tequesta system in a manner acceptable to Seacoast; that the Jupiter residents currently served by Tequesta would thereafter be served by Jupiter; and that Jupiter would allow for the distribution of lines and appurtenances, bridge crossing, meters, etc. Mr. Little stated the Village had had a money-making Water Department since its inception and questioned how much money the Village had used from the Water Department for various projects over the years, to which Village Manager Bradford responded it had been millions of dollars. Mr. Little advised the village Council that there already existed a water line crossing onto Jupiter Island, which was a loop line in the old turtle grass area on the north end which provided the loop capability to go across to Jupiter Island, with no additional cost to the Village to service Hobe Sound Water Company, Hydrotek, and a small water company which was only providing chlorination, which was substandard water treatment. Mr. Little urged the Village Council not to sell their best profit-making department. Mr. Little requested that Mayor Schauer pass the gavel and make a • motion not to sell the Water Department, stressing that with changes in the Asian economy our interest rates could change • SPECIAL VILLAGE COUNCIL MEETING MINUTES February 24, 1998 PAGE 7 suddenly, and urging that the village obtain a lobbyist to use political clout. Dr. Stanley Jacobs, River Drive, reported that many residents felt the Village should retain control of the water Department. Dr. Jacobs commented that with only one seat on the Seacoast Board, Tequesta would have no control; that future village Councils could decide to spend some of the sale proceeds, thus reducing the amount needed to produce interest income; and if the decision was made to sell then a referendum should be held to allow the residents to express their view. Mayor Schauer passed the gavel to Councilmember Mackail. Mayor Schauer made a motion to not to sell the gPater • Department, and to proceed with the bonds and the RO plant. Councilmember Mackail seconded the motion. The vote on the motion was: Elizabeth A. Schauer - for Alexander ~. Cameron - against Joseph N. Capretta - for Ron T. Mackail - for The motion was therefore passed and adopted. Mayor Schauer requested that Village Manager Bradford write a letter to Seacoast thanking them and declining their offer, and telling them the Village is going to proceed with their bonds and the construction of a reverse osmosis plant. V. ANY OTHER MATTERS Councilmember Mackail commented that village employees were present at this meeting, and assured them the village Council was as concerned as they were and always acted in favor of what was best for the village, as well as for the employees' continued long-term employment with the Village. SPECIAL VILLAGE COUNCIL MEETING MINUTES February 24, 1998 PAGE 8 ------------------------------------------ Water System Manager Tom Hall pointed out that items (A) and (B) had not been discussed. Clark Bennett, Financial Advisor on the upcoming bond issue, reported that a commitment of insurance had been received at 30 basis points of total principal and interest as well as a commitment to issue a debt service reserve surety, which meant the Village would not have to fund a cash reserve of approximately ~ million dollars. This meant the bond issue could be reduced by that amount. The commitment was issued approximately one month ago, and was good for 90 days. Mr. Bennett reported this would reduce the amount of borrowing and debt service. Councilmember Capretta commented he had received several inquires as to how to purchase the bonds, which were available through Raymond James Company, and requested that information be included in the next Village newsletter. Village Manager Bradford commented that the next Village Council meeting was scheduled for March 5, which might be too soon for the Village to be ready to award the bond issue and make a bid award to the contractor subject to receipt of funds. If those two items could not be accomplished by the March 5 meeting, a special Village Council meeting would probably be held March 12 to approve those items. VI. ADJOURNMENT Councilmember Cameron moved that the meeting be adjourned. Councilmember Mackail seconded the motion. The vote on the motion was: Elizabeth A. Schauer - for Alexander W. Cameron - for Joseph N. Capretta - for Ron T. Mackail - for • The motion was therefore passed and adopted and the meeting was adjourned at 8:02 P.M. SPECIAL VILLAGE COUNCIL MEETING MINUTES February 24, 1998 PAGE 9 ------------------------------------------ Respectfully submitted, f ~7~cz-cam,' L ;`~~,~~ Betty Laur Recording Secretary ATTEST: ~~~u~~~ Joann Manganiel o Village Clerk L DATE APPROVED: C