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10-27-1975 - Special . -- '4 o '-I CITY COUNCIL OF THE CITY OF EDGEWATER, FLORIDA SPECIAL MEETING HELD OCTOBER 27, 1795 ~~~~~:lmD . I..' I'" 1 ~,' ',V..- ,~ ,:J .. .. t.j ,,1 .... '.' y.l '...:;jI ') I ..~ ~ ' "~-. '.. "':I'''.'~ .'," "';.," f, ~lt..... l' .~,., ~ -( , .1 j~" t':. f '.. ... ~ . ....i.~ ~:. ~ t~ :tn'!'~1 '. The special meeting of the City Council of the City of Edgewater was called to order by Mayor David C. Severance, Monday, October 27, 1975, at 7:30 P.M. ROLL CALL: Mayor David C. Severance Councilman Jacob Lodico Councilman William H. Cairnie Councilman Walter B. Sikes Councilman Calvin R. Dietz City Manager Dale Bryant City Attorney Joseph E. Weaver City Clerk Sue Blackwell Acting Chief Mc Call Present Present Present Present Present Present Present Present Present Mayor Severance stated that the purpose of this meeting is for discussing and acting upon the bids received for the new water plant and sewer plant expansion. OLD BUSINESS: Mayor Severance stated that there was a motion and second which carried that a Resolution would be drawn up for tonight together with Rick Fernandez's certification, in regard to withdrawing funds from the Renewal and Replacement Fund for the repair of the sewer line on Flagler Avenue. Mayor Severance opened the floor for discussion in regard to the bids for the water plant and sewer plant expansion: Councilman Cairnie asked what the status is now of the water and sewer fund. The City Clerk stated that there has been an increase in the revenue fund, the auditors are starting on the operation and maintenance account tomorrow. Presently we have more money in the water and sewer account than we have ever had~before, however there has been a loss in 0 and M, because we had addi- tional people working there that were not budgetted for. Councilman Cairnie stated that in other words our water and sewer account is showing a loss right now. The City Clerk stated that this is true in the 0 and M account. (Operation and maintenance.) Councilman Dietz asked if there is surplus on hand anywhere to cover that? City Clerk stated that we are required to keep $100,000 on hand at all times. Each year we buy a certificate of deposit that on maturity, matures to $100,000. In years past that interest, over and above what the new note costs has been transferred back into the revenue fund. She stated that we could not ever issued any bonds until we got on a sound business basis, so instead of trans- ferring that back, we kept it in the account and have been invest- ing it. Presently we have $16,200 above what we are required to have. There is $50,000 in the renewal and replacement account that is invested. Each time this matures, we keep the interest and are investing it. She stated that we have approximately $47,000 in the revenue fund, which at least half of is invested. Tape 1 Side A 5 min. o o She stated that money has been transferred to the Bond and Interest Sinking Fund, and buying certificates of deposit, which are also drawing interest. Mr. Bryant stated that we made a transfer from the Operation and Maintenance Fund to the Renewal and Replacement Fund of approximately $25,000. Councilman Cairnie stated that what concerns him is that our present rate structure still doesn't show a profit in the water and sewer. Councilman Dietz asked the City Clerk if the money had not been taken out of the Operation and Maintenance would we be all right there now? City Clerk stated that the money did not come out of the 0 & M account, it came out of the Revenue account, which was budgetted to be transferred into the R & R account at so much each month, and we went ahead and transferred the money in one lump sum. Councilman Cairnie asked Mr. Bryant how many water and sewer connections have been made so far this fiscal year? Mr. Bryant answered 17 sewer connections, and 72 water connections. 10 min. Councilman Cairnie asked how many of the present pumps that we have now are running 24 hours a day? 20 min. Tape 1 Side B Mr. Bryant stated that he asked the engineers that today, and he doesn't know if he has an answer. Mr. Fernandez stated that they have not had a chance to check thoroughly, however the pumps would be running on an average of 50% of the time, upon more demand, they are running about 70% of the time. There were several questions in regard to Florida Shores. Mr. Fernandez stated that the law reads that no more septic tank permits will be issued after January 1, 1977. He explained the law as it reads. Mayor Severance stated that the septic tank moritorium pertains to density in a certain area in Florida Shores. Mr. Fernandez stated that if you do not have a plan for water and sewer service then all of Florida Shores will be inelligible for septic tanks, irregardless of density. Mr. Katez asked Mr. Fernandez if we are talking about the quality or the quantity of the water? Mr. Fernandez stated that we are speaking of both. Mr. Katez asked if we would have enough water to supply all of the City of Edgewater, including Florida Shores, without the new water plant? Mr. Fernandez stated no, that we would not have the treatment facilities for this capacity of water. He stated that you really can not talk about quality without talking about quantity. Mr. Fernandez explained the dead ends, and how they effect the quality of the water. Mayor Severance explained that the City has been trying to close the dead end lines as often as they could, however there are quite a few of them and it can not be done in one day. -2- ~ o Mr. Armstrong spoke to the Council in regards to this new system, and questioned if we are going to spend a lot of money extending lines to Florida Shores or any other area in the City and it may never develope, and the people here now are going to bear the 10 min. burden of the expense. Councilman Dietz stated that since a meeting today with Dr. Kelly, it was brought up again that the County is very much interested in making Edgewater its base supplier of water to Southeast Volusia County. He stated that if we could sell 500,000 gallons of water a day, in a years time this would be $100,375. You would have impact fees, and connection.fees. This would put us on our own and we would not be obligated to New Smyrna Beach. Mr. Gross asked if we had a long.,dry spell, would ihis new plant provide us with more water than our present plant. Mr. Fernandez answered yes. 15 min. Mr. Gross stated that if Mr. Dietz could get this in writing, he feels that selling the water sounds like a real good idea. Councilman Dietz stated that a letter should be written by our engineers in regard to this selling of water. Mr. Bryant stated that what the County wants to know from our engineers is how much money it will take to run a sufficient amount to the existing problem areas, what the time perimeters are, the time construction could start, and how it could financially supported and how much of the front end money they will have to come up with, and what the connection fees will be. Councilman Dietz spoke on this again, stating that this will assure us of a guaranteed income, he stated that he feels we 20 min. would be foolish not to take this opportunity. He explained that this is not a sure thing yet, however whether we do this or not we need the new plant. Councilman Lodico stated that no one seems to understand that if we have to hook up to New Smyrna, our rates are going to be 25 min. much higher, and this is what will happen without a new plant. Tape 2 Side A Councilman Dietz stated that if we put this off for another few years, our costs are going to be higher than what the bids came in now. Mayor Severance explained that this plant is looking into the future, for example 18 years ago the City built a plant that was not needed, however now it is at its capacity. We are trying to put a plant in the City which will last us for at least twenty years. 5 min. Mrs. Murphy questioned if we are protected under the Flood Control laws. Mayor Severance stated that all the plans for the water plant have been approved by all theproper agencies for construction, and whatever those plans reflect in regards to height above sea level and so forth are in line with the requirements. Councilman Cairnie asked what it is going to cost us to run this water to this area, we have to run the lines. Councilman Dietz stated that the County is going to run the pipes, however, this will have to be negotiated. Rich Fernandez spoke to the Council about this, stating that 10 min. to do this correctly we will need a strong mandate from the residents in the area. o -~ . - u o Councilman Sikes stated that all of this information is good, however he stated that we should not think that we are getting a larger system just to take care of residents outside of the City of Edgewater, we need this system now while we can pay for it. He stated that even if we could ever get another bond loan, we will never be able to get it at a 5% rate. Mayor Severance read the County Plans of 1972, which stated that New Smyrna Beach will be handling the water and sewer 15 min. for the City of Edgewater. Councilman Sikes stated that one thing that~has not been brough up, is that the engineers' fees for all of the work they have done in regards to this project will be several thousand dollars, and if we do not go ahead with the work, then this money that we will pay them is lost. Mayor Severance stated that what this boils down to is that the City of Edgewater should continue to stand on its own two feet and not have to lean on New Smyrna Beach or any other area. Mrs. Webber stated that she is tired of hearing about if we don't do this we will have to lean on New Smyrna, she stated that Mr. Fernandez was asked if we have enough water to supply the people we have now in Edgewater? Rick Fernandez stated that we have sufficient water to maintain the service that we are presently getting. Mayor Severance stated that we should not get the issued confused, the real issue is expanding the system to meet the needs of residents within the City of Edgewater, before 25 min. we go outside the City limits. Councilman Dietz spoke again about selling the water to the County, and that it would be a profit to us. Tape 2 Side B Councilman Lodico stated that you can expand and expand, as long as you are making a profit it is good. Mrs. Webber stated that no one can guarantee us a profit. Mrs. Turner spoke to the Council giving her opinion of the new water plant and sewer system, stating that a bargain is not a bargain unless you can afford it. She stated that the old plant was suppose to last twenty years, not thirteen, and that no plant can last for forty years, however this is how long it will take the City to pay for this proposed plant. Mrs. Turner spoke that if we go outside of the City limits and hook up customers, then pretty soon we will not have enought water for ourselves again, and we will have to expand again. Mayor Severance stated that again, this is a future proposal, right now the matter on hand is what we need here in the City of Edgewater. There was a question about the engineering fees on this project. Rick Fernandez explained that their fee is 7.8% of the bid, which is set out on a schedule drawn up by FarmeFs Home Administration, and he explained how this is to be paid. -4- .~ o o Mr. Denton stated that he is a retired registered professional engineer in several states and the State of Florida. He stated that he did go to Mr. Fernandez' office and looked over the plans' and so on, and the only assurance that you are going to get is to have a reliable consulting engineering firm. Mrs. Turner asked if it isn't to their benefit to sell us a plant. Mr. Denton stated that this is correct, however no reliable firm, such as Briley, Wild, is going to sell you a lobo, they can not afford to, because this is how they get a reputation. Mr. Denton spoke further about ecology, and that we are unfor- tunate because we live so close to the Indian River and it is water quality limited, because of the fishing, swimming, and so forth, and we need to control the quality of our water. Mayor Severance asked Mr. Denton, as a retired engineer, if he thought the plans were adequate or inadequate. Mr. Denton stated that they are very adequate. He stated that his feelings were that perhaps you were paying too much for them,however after looking at the plans, they are very adequate. Tape 3 Side A Mrs. Turner asked Mr. Denton if he feels we should sell our water out of the City limits, or hold that off until in the future? Mr. Denton stated that this is just a business proposition, and if we find out that it is worthwhile and we make money this is something for the Council to decide. Councilman Cairnie asked what the bond attorney is going to charge us? Mayor Severance stated that he believes that the figure was $11,000. City Attorney Weaver stated that the $11,000 figure is for the bond attorney and your own City Attorney. 5 min. Councilman Sikes asked if is correct that we have 60 days from the time that the bids were opened, and when the bonds are issued there is a 30 day waiting period? City Attorney Weaver stated that this is correct. Councilman Sikes asked Rick Fernandez to read his recommendation. Rick Fernandez stated that the low bid for the water improvement program was $538,000 with a deduction of $10,000 if both contracts were awarded to American Consolidated. He stated that his recom- mendation was for the sewer plant to include the base bid of $440,000 with the deduction of $10,000 for the utilization of the prestress concrete outer wall and an additional deduction of $10,000 which they offer if both bids are awarded. It is his recommendation that the Council authorize the Mayor to sign the pre-application and the application to F.H.A. requesting addi- tional funds, and make a tentative award to American Consolidated pending the bond validation. Councilman Sikes made a motion that we authorize the Mayor to sign the forms necessary to secure an additional loan from the Farmers Home Administration as recommended by our engineering firm, being seconded by Councilman Lodico. Mrs. Webber asked if it is not true that this is being rammed down before they go out of office? Mayor Severance stated that if this is her opinion, she is -5-" .~ o o certainly entitled to it, however this has been discussed for three years and he feels that it is time that something is done. Mrs. Webber stated that the Council is disregarding the people's feelings, why isn't this put on a referendum? 10 min. Councilman Dietz called for the roll call. Upon roll call vote said motion CARRIED. Councilman Cairnie voting NO. Councilman Lodico made a motion to direct the attorney to re- draft the bond ordinance to $900,00 from the $700,000, being seconded by Councilman Sikes. Upon roll call vote said motion CARRIED. Councilman Cairnie voting NO. Councilman Sikes made a motion that we award to American Con- solidated for the construction and expansion of the water and sewer plant as recommended by our engineering firm, tentative to the bond validation, being seconded by Councilman Dietz. Upon roll call vote said motion CARRIED. Councilman Cairnie voting NO. Councilman Dietz stated that he would like to get the feeling of the Council on this selling the water to the County because they are going to have a workshop session next week, and they want a letter from us stating that we are in the position to do this. He stated that the County at present doesnot have the money to do this, they have to borrow the money. We have $110,000 in Federal Revenue which is invested in banks now and according to the auditors we could loan that money to the Council at the same interest rate for the use of this until July 1976. Mayor Severance stated that this would be good business, however he doesn't feel that we should go out on a limb and give the County money that they don't have now, and what is to guarantee 15 min. us that they are going to pay us back? City Attorney Weaver stated that he would like to talk to Rick Fernandez about this further, and he would like to talk to Cliff Cunningham also. Mayor Severance stated that moving this money around requires certain paperwork. Mr. Bryant stated that what Mr. Dietz is trying to say is if the auditors can find a way in which this money can be used as front end money without jeopardizing the initial program that you have approved, would you like Mr. Dietz and whatever assistance he needs from the engineers, the attorney, or Mr. Bryant, to pursue the matter? Councilman Dietz stated that again, time is an element. 20 min. The Council members discussed this further with Councilman Dietz. Councilman Sikes stated that he feels that we should not put any money anywhere else outside of our own project, until we get bond validation. Mayor Severance stated that he agrees with Mr. Sikes. Councilman Lodico asked if we should call a special meeting to handle the Resolution that we instructed Mr.Weaver to draft? The City Clerk stated that she does not know whether a special meeting notice is necessary, however she will research and see, and if it is necessary she will let the Council know. -6- , - . . . ~ u There was more discussion in regards to this. Councilman Lodico made a motion that we call a special meeting Thursday, October 30, 1975, to discuss the Resolution redrafting the bond ordinance to $900,000, being seconded by Councilman Sikes. Upon roll call vote said motion CARRIED. Tape 3 side B Mayor Severance stated that we still have not answered Councilman Dietz's question. Councilman Lodico made a motion that a discussion of supplying water to the Southeast portion of Volusia County, namely Indian Harbor Estates, being seconded by Councilman Dietz. Upon roll call vote said motion CARRIED. NEW BUSINESS: None MISCELLANEOUS: Mayor Severance stated that we need to discuss the City Attorney going with the City Clerk to the State's Attorney's office. City Attorney Weaver stated that he will attend the meeting with the City Clerk. Mayor Severance asked Mr. Weaver if Mr. Tindel said what the subject matter was? City Attorney Weaver stated that the subject matter is a violation of the Sunshine Law. Councilman Dietz made a motion that the City Attorney attend the meeting with the City Clerk, being seconded by Councilman Lodico. Said motion CARRIED, upon roll call vote. ADJOUNMENT: Councilman Sikes made a motion to adjourn, being seconded by Councilman Dietz. Upon roll call vote said motion CARRIED. MINUTES TAKEN BY: Sue Blackwell ~~ City Clerk ztv Approved this .5 day of ----- ~ ~J..., v' I~' / !IC-' .~ ~~ -7-