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03-14-1990 - Workshop/Special ... '-" 'wi CITY COUNCIL OF EDGEWATER WORKSHOP/SPECIAL MEETING MARCH 14, 1990 MINUTES Mayor David Mitchum called the meeting to order at 7:00 p.m. in the Community Center on the capital improvement program, water and sewer. ROLL CALL Mayor David Mitchum Councilman Dan Hatfield Councilmember Gigi Bennington Councilman Russell Gold Councilman Thomas Fish City Attorney Josel Alvarez City Manager Elly Johnson City Clerk Susan Wadsworth Chief Lawrence Schumaker Present Present Present Present Present Present Present Present Present Mayor Mitchum stated this is a special meeting and they'll handle the business and then go into the workshop. He read the items to be reviewed: CIP Program status on water system; water distribution improvements - u.S. 1 north of Park Avenue; wastewater treatment plant; stormwater master plan; Florida Shores infra- structure improvements with general overview and wastewater collection; preliminary finance plan by financial advisor; State Revolving Fund status; closing statement; and questions and answers. Mr. Ron Ferland, Project Manager, Dyer, Riddle, Mills & Precourt, Inc., showed transparencies of what had been accomplished, such as studying the problems to identify infrastructure needs, assessment of financial market capabilities and listing of projects. He noted they have a preliminary estimate of the f i nanc i a 1 impact with costs to each res i dent and the projects were prioritized. He added funding will be discussed and then construction of improvements. He stated the question of how to sewer Florida Shores, whether low pressure or gravity and both have technical merit and ability to do the job and one has a much lower construction cost than the other and one has higher operation and maintenance costs. He pointed out they can design either system. He recommended in order for the program to move ahead smoothly to have all the issues on the table and resolve them in a democratic manner to proceed post haste with a referendum to certify and select the type of sewer system the community desires to be in Florida Shores. He suggested they proceed quickly if they decide on this because every day they wait jeopardizes their ability to access the low interest money from the State Revolving Loan Program and the low loan interest is of extreme interest to this program. Mayor Mitchum stated he wouldn't have a problem with referendum since the way the survey cards were done was not popular. Mayor Mitchum recommended Council take into consideration the recommendation and make a decision once and for all to put it to rest to know where they1re going and once the referendum is done, it's done. Councilman Fish concurred with Dyer, Riddle, Mills & Precourt's recommendation and moved they put the question to the people in the form of a referendum as soon as possible. Councilman Gold seconded the motion. Councilman Hatfield questioned if they can do it in a timely manner so there's no possibility of losing the low interest rate. Mr. Stan LivenQood, Vice President of Raymond James & Associates, said the value of the low interest to the rate payers of the City water and sewer system of 14 million or 15 million at 3% below market rate is in excess of 10 million in savings and it will have a negative impact on rates and assessment costs if they're not able to use those committed funds at the State leveL He stated he I d talked with DER in Tallahassee today and advised them of the situation and he1s convinced the referendum will not mean they'll necessarily lose those commitments but it will place a major time constraint on them because the loan must be signed by the end of the State fiscal year or will be lost. He added they must wait for the referendum for many of the things that must be done and loan agreements cannot be executed until they have plan specifications and design and almost to the contract stage and putting 6 to 8 or 8 to 20 weeks time frame jeopardizes and increases the difficulties but he feels they can accommodate the referendum if it's speedily carried out. Councilman Hatfield asked the earliest date they can have it on the ballot for the people. City Attorney Alvarez explained Chapter 100 of the Election Laws regulates the procedures for referendum with a resolution and advertising requirements and the last time was 45 to 60 days. 'w' ...., Councilmember Bennington asked what the question will be if they go to refer- endum and what the wording would be as she wants to know the issue before they vote. Mayor Mitchum said itls between low pressure or gravity. Councilman Hatfield asked about the third system Mr. Ferland had mentioned. Mr. Ferland explained that's a combination of both to get a technical compromise but the cost difference isn't great enough, and their recommendation is still the low pressure system because it's the alternative with least cost and most cost effective. He pointed out the SRF requirement in the 201 Plan Council accepted by resolution has in it the lowest cost effective alternative of low pressure and that's what they're funded for. He added if they go with the higher priced system, they may have to pay the incremental cost between cost effective and higher priced system. Mr. Gerry Hartman, Vice President, Dyer, Riddle, Mills & Precourt, Inc., stated if they want to pay more for the gravity system, that's fine, but they did what they were supposed to do as engineers and evaluated the alternatives and came up with two and are recommending the least cost and most environmentally sound. He added they're recommending a referendum with a simple one, two vote. He said they have a good water plant design, excellent wellfield program and CUP, good wastewater treatment plant and program and there's only one component for a vote. Councilman Hatfield stated held like to wait to vote until they have the facts before them and have heard from the financial team and engineers on both projects. Councilmember Bennington stated the referendum will be a City wide referendum and every registered voter will vote. Motion to put the question to the people in the form of a referendum as soon as possible CARRIED 4-1. Councilman Hatfield voted NO. Mayor Mitchum stated they have to get going because of the State Revolving Funds. Councilman Fish agreed it has to be as soon as humanly possible and they don't want to waste time and lose State money because that low interest money is very important. Mayor Mitchum suggested they try to get with the County sales tax ballot and asked Council to instruct the City Clerk and City Attorney to try to get in with them. City Attorney Alvarez pointed out they need wording on the question. He asked if cost will be part of the question to show the difference between the two systems. Mayor Mitchum suggested they go into the Workshop at this time and then go back into Special Meeting. Mr. Hartman stated they secured land for the new water treatment plant and got the consumptive use permit for that plant and designed it and are now at permitting and construction. He added they have a system analysis to have adequate fire service throughout the City and deficiencies are part of the program and corrections will be made. He pointed out the Public Works projects are very important to alleviate deficiencies of flooding. He said they identified the infrastructure needs and gave a comprehensive list of the projects that we prioritized based on need. He said they went through the first two steps in the assessment of the financial market capabilities and financial impacts and the program decision was made. He noted the options are still available for a low pressure system and everything is on schedule but there are certain deadlines for decisions to be made. Mr. Hartman showed on a slide the low pressure versus gravity systems with costs and technical assistance of the systems, such as being reliable or good enough to be recommended to the City. He stated they designed a very good system but the gravity system has a higher index overall but there's marginal cost between the two and the key point on a curve is an acceptable system. He added they'll decide to pay more money for a little more reliability or more special features. Mr. Hartman stated they looked at the cost for capital and also present worth and from the capital standpoint there's a large difference but from present worth standpoint the difference is not that great. Mr. Ferland stated they have site zoning for the water plant and wellfield and received County DRC approval and are in the permitting stages with DER and St. Johns River for the stormwater system and Florida DOT for the driveway permit off 442 and all railroad crossing permits are on hand. He said the stormwater master plan final report will be provided to Council at the end of March with the presentation to be at the second Council Workshop/ 2 Special Meeting Minutes March 14, 1990 '-' ..., meeting in April to allow ample time to read the report and fully understand it. He stated they met with St. Johns River regarding conceptual permitting to get their concurrence with the master plan so they can get one permit to cover the entire program and it was favorably received. He said the water distribution system improvements were precipitated between the hydrant analysis a year ago plus fire protection north of Park Avenue. He said they worked on ways to provide fire protection on both sides of U.S. 1 and will be providing those soon. He stated the wastewater treatment plant is at final design and will be submitted for DER and DNR permits and to Tallahassee for the SRF program. He added we have to provide them with our plans to be sure welre in compliance with their requirements and they hope to have it as a biddable project in the June- July time frame. Mr. Ferland stated the Florida Shores infrastructure improvements are 90% complete on the aerial surveys and the final 10% will be in the next week or two. He said they're completing project design and construction on a phase basis in order to finance it in accordance with the SRF program. He pointed out they're recommending the low pressure system in Florida Shores and they have guest speakers, Mr. Schmidt, Sr., who invented this system and called it the STEP system, and Mr. Paul Pour of Sebring, who served on numerous State and Federal level committees regarding this system. He introduced Mr. Harold Schmidt, President of General Development Utilities. Mr. Schmidt reviewed the history of the low pressure system since its inception in 1954. He noted they installed the first unit in Port Charlotte in August, 1970, and obtained a permit from the Florida State Health Department, who was responsible for sewer systems. He said they built a small treatment plant to treat the effluent and operated it for over 10 years and then tied it into the gravity sewer system. He noted in 1974 a project was installed in Idaho financed by Farmers Home Administration and it served 500 homes surrounding a series of large lakes, and they installed one in Alaska. He pointed out they had to write specifications and design to meet State requirements and formed a committee with people from the Health Department, EPA, Tallahassee DER and others. He stated the systems do work in areas such as with high water tables and with rock and he also had reservations 20 years ago but the low pressure system will continue to be used and will continue to be expanded. Mr. Ferland then introduced Mr.Paul Pour, associated with Alpha Septic. Mr. Pour stated he's not recommending a system that will fail or cause problems. He added they're involved in 10 systems in the State and are working with a number of municipalities and four other projects in this area are considering low pressure. He said they're considering retrofitting 80,000 units in Jacksonville are completing a design for Cape Coral where gravity would be 39 million and low pressure would be about 6 million. He stated there were a lot of problems that are with any new system but they've worked the bugs out and the system works and there are problems from time to time and they can handle them easily at low cost. He pointed out Federal funding has been removed from almost all gravity sewers and municipalities are looking for economical and ecological systems. He said they're rewriting a new Federal standard for low pressure. He stated the serious problems with Port St. Lucie they1ve heard about aren't true and there were three instances with conflict going between the City of St. Lucie and General Development and St. Lucie is buying out the utility system and it's a forced buy out with disapproval of the residents, not with the system but with the costs as they feel they're being overcharged. He said there were back up problems in one area but the utility company knew what was going on and they needed a lift station in that area and it's working now. He said the third problem was they were using a pump that had a design problem and they needed to change to a different type of pump and eliminated that problem. Mr. Hartman stated he's familiar with the acquisition of the utilities and they have to go through a process. He added they don1t have inflow infiltration with low pressure and the gravity system does. Mr. Ferland stated gravity had 20 lift stations in the 201 Plan with no more than 16 feet cut, low pressure lines are 3 feet deep and they don1t have to worry about natural divides, such as drainage ditches, and will have 7 lift stations. Mr. Ferland showed on a map locations of the lift stations that are service areas and phases of construction with low pressure or gravity. He said they could have four different contracts for construction to fund the one in 1989-90 and then access the SRF program without having to take bridge financing and to maximize contractor competition. He added they'd want construction to span SRF, 3 Council Workshop/ Special Meeting Minutes March 14, 1990 '-' ,.., which is a 2-1/2 year fiscal period. He showed where it would hook up with a gravity line to the middle of the street. He explained the gravity line in the middle of the street is because of drainage along both sides and they don't put sewers inside drainage swales, and if it were along one side of the road, then they'd have to go under the street to hook up the system to the house on the other side. He showed a conceptual retrofit with a septic tank easily accessible and available with inserting of the pumping chamber into the existing tank and disconnecting the drain field and running the line from the pumping chamber to the street. He showed an interceptor tank with a pumping chamber and at what point the homeowner would be responsible. He noted a new system would have a clean out. He showed where the control panel would be at the outside of the house with an audible alarm, which is a buzzer, and a visual red light that doesn't go off until the problem is corrected. He added that each pumping system would have a check valve, and the pumping chambers have holes covered with large mesh screen and a Myers pump on the suction end has a fine nylon screen to prevent large material from getting into the pump and causing a problem. Mr. Ferland reviewed the figures for gravity for a total of $17.3 million. He stated they're required by the 201 Plan to show the most cost effective solution and the SRF is a Federally funded program and total for low pressure is $13.6 million. He pointed out low pressure is an acceptable solution to DER and Federal EPA, and they may put in gravity but may be responsible to fund outside the SRF for the difference. He added that when the referendum is resolved, they can go to the state to try to convince them the public accepts this and they should accept for funding a higher priced system. Mr. Ferland read through the criteria for the sewer advantages/disadvantages and referred to the sewer system failures with sand on Riverside Drive. Mr. Stan Livenaood, Raymond James & Associates, stated they have a financing plan of three components, 2 are SRF administered by DER and federally subsidized. He said there would be a 1990 loan of $7,396,000 at an interest rate of 4-1/4% which is 3% below current rate, and a second in 1991 of $6,868,000 at 4-1/4% and a $12,250,000 water and sewer referendum bond issue to refund the new money for water system improvements and some of the sewer system improvements would be funded. He said all the rate payers City wide for water and sewer to finance the portion of the CIP that would be funded from rates would result in an average water and sewer bill increase in 1990 to $27.05 and to $35.83 in 1993, which are estimates. He noted the 1993 rates are in the high median range of what neighbors in Volusia and Brevard Counties are paying now. He said Florida Shores residents would be connected on a timely basis and would contribute as rate payers and users. He said the other component applies only to Florida Shores and is the sewer system being funded by special assessments levied within Florida Shores. He noted two levels of assessments would be used, one for existing already developed lots and one smaller assessment for undeveloped lots. He stated if the low pressure was selected by referendum, the annual assessment would be $215 for developed lot or $18 a month and unimproved lots would be $120 a year or $10 a month, and if gravity is selected, the annual assessment for developed lots would be $385 or $32 a month and for undeveloped would be $325 or $27 a month. Mr. Hartman showed on a slide the costs that Mr. Livengood had reviewed, noting the most cost effective is the low pressure system but if they want something more expensive, this is the prudent time to consider it and they're recommending they do consider it. Mayor Mitchum requested audience comments. Rav Miller, 3110 Sabal Palm, asked if they'll pave the streets on the low cost system. Mayor Mitchum replied that wasn't discussed. Mr. Miller stated with gravity they have to reconstruct it and that price would be paving of all roads. Mayor Mitchum stated paving isn't in that cost. Mr. Hartman explained cost isn't there for paving and in the CIP they had 10 million for paving all streets. Mr. Ferland stated approximately 50 miles would be paved at $25 a lineal foot. Mr. Miller asked if streets would be paved either way. Mayor Mitchum replied any work under gravity is reconstruction of streets that would be torn up during construction. Mr. Miller asked if they can put a manhole down a dirt street. Mr. Hartman replied yes, but it's not that good. Mr. Miller asked if they stopped selling building permits. Mayor Mitchum replied no. Mr. Miller stated the entire city will vote and people who have systems don't want it and Florida Shores is stuck with it and the people in Florida Shores should vote and forget the rest of the city. He asked why there haven't been more cities with low 4 Council Workshop/ Special Meeting Minutes March 14, 1990 '-' ..", pressure. He said if they're not going to pave the roads, he doesn't see how they' 11 put the manho 1 es in. Mr. Hartman aga i n exp 1 a i ned the pav i ng is a separate component of the CIP. Norm Billups, 1860 Pine Tree, showed the audience his idea of the low pressure system. He asked if there's enough insurance for the City to cover all the property that will be flooded and cleaning that will be necessary. Georqe Ewinq, 2923 Royal Palm, questioned the difference in figures since those given with the 201 Plan of May, 1989, and the green sheet of November, 1989, and the report from Dyer, Riddle of December, 1989. He said the monthly assessment in 1993 shows low pressure at $17.93 and gravity at $31.87 but with 13 million for low pressure and gravity at almost 32 million, the payment ratio has to be incorrect. He asked that they get accurate figures. Mr. Hartman explained he'd looked at total present worth cost and capital cost is the difference and capital costs are assessed. Mr. Rob Ori, Dyer, Riddle, Mills & Precourt, stated the funding alternatives for low pressure of 4% and gravity is 7-1/4%. Mr. Ewing suggested they get across on the gravity system that each household would make their individual connection and that would reduce the financing cost and they wouldn't make payment until 1993 and people would probably be willing to put their own lateral lines in at their own cost. He suggested they get accurate costs as these aren't contract prices. Mr. Hartman pointed out they serve 33 cities in several counties and have complete cost records of people involved in this type of work and these numbers are derived from the estimates. Mike Havs, 2319 Umbrella Tree, stated the engineers agree the quality system is the gravity system. He also stated that under the equal protection law of the state, the City cannot discriminate between groups of persons under the 14th amendment. He asked for a City-wide referendum with general obligation bonds with a simple yes or no. He asked how they'd deal with the issue of access on private property without consent and hooking up electricity without consent. Mayor Mitchum pointed out the issue might be moot, depending on the referendum. Mr. Hayes asked the value of the sewer investment in 10 or 20 years for low pressure versus gravity. Mr. Hartman replied gravity has a higher value later on in the time period of 10 years and higher capital cost and functional value is higher value for low pressure because gravity has up to 25% more impact on the system than low pressure. Mr. Hays asked the number of low pressure and gravity systems they had designed and installed and where they're located. Mr. Hartman replied their firm has not designed and installed any low pressure but have designed about 3,000 gravity. Mr. Hays asked what they'll do with solids when septic tanks are pumped. Mr. Hartman said solids do come through and those that don't break down there's a miner flow into the overall sewerage system and gravity is 25% greater than the impact of low pressure. Jan Hobbs, 1325 Travelers Palm, asked if it would cause a problem with solar water systems when the electric goes off. Mr. Hartman replied no. Ms. Hobbs asked who would clean up if there's a back up. Mr. Hartman replied operation and maintenance of the system is the City's responsibility. Ms. Hobbs asked the difference between their responsibility and the City's in case of clogs. She then asked if the rate increase for water and sewer would be from $27 to $33. Mr. Hartman replied the septic tank structure is her responsibility if it's broken up. Mr. Ferland pointed out it's approximately $1,500 for the new system and to retrofit is $1,000. Mr. Hartman explained it's an additional $500 if the septic tank is broken down and failed. Mr. Ferland stated if you built a patio over it or paved the driveway over it, it's not acceptable, and you can't retro- fit the tanks and would have to put in a new one. Ms. Hobbs asked how they'd pay for it. Mr. Hartman replied financing over a long period of time. Ms. Hobbs asked if it would be a separate bill. Mr. Hartman replied yes, they'll have the sewer monthly rate and the assessment rate, and they'll have two components, the rates of $27 to $30 for monthly user rate for 5,000 average with water combined and with low pressure would be an additional assessment charge of $18 per month or for gravity would be $32 a month financed with a low interest rate. Ms. Hobbs asked if the pipe from the home to the tank would be her responsi- bility. Mr. Hartman showed on a slide where the stub out would be with a clean out valve. He stated that Ron Ferland was administrator of a Gainesville Util ity. Ms. Hobbs asked if she were on vacation and nobody used it, could anything happen. Mr. Hartman replied no. 5 Council Workshop/ Special Meeting Minutes March 14, 1990 .'W' ...., Art Lloyd, Victory Palm, stated the system Mr. Schmidt referred to for General Development has been condemned as of the March 2nd Stuart News. Mr. Hartman explained there was a problem with the lift station on the line discharging hydraulically and they didn't have enough hydraulic capacity and it wasn't the problem of the low pressure. He pointed out condemnation is a method of acquisition and it was not condemned for the health and welfare. He added he's been involved in 40 acquisitions throughout the State. He said the city has a franchise with GDU for two more years and they want ownership of the system and condemned it. Mr. Lloyd asked why they'd take such drastic action because the article said it was an ongoing thing with GOU and there's an investigation going on. Mr. Hartman rep 1 i ed one is about 1 and sa 1 e pract ices and it I s tota 11 y separate from the utility and General Development Utilities and General Development Corporation are often confused and the indictments are relative to the land development and not the uti 1 ities. Mr. Lloyd asked the referendum question be put in layman's language where a yes vote means yes and no means no. James KeoQh, 2632 Queen Palm, asked if the gravity system over a long period of time had a cost not as high as if you float a bond. He asked they be given details and a yes and no. He said they have gravity in Florida Shores and they shouldn't deny the rest of the City and spend the money and spread it out for 20 to 30 years with a bond. He said everyone in Edgewater should pay for this and spread it out for the gravity system. Jimmie Newell, 2450 S. Ridgewood, asked the number of people in Florida Shores not registered to vote for the referendum. Mayor Mitchum said that's the only fair way he sees to do it. Mr. Newell stated they're being as fair as with the mail out and they're going to make people pay for it who are not registered. Mayor Mitchum pointed out they'll have time to get registered. Henry Oardinski, 2704 Sabal Palm, stated the clean out should be into the house and not to the septic tank. He said they paid $822,000 to date and came up with beautiful graphs. He asked why this engineering firm is pushing this type of sewer system as they've never designed a system before. He added if it's a failure, then they pay twice. Mr. Hartman stated there are no motives and they were charged with developing the most cost effective and sound system and make a recommendation, and he recommended Council that if there's a preference to pay the additional cost, then so be it and they're willing and ready to do it. Mr. Oardinski asked why they brought in people from the one system and little was said about gravity. Mr. Hartman explained he thought people knew what the gravity system is and they were concerned the people didn't understand the low pressure and they want to educate them and show them the costs. Mr. Dardinski asked about the 25% inflow infiltration lower on gravity and they'll get in on the systems that are broken down and this will be a new and tight system and infiltration should be minimal. He said they wouldn't have to clean out their tanks and will have the extra cost of getting the sludge out of existing tanks. Mr. Hartman said the City maintains that and it's part of the 0 & M cost and why it's twice as high. Mr. Oardinski asked about the extra employees and uniforms and trucks. Mr. Hartman replied they have a detailed list and will send it to him. Mr. Oardinski said it's a project cost analysis and they don't know exact costs. He asked the size of the pipe. Mr. Ferland replied it goes from 211 to 811. Mr. Oardinski asked what would go up Sabal. Mr. Ferland replied it's different sizes because as you get closer to the lift station it's larger and will be 811. Mr. Oardinski asked if they'd considered 6 to 8 a.m. and 5 to 7 p.m. when there's a big demand. Mr. Hartman replied yes. Harrv Jones, 3034 Tamarind, stated the engineers did a wonderful job of brain- washing. He said Port St. Lucie is considering removing that system and putting in gravity flow and the units they're having trouble with are those in 5 to 6 years. He asked how it wou 1 d be in 10 years here when they have to put in gravity flow as they'll be stuck with 10 years of payments and have to put in another system. He stated held talked with an expert, Mr. Haydock, and he said there are too many gadgets and there will be about 3,000 pumping stations and that is 3,000 chances of going bad. He said the figures in August have gone up and they still don't have definite figures. He stated on August 3rd Councilman Gold made a motion to have a referendum vote, seconded by Councilman Hatfield, and they're still waiting for an answer. He said this is millions of dollars and many people cannot juggle it with their budgets to the last penny. He pointed out the people who vote for low pressure will be gambling that it will last until itls paid for and if it doesn't, they're voting for two systems because they'll have to finish paying for this one and then pay for a new one. Council Workshop/ Special Meeting Minutes March 14, 1990 6 -.r ....,. Dick Hitchcock, 3313 Woodland, stated Port Charlotte had one of the first systems and had problems and went to gravity. Mr. Schmidt stated the treatment plant was phased out and the discharge from it went into the existing gravity system but the pressure system is still operating but the STEP was disbanded because it was small. Mr. Hartman explained the low pressure system is still in and he's talking about the treatment plant which was phased out to the regional system. Mr. Hitchcock asked about problems in the Ruskin area. Mr. Hartman replied they have a lot of contract problems. There was discussion about the problems with installation at every fourth dwelling. Mr. Hartman pointed out this is a different design and is individual. Mr. Hitchcock expressed concern with the condition of existing tanks. Mr. Ferland stated they1d researched this and because of the age of Florida Shores, they feel 85% can be retrofitted, which was what happened in Ruskin. Mr. Hitchcock asked if they anticipate a similar situation. Mr. Ferland replied no. Mr. Hitchcock expressed concern with the Ruskin problems and this being Dyer, Riddle's first endeavor. Dave Molnar, 2117 Travelers Palm, said a man came with a rod and was going to puncture his lawn and he has a sprinkler system with an electrical system and he got a nasty and rude response from the workers. He stated the system will violate their privacy and with the crime rate in Florida Shores they shouldn't let anyone on their property. He said it's $17.13 for low pressure and $31.87 for gravity and the monthly difference is only $13.94 for gravity. Mr. Hartman agreed that's correct. Billy Klein, 2910 Needle Palm, stated in February, 1987, the expansion of the wastewater plant was estimated by Dyer, Riddle at 3.3 million and now it's more than double. He said the paving was estimated at 14 million and is now down to 10 million, and the December, 1989, memo had low pressure at a little over 7 million and now it's estimated at 17 million. Mr. Ferland explained the 7.8 million was developed by Rob Ori and it was the CIP finance preliminary document and held assumed over 4,000 retrofits in 1992 and the $1,100 each brought the difference to 7.8. He said for the 1987 cost for the treatment plant all they were doing was expanding the plant with a secondary treatment mode with filter and no nutrient removal before discharge but new legislation has required it be upgraded level of treatment from secondary to advanced to have BOD and other removals prior to discharge to the Indian River. Mr. Klein stated they've estimated 3,062 retrofits, but what would it be with entire build out. Mr. Ferland replied it wouldn't all be retrofit, they.d only be existing units at the time of construction. Mr. Klein said they were told there were 3,600 connections in water. Mr. Ferland pointed out some are already on the system. Mr. Klein asked if replacement of pumps is included in 0 & M. Mr. Ferland replied yes. Mr. Klein asked how many additional people the City will have to hire. Mr. Ferland replied they estimated 3 people. Mr. Klein stated Florida Shores has paid taxes and most of the assessment fees are coming from them and they pay three-fourths of the taxes and 85% of the water assessments. He stated the utility taxes were used by Councils from 1963 to 1988 and then they quit using the utility tax to supplement the sewer system. He said they're going to referendum but he thinks they should ask to go with general obligation bonds. Joyce Chapman, 2514 Evergreen, asked if this is the first low pressure system their firm has designed and they.ve had 3,000 gravity systems. Mr. Hartman replied yes. Ms. Chapman said she's waited 9 years for sewer and paving and the material that went out by post card was very distorted from what they're hearing tonight. She said she appreciates the referendum vote and asked that the people be made aware of the changes. Mayor Mitchum called a brief recess at 10:07 p.m. He called the meeting back to order at 10:16 p.m. Dominick Fazzone, 302 Paradise Lane, Shangri-La Village, stated he has the gravity system with no problems and feels they should have one system in the City and it should be gravity. He added it will cost more money but they will get what's best in the long run, and rather than 3,000 possible problems, they'll have one technical problem. He stated he's attended over 90% of the CIP meetings and Council meetings and has never head anyone suggest they're going to low pressure for any reason except it was cheaper, but not that it was better. He suggested with the May 1st Volusia County referendum on sales tax perhaps we could use the money that comes in for this CIP, specifically for this gravity system, as they would have got over $650,000. He added that money doesn't come from the people of Edgewater but the entire County donates into it and 25-30% Council Workshop/ Special Meeting Minutes March 14, 1990 7 --- ..., of the entire funds comes from visitors. He asked Council, the City Manager, and Finance Director to look into some of that money to alleviate some of the problems in Florida Shores. He added the County says it has to be used for a specific purpose but they're talking about improvements of public facilities with a life expectancy of 5 years or more and any land purchase acquisition. Norm Billups asked if the inlet of a pump refit would have a fine screen on it. He asked how the screen wouldn't impede progress of large pieces of organic matter as he was told when organic matter hits the screen, it would break up. Wendv Calderwood, 2405 Needle Palm, asked if the power goes out 4 or 5 days, will those pumps be equipped for the surge of power when it comes back on. Mr. Hartman replied yes. Mayor Mitchum stated they're now in the Special Meeting. He asked for wording for the question on the referendum. Councilman Hatfield pointed out he voted no because he wanted the wording before he voted. City Attorney Alvarez stated one proposed question was: Should general obligation bonds be issued for CIP, and that's a financing question and doesn't address the choice between low pressure and gravity. He suggested Counci 1 think of the issues and one is the choice between low pressure and gravity and the second is whether it be a referendum on geographically the Shores only or City-wide and if it's going to be a general obligation bond issue they need to establish an amount and then they cannot limit it to the Shores because G.O will be a City- wide tax. Councilmember Bennington asked how they'd limit it to Florida Shores. City Attorney Alvarez replied they can use inductive reasoning and when they talk about the choice between low pressure and gravity, which geography are they talking about. Mr. Ferland said it's Florida Shores only. Councilman Hatfield asked about his area. Mr. Ferland replied it could be low pressure now, and he's used low pressure systems but they didn't design one. Councilmember Bennington asked if the part of Florida Shores that has sewers will be allowed to vote. City Attorney Alvarez said the second question is the collection system, whether it be gravity or low pressure, depending on their choice, who will pay for it and how will it be paid. Mr. Ferland stated the financing plans have been based on special assessment programs where those benefitting pay for the benefits involved, the Florida Shores unsewered residents and unsewered vacant Florida Shores parcels, which includes Cherokee Ridge. City Attorney Alvarez stated if they're talking about the Shores with the choice between the collection system and special assessments to pay for those, he doesn't see a legal impediment to limiting that referendum to the Shores. He said from the point of view of the supervisor of elections, if you can identify from the list of voters those that are presently sewered, he doesn't know how you could keep them from voting, but perhaps they could do it by addresses. He said the Shores will pay for it through a special assessment, and if they decide to go to G.O. bonds, they have to go City-wide, and all the rules apply to the referendum. He said they're required to go under Chapter 100, but a referendum in the Shores is only one type of sewer and then 101.161 applies, and there may be one or two questions. Mr. Dan Livermore, Livermore, Klein & Lott, stated G.O. bonds are payable on ad valorem taxes levied within the area, generally City-wide, and all taxable properties in the City are taxed to pay the bonds and for a referendum you have to have all qualified electors vote on those bonds. He said if improvements are only located in a particular area, they can still levy City-wide taxes for facilities that will give greater benefit to one area than another, such as with a Library. He said if you want to pledge ad valorem, you can do that, and you can continue to plan to levy special assessments and plan for the rate increases so the combination would pay for the bond financing cost and for having a refer- endum vote for a back up commitment so the holders of the bonds would know that special assessments are not the pledges or if the water and sewer rates are not sufficient to pay it. He said the bonds would be for water and sewer rates and impact fees and it doesn't require a vote. He said the choice of the types of public improvements is a different kind of question. Councilman Fish asked if they issue bonds based on special assessment, what happens with the special assessment with the sale of the property, does it go with the property or the new property owner or does the seller pay it. Mr. Livermore replied they can provide for that either way and sometimes it provides for a period of time regardless of transfer of ownership, and sometimes the seller discharges it from the sale proceeds just as he would with his mortgage. Council Workshop/ Special Meeting Minutes March 14, 1990 8 ~ ...." Mr. Livermore added the bond financing usually provides for pre- payment. Councilman Hatfield asked if the state revolving funds would have the same prepay rules. Mr. Livermore replied they may be able to negotiate that and normally with public financing the bond holders want to be sure they're paid. He pointed out that with the low interest rate of SRF, perhaps they'd want to pay something else down instead of this. Councilman Hatfield asked if have to go to referendum to provide for a pre-payment plan. Mr. Livermore replied no, it would not be required but it's the City's choice and they'll accept special assessment or water and sewer revenue pledge. Councilmember Bennington asked if weld lose money if they prepay the assessment and if it would be better to have it on monthly installments for general revenue. Mr. Livermore replied they'd lose money if they prepay and once they get the money, they can reinvest it. Counci lmember Bennington pointed out a lot of people would pay rather than have the monthly bill they have to think about. Councilman Gold asked if they can word it, what type of sewer system is preferred, as a simple question. City Attorney Alvarez replied they could. Councilman Fish asked it be kept as simple as possible. City Attorney Alvarez agreed it1s a simple issue, but would they ask it of Florida Shores only or City- wide. Councilman Gold replied Florida Shores only. City Attorney Alvarez asked if Florida Shores should have the price tag of both to compare them. Councilman Gold stated it would be published in the newspapers. Councilman Hatfield stated all they could give them are estimates and it might be construed as inaccurate and they should have a simple question. Councilman Fish moved they instruct the question to read, which system is desired, gravity or low pressure system? Councilman Gold seconded the motion. Motion CARRIED 5-0. Mayor Mitchum asked if the referendum will be limited to Florida Shores unsewered areas or City-wide. Councilman Fish stated it depends on whether they go with general obligation or special asessments. Councilman Hatfield stated he wants it restricted to Florida Shores and limit the G.O. bonds. He asked Mr. Livermore if they cannot go with G.O. bonds if they go with just Florida Shores. Mr. Livermore replied one is a method of financing and one is the type of project they want to build and another question is whether it be voted City-wide or Florida Shores and it has nothing to do with financing and is a policy question for them to decide. City Attorney Alvarez noted there's a special taxing district. Mr. Livermore said they can do it by drawing a map around the area that's Florida Shores that's presently unsewered, both vacant and occupied homes and the map would show those in the assessment area and you have about four resolutions to pass to levy a special district. He noted the Supervisor of Elections will determine who lives in the area. He added they can have a City- wide vote on the question dealing with what kind of system do you want to build, but they cannot have special assessments and could put a question should the City issue 26 million bonds and not pay for it with rates and special assessments. Mayor Mitchum asked if they could have the people in the Florida Shores unsewered area vote on both questions and bonds City-wide. Mr. Livermore replied it's hard to justify because people will back the bond. Mayor Mitchum stated 70% of the population is in Florida Shores and unsewered customers subsidized the rates of 30% of the sewered customers and it was $500,000 the year it was switched over. Mr. Livermore said they can take that factor into account. Mayor Mitchum asked if both questions could be to the unsewered people. Mr. Livermore replied one question would be what kind of system do you want and you want to have G.O. pay for the low pressure or gravity instead of special assessment. Mayor Mitchum asked if they could split the ballot and have the system question in the one area and the G.O. question City-wide with some people voting on two questions and others on only the one. Mr. Livermore replied you have City-Wide vote on G.O. for financing parts of the project that include this collection system in Florida Shores and you would have to have the G.O.bond question approved and have a not to exceed a certain amount. Councilmember Bennington stated that splitting it will confuse people and make it more complicated and they should do it City-wide or Florida Shores. Councilman Hatfield suggested it be in Florida Shores area. Councilman Fish stated he wants G.O. bonds because Florida Shores has subsidized the sewer system for a certain number of years. Mayor Mitchum asked where the CIP would be if the G.O. fails. 9 Council Workshop/ Special Meeting Minutes March 14, 1990 '. "..,. """ Mr. Livermore replied they could go back to the existing financing plan. Councilman Hatfield stated that if they go with G.O. bonds he'll pay for everyone's sewer that already has it and probably still will not have it if they go with gravity. Councilmember Bennington stated util ity taxes have been supplementing Florida Shores, according to those in Florida Shores, but she's been paying higher ad valorem taxes and they should go City-wide. Mr. Livermore suggested they think about City-wide ad valorem vote but continue to pledge those bonds with water and sewer revenue and some special assessments so part of the capital cost is paid with bonds. He said they could have $15 million G.O. payable from taxes and $10-$12 million series of assessment revenue bonds such as they have in the plan. Mayor Mitchum suggested they could put a $10 million cap on it for improvements City-wide. Councilman Hatfield stated he could agree with City-wide improvements but sewer lines he feels has to be an assessment. Mayor Mitchum stated they're facing the Class II waters and other issues City-wide and what goes to the Indian River has to be treated and septic tanks in Florida Shores are going to the drainage and leaching into the Indian River. Mr. Hartman pointed out they have water system improvements. Councilman Hatfield asked if the increased rates are for expansion of the system. Mr. Hartman replied yes. Mr. Livermore stated if they increase the rates they can retire part of the bonds and they won1t have to levy taxes for that amount. Councilman Hatfield asked if it would be a blend and Mr. Livermore agreed. Councilman Fish asked where SRF figures into it and will they still participate. Mr. Livermore replied they can borrow from the State and mix the State loan with ad valorem taxes instead of rates or use the blend. Councilman Fish stated the sewer system should be restricted to Florida Shores and those affected and those that have sewers should not decide it and he made that a motion. Councilman Gold seconded the motion. Councilman Hatfield stated everyone will have to pay for maintenance of this system so everyone will be financially involved in the upkeep of either system and held be asking the people in his zone to absorb costs in higher usage fees when they don1t have control over which system is being selected. He explained the difference between the maintenance of the two systems. Motion CARRIED 3-2. Councilman Hatfield and Councilmember Bennington voted NO. There was brief discussion about a cap on the G.O. bond question. Mr. Hartman stated water treatment will be $5 million and sewer treatment is $7.5 million and reclaimed water is $1.5 million so $9-$10 million covers wastewater whether gravity or low pressure. He added that if they want to limit it to City-wide sewer, $10 million will cover it, but for City-wide water and sewer improvements combined, $15 million would be more appropriate. Councilmember Bennington made that motion. Councilman Fish seconded the motion. Councilmember Bennington clarified her motion to be water and sewer system city-wide utility improvement combined not to exceed $15 million. Mr. Hartman pointed out this excludes fire protection and collections systems for Florida Shores and major transmission mains. Motion CARRIED 4-1. Councilman Gold voted NO. Mayor Mitchum suggested this be put together as soon as possible. It was agreed to have it for Monday night I s agenda (March 19). Councilman Fish so moved. Councilmember Bennington seconded the motion. City Attorney Alvarez stated he'll bring the resolutions with the questions subject to Council's reviewing the wording and interested citizens approving it and he'll only suggest the wording. Motion CARRIED 5-0. Mayor Mitchum suggested a motion to adjourn. Counci lman Fish so moved. Councilman Gold seconded the motion. Meeting was adjourned at 11:12 p.m. Minutes submitted by: Lura Sue Koser 10 Council Workshop/ Special Meeting Minutes March 14, 1990 ;;.' ,...- ,:rEST: x.jP~ I JI~ CITY CLERK . App:oved this 2 d Apnl n day of ~ ' 199 0 . ./~ Ii' F M YOR (VICE) ~ """ EXCUSED MAYOR 11 Council W S ' orkshop/ pec~al Meet' March 14 19~ng Minutes , 90