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HomeMy WebLinkAbout1983 03 01 City Commission Workshop Minutes . WORKSHOP MEETING CITY COMMISSION CITY OF WINTER SPRINGS MARCH 1, 19~3 The Workshop Meeting was called to order by Mayor John V. Torcaso. Roll Call: Mayor John V. Torcaso, present Deputy Mayor Buck Adkins, present City Manager Richard Rozansky, present Commissioners: Jim Hartman, present Inez Linville, present Martin Trencher, absent Leanne Grove, present North Orlando Water & Sewer Corp./Transmission Authority: Manager Rozansky said that we have been negotiating for sometime to purchase the Utility. The City made an offer last summer of $2,000,000 which was rejected by Florida Land Company. In December the City found out that our portion of the EPA grant (75%) 1.1 million dollars to construct an interceptor to connect us with Iron tlridge to get us ready by 1985 when we were to go on line, was being recalled by D.E.R. We sent a letter to NOWSCO and they agreed they would negotiate in good faith and they would make every effort to sell us the utility by the end of June 1983. Manager Rozansky and the Mayor went to Tallahassee with Mr. Pat West of the Transmission Authority to talk to DER but did not receive favorable consideration from the Commission. However, the City Manager recommended we continue our attempts to obtain the money while looking at other alternatives for the treatment of waste- water. The Manager felt that the key was the acquisition of the Utility Company. . Mr. Bill Leedy of the Leedy Corporation, said it is customary when a City is buying a sewer and water system that that system should be self-supporting. This system should pay for itself and the City, when it decides how much it can pay for this system, has to be governed by an amount that system can carry. There is just no other feasible way to do it. Last summer, we took the earnings of the system and figured out how many bonds, what size bond issue those earnings could retire. We made an offer of $2,000,000 payable over a ten year period of time. That was inadequate for Florida Land Company, they rejected it. Florida Land Company then applied to the PSC for a rate increase. This would enable the system to earn more money which would in turn enable the City to sell a larger bond issue and pay a higher price for the system. They have applied for an interim rate schedule and a final rate increase to the PSC. If the interim rate increase were passed, based on the information that we have from Florida Land Company, the City would be in a position to pay them approximately $2,475,000 at closing. The final rate schedule would produce $4,000,000 payable to NOWSCO at closing. Bill Leedy said they would never advise the City to make a purchase price of any kind until it has been determined which rates are going to be passed, because if the City decided to offer to pay $4,000,000 and the PSC turned down the rate increase, you could not bring it off. . It seems that we are in a wait and see posture at this time to see what the PSC does with this rate increase petition that is before them. . . . Workshop Meeting, City Commission, March 1, 1~83 Page 2 The Commission then discussed condemnation proceedings and asked that the City Attorney prepare a report on commencement of condemnation proceedings, the cost and the time involved. The Commission asked that this report be given at the next Commission Meeting, March 8, 1983. Meeting was adjourned 8:21 p. m. Respectfully submitted, Mary T. Norton, City Clerk WORKSHOP MEETING CITY COMMISSION CITY OF WINTER SPRINGS MARCH 1, 19~3 The Workshop Meeting was called to order by Mayor John V. Torcaso. Roll Call: Mayor John V. Torcaso, present Deputy Mayor Buck Adkins, present City Manager Richard Rozansky, present Commissioners: Jim Hartman, present Inez Linville, present Martin Trencher, absent Leanne Grove, present North Orlando Water & Sewer Corp./Transmission Authority: Manager Rozansky said that we have been negotiating for sometime to purchase the Utility. The City made an offer last summer of $2,000,000 which was rejected by Florida Land Company. In December the City found out that our portion of the EPA grant (75%) 1.1 million dollars to construct an interceptor to connect us with Iron tiridge to get us ready by 1985 when we were to go on line, was being recalled by D.E.R. We sent a letter to NOWSCO and they agreed they would negotiate in good faith and they would make every effort to sell us the utility by the end of June 1983. Manager Rozansky and the Mayor went to Tallahassee with Mr. Pat West of the Transmission Authority to talk to DER but did not receive favorable consideration from the Commission. However, the City Manager recommended we continue our attempts to obtain the money while looking at other alternatives for the treatment of waste- water. The Manager felt that the key was the acquisition of the Utility Company. Mr. Bill Leedy of the Leedy Corporation, said it is customary when a City is buying a sewer and water system that that system should be self-supporting. This system should pay for itself and the City, when it decides how much it can pay for this system, has to be governed by an amount that system can carry. There is just no other feasible way to do it. Last summer, we took the earnings of the system and figured out how many bonds, what size bond issue those earnings cou~d retire. We made an offer of $2,000,000 payable over a ten year period of time. That was inadequate for Florida Land Company, they rejected it. Florida Land Company then applied to the PSC for a rate increase. This would enab~e the system to earn more money which would in turn enable the City to sell a larger bond issue and pay a higher price for the system. They have applied for an interim rate schedule and a final rate increase to the PSC. If the interim rate increase were passed, based on the information that we have from Florida Land Company, the City would be in a position to pay them approximately $2,475,000 at closing. The final rate schedule would produce $4,000,000 payable to NOWSCO at closing. Bill Leedy said they would never advise the City to make a purchase price of any kind until it has been determined which rates are going to be passed, because if the City decided to offer to pay $4,000,000 and the PSC turned down the rate increase, you could not bring it off. It seems that we are in a wait and see posture at this time to see what the PSC does with this rate increase petition that is before them. Workshop Meeting, City Commission, March 1, 1~83 Page 2 The Commission then discussed condemnation proceedings and asked that the City Attorney prepare a report on commencement of condemnation proceedings, the cost and the time involved. The Commission asked that this report be given at the next Commission Meeting, March 8, 1983. Meeting was adjourned 8:21 p. m. Respectfully submitted, Mary T. Norton, City Clerk