Fort Walton Beach Council agenda — 06-08-2010 Regular — reading text

received no votes. Mr. Garvie received one vote with Patterson in favor. Mr. Minich received four votes with Holmes, Reeves, Nabors, and Rynearson in favor. The Mayor congratulated Mr. Minich on his appointment. CODE ENFORCEMENT BOARD APPOINTMENT (ALTERNATE) Appointment of an alternate member to the Code Enforcement Board. The City Clerk advised there is a vacancy for an alternate position and one application on file. Mr. Holmes nominated Valerie F. Moreland, 26 Temple Avenue SW, to serve on the Code Enforcement Board, as an alternate, for a three -year term from May 255 2010 until May 255 2013. As there were no further nominations, the Mayor called for the vote on the nomination and it carried unanimously with Holmes, Reeves, Nabors, Patterson, and Rynearson in favor ( gossom absent, Seat 4 vacant). CODE ENFORCEMENT SETTLEMENT - 205 & 207 FLORIDA PLACE SE Settlement Agreement for Liens on Code Enforcement Fines at 205 & 207 Florida Place SE. Tim Bolduc, Building Official, advised that Joseph Lorenz, the City's CodeEnforcement Attorney, had contacted him and advised he had another appointment but should arrive by 7 pm, but since he was not present, Mr. Bolduc requested the two Code Enforcement settlement items be tabled. Mr. Reeves moved to table Item 14. 1, Release of Liens on properties at 205 and 207 Florida Place SE, and Item 14. 2, Release of Lien on property at 651 Powell Drive, until the meeting of June 8, 2010 when the Code Enforcement attorney is present. Mr. Rynearson seconded motion and it carried by a vote of 4 to 1 with Reeves, Nabors, Patterson, and Rynearson in favor and Holmes opposed ( gossom absent, Seat 4 vacant).  Regular Council 5/ 25/ 10 CODE ENFORCEMENT SETTLEMENT - 651 POWELL DRIVE Settlement of Code Enforcement Case. This item was tabled until the meeting of June 8, 2010. CITY MANAGER REPORTS The City Manager reported the City is keeping a close eye on the oil spill and will continue to do so and that a clean up of the beaches and shore line has been done and efforts will continue. MAYOR/COUNCIL COMMENTS Mr. on. Holmes mentioned the Police Memorial Service and the fine job the Police Department did putting it Mr. Holmes also mentioned Ferry Park is getting a lot of use and is being kept in good shape. Mr. Nabors updated Council on the TDC's marketing plans due to the oil spill, including policy changes in an effort to refill the hotels and condos that have had cancellations since the oil spill occurred last month. Mr. Rynearson mentioned the Police Memorial Service was a dignified ceremony and the Police Department did a good job bringing it together. CODE ENFORCEMENT SETTLEMENT - 205 & 207 FLORIDA PLACE SE The Mayor advised that Joseph Lorenz had arrived and received clarification from the City Attorney that a motion would be needed to remove Items 14. 1 and 14.2 from the table for discussion. Mr. Reeves moved to remove Item 14. 1, Release of Liens on properties at 205 and 207 Florida Place SE, and Item 14. 2, Release of Lien on property at 651 Powell Drive, from the table. Mr. Holmes seconded motion and it carried unanimously with Holmes, Reeves, Nabors, Patterson, and Rynearson in favor (gossom absent, Seat 4 vacant). Tim Bolduc, Building Official, presented background information on the code violations that occurred from 2005 through 2008 on the properties located at 205 and 207 Florida Place SE, which at the time were owned by Mrs. Jody Godwin. Mr. Bolduc continued that in addition to these properties, Mrs. Godwin owned three properties ( Lots 1, 2, and 7) in Grand Oaks Subdivision in Destin, and that within the last several years, some if not all of these properties were sold. At the time of each sale, Mr. Bolduc reported a title search was performed, but the liens were not discovered and the City was not notified. Mr. Bolduc further informed that after being made aware of the property sales, the City's Code Enforcement Attorney, Joseph Lorenz, made contact with the title company to pursue the City's interest, who in turn received a settlement request from First American Title Insurance Company offering $ 5, 000 for the release of the liens placed only on Lot 1 in Grand Oaks only. Mr. Bolduc stated that the City Attorney provided him an e- mail concurring with Mr. Lorenz and recommended acceptance of the settlement offer of $ 5, 000. On February 23, 2010, the City Council was presented with a request to settle the lien on Lot 1, Grand Oaks, at which time Councilinstructed Staff to have Mr. Lorenz prepare a history of the events on the case supporting his recommendation for presentation before them at a later date. Mr. Bolduc reported that on May 6, 2010, Mr. Lorenz received a second settlement offer for Lots 2 and 7 of Grand Oaks, in the amount of $ 2,500 for each property, for a total of $ 5, 000.00. Therefore, Staff requests City Council authorization to follow the recommendation of Mr. Lorenz and accept the settlement offer of $ 5,000 to release the liens on Lot 1, Grand Oaks, in Destin; and $ 2, 500 each to release the lien on Lots 2 and 7, Grand Oaks, in Destin, for a total of $ 10, 000.00. However, Mr. Bolduc noted it is completely up to Council whether or not to accept the offer(s).  Regular Council 5/ 25/ 10 CODE ENFORCEMENT SETTLEMENT —FLORIDA PLACE ( CONT) Mr. Lorenz explained that after the liens had been placed on the properties, the owner began transferring lots that she owned in Destin to buyers, and that three of those transactions appear to be insured by title insurance companies. The decision was to contact these title insurance companies to make a claim, and that is why there are offers from First American Title Insurance and Westco Title Insurance. Mr. Lorenz noted the issues involved in litigation including the economic downturn and how it affects residential foreclosure, and the high cost of foreclosures when title companies are involved. Mr. Reeves expressed his concern that the offer from the title companies are minimal considering the amount of the lien in the amount of $ 240, 000 against the owner of the properties. Mr. Reeves stated his feeling that the presentation by Mr. Lorenz contained a lot of unknowns and feels better clarification could have been given by Mr. Lorenz. Mr. Lorenz stated he is only making a recommendation to accept the offer; if Council wants to proceed with foreclosure he will move forward with the entire amount of the liens, but the litigation would be expensive and he is providing the ups and downs to this type of litigation. Mr. Lorenz explained the courts have not been sensitive to the issue of litigation, and noted there is a homestead issue involved. Mr. Lorenz also stated that in his opinion the statute is not written correctly and is not clear. Mr. Reeves believes that when this issue was discussed previously, Council had requested a counter- offer be given to these companies so it could be discussed later, but he did not see any mention of that. Mr. Lorenz stated he was not aware of any counter -offers that he was to make, and that this is the first time he has come before Council in regards to these issues. Mr. Rynearson noted Council discussed the settlement offer at their meeting of February 23, 2010, and at that time rejected the $ 5, 000 offer and requested a push -back letter be sent to First American Title stating rejection of the offer, and that Mr. Lorenz be present to discuss the litigation. The Mayor questioned whether Mr. Lorenz was instructed to send a letter to First American Title. Mr. Bolduc responded he did not ask Mr. Lorenz to send any letter, that it was his understanding that Council wanted Mr. Lorenz present to respond to questions to determine whether or not to proceed with litigation. Mr. Bolduc apologized for his misunderstanding of Council' s request. Mr. Holmes stated his frustration that at the time of the sale of the properties, a title search was performed but the liens were not discovered and the City was not notified by the title company, and now the City is asked to accept an offer well below the amount of the liens. Mr. Reeves moved to suspend Roberts Rules of Order for the remainder of this issue and during discussion of Item 14. 2. Mr. Holmes seconded motion and it carried unanimously with Holmes, Reeves, Nabors, Patterson, and Rynearson in favor (gossom absent, Seat 4 vacant). The Mayor advised Council they can 1) accept the settlement offer, 2) not accept the settlement offer and present a counteroffer, or 3) not accept the offer at all. Discussion continued that the settlement offer would not be enough to cover the cost of administrative fees, construction fees to demolish the buildings on the property, or Mr. Lorenz's time to attend tonight's meeting; and that there is a suggested schedule of mitigation percentages contained in the City's Code of Ordinances that can be followed to determine fee and fine amounts to be paid. Mr. Lorenz emphasized there appears to be three other lots that, to his knowledge, do not have title insurance, and it is his understanding that Council is only talking about releases on the three lots covered by the title insurance, and not the other lots, and a decision would have to be made in the future on whether to pursue collection against the three lots that do not have title insurance. Council confirmed they were only taking action on the three lots covered by the title insurance.  Regular Council 5/ 25/ 10 CODE ENFORCEMENT SETTLEMENT —FLORIDA PLACE ( CONT) The Mayor asked for public input. There was none. Mr. Nabors moved to direct Staff to work with Mr. Lorenz to prepare a counter offer based on the mitigation schedule contained in the City's Code of Ordinances for the properties located at 205 and 207 Florida Place SE. Mr. Reeves seconded motion and it carried unanimously with Holmes, Reeves, Nabors, Patterson, and Rynearson in favor (gossom absent, Seat 4 vacant). CODE ENFORCEMENT SETTLEMENT - 651 POWELL DRIVE NE Settlement Agreement for Liens on Code Enforcement Fines at 651 Powell Drive NE. Mr. Bolduc presented background of the case, stating that in November of 2007 a house fire destroyed a majority of the single family home at 651 Powell Drive leaving it uninhabitable. The property owner was unable to continue to reside in the home and over the following months she and her children worked with the insurance company to resolve the issue of whether to raze the structure or rebuild it. Mr. Bolduc continued that after a series of courtesy notices and re- inspections the of property, the Code Enforcement Board issued an Order I in February of 2009. On March 13, 2009, an administrative fee of 325. 00 was imposed and fines in the amount of $ 250.00 per day began accruing, and on September 24, 2009, a letter of intent to foreclose was sent by the Code Enforcement Board to Mr. Lorenz. Mr. Bolduc reported that in February 2010 the structure was removed and the