Fort Walton Beach Council minutes — 12-05-2001 Special — reading text

11 4;; ..... A Special Meeting of the City Council of Fort Walton Beach, Florida, was held on Wednesday, December 5, 2001 at 5: 30 p. m. in the Council Chambers at City Hall, with the following members present: Mayor Glenda Glover I Councilmen: Clay Carnathan, Janet Baggett, Jim Tucker, Dr. Wayne Pullen, Chuck Kelley, and Mike Anderson Absent: Jim Dowling Also Present: Reid Silverboard, City Manager; Helen Spencer, City Clerk; Jerry Miller, City Attorney; Joyce Shanahan, Finance Director; and Department Directors The Mayor called the meeting to order. tJAm..........~"'_!...;..] 1U$......~~~; Consideration of a Resolution awarding Capital Improvement Revenue Bonds, Series 200 I. Richard Lott, with Miller, Canfield, Paddock and Stone, Bond Counsel, explained his firm has been preparing the Bond documents in connection with the transaction. Council will consider tonight adoption of a resolution that will take care of all the business necessary to complete a Bond issue that was approved by Ord. 1462. Since that time, AG. Edwards, the investment- banking firm hired to sell the bonds, has determined there are investors interested in buying the Bonds at particular interest rates and they are willing tonight to sign a contract with the City for the purchase of $5, 740, 000,000 of the City' s Capital Improvement Revenue Bonds, Series 200 l. He noted the Bond Purchase Contract is attached as an Exhibit to the Resolution and if everything is in order and Council decides to go forward with the Bonds, the adoption of the Resolution will include the approval of the Bond Purchase Contract with AG. Edwards for the sale of the Bonds, will authorize the appropriate officers of the City to complete the transaction, to close the Bond issue and receive the funds from AG. Edwards from the sale of the Bonds and apply those funds to the uses for the projects. In addition, as part of the resolution, Council is approving the final offering document, or prospectus being given to investors to let them know the material financial information about the City and the Official Statement has been modified to insert all the detailed information concerning the Bond issue. He pointed out the Bonds are insured by Ambac Assurance, which caused the Bonds to have a AAA rating. The resolution implements Ord. 1462 and sets all the terms and provisions of the Bond issue, the interest rates, maturities, redemption provisions and the right to pre-pay the Bonds in the future is limited for the first ten years. The resolution approves authority to do all that is necessary to proceed with the project and upon adoption, Council will have committed themselves for the payment of the bonds and will be required to annually appropriate from non- ad Valorem revenue sources enough money to pay the Bond issue Mr. Lott further explained Council's responsibility and reviewed the Federal Securities and Exchange laws which include the requirements that a Municipal Government cannot take any action that will prohibit an investor from getting any information for the next 30 years, to provide information in an annual report as well as I when certain events happen, and to make sure the investors have correct information. Mr. Lott cautioned Council to review the preliminary Official Statement and if there is any problem with it to contact the Finance Director, the City Manager, or himself within the next three or four days so the necessary correction can be made when the document is printed in about five days. Jim Free, with William R. Hough, Financial Advisor, briefly reviewed the pricing report of the Capital Improvement Revenue Bonds, Series 2001 and recommended the City proceed with the Bonds issue. Jim Gallihan, with A G. Edwards and Sons, Underwriters for the Bond Issue, reviewed the final structure for the $ 5, 740, 000 Bonds, the interest rates for the Bonds and the costs associated with the transaction. He pointed out a tvDO that will be corrected to reDlace Nassau Countv with the City of Fort Walton Beach.  12- 5- 01 1 2 IRES. 01- 32: CAPlTALIMPROVEMENT_ VBMJBBONbS,SERlES_ tl The City Attorney read the resolution by title only. A RESOLUTION AWARDING $ 5, 740, 000 OF THE CAPITAL IMPROVEMENT REVENUE BONDS, SERIES 2001, OF THE CITY OF FORT W ALTON BEACH, FLORIDA, TO THE UNDER WRITER; FIXING THE PRICE, INTEREST RATES AND TERM MATURITIES, IF ANY, FOR THE BONDS; AUTHORIZING USE OF PRELIMINARY AND FINAL OFFICIAL STATEMENTS IN CONNECTION WITH DISTRIBUTION OF SUCH BONDS; DESIGNATING THE PAYING AGENT AND REGISTRAR FOR THE BONDS; PROVIDING CERTAIN OTHER DETAILS RESPECTING THE BONDS; AUTHORIZING ALL OTHER NECESSARY ACTION IN CONNECTION WITH THE ISSUANCE AND DELIVERY OF SUCH BONDS; AND PROVIDING AN EFFECTIVE DATE. Mr. Tucker moved to adopt Res. 01- 32. Mrs. Baggett seconded motion and it carried unanimously with Carnathan, Baggett, Tucker, Pullen, Kelley, and Anderson in favor Dowl ( ing absent). 1Bo.~ JNGI The pre- Bond Closing will be held December 19th and the securities transaction will take place December 20th PURCHASE AGREEMENTWl1BMP'~~ Consideration of a Purchase Agreement with S& P Management of Florida, L.L.c.,for a Pistol Range property on Ready Avenue, and consideration of a proposed Solid Waste Transfer and Disposal Agreement with BFI of Florida. The City Manager reported a majority of the negotiations were concluded yesterday and there are still a couple of points outstanding. He explained an ordinance with two readings is required to sell property, with the first reading at the regular Council meeting December 11th and second reading at a Special Council meeting December 18th, and the action requested of Council is their blessing to the broad outline presented tonight so that th on December 11 Council can have a more extensive discussion on the Ordinance and have answers for any questions brought up this evening. The City Manager recounted that BFI approached the City to purchase the pistol range property on Ready A venue only if the City would agree to enter into a Disposal Agreement to take garbage to the transportation station once it is built; and if the City is unwilling to enter into a Disposal Agreement, then BFI would not go ahead with the property purchase. He said they have been negotiating two issues, the purchase of the property and the disposal agreement. The City Manager described the parameters of the purchase agreement. He stated there were two appraisals, one for $ 1, 040,000 and another for $ 1, 015, 000 and BFI has agreed to pay the average of the two appraisals, 1, 027, 500. 00 as the purchase price for the property. One of the conditions is that the cost of clean up of the property, because it is a former pistol range, would be deducted from the purchase price and the cost of the environmental study to determine what needed to be done would also be deducted from the purchase price. He said the $ 30, 000 estimated for the environmental study has been adjusted to $ 28, 064.08 and that is the amount that would be deducted from the sales price. The City Manager recalled Council preferred to have the clean up cost fixed so BFI had an engineer do an evaluation of the property and developed two scenarios for clean up. He said the first scenario was to clean up only the part of the property of the pistol range BFI would purchase. He said most of the actual pistol range is located on a strip of land 150' wide that the City intends to keep. He said in the second scenario, BFl & S& P Management are guaranteeing, once they do the clean up, they will then assume full environmental responsibility for the site, and the City would never have to worry about any future contamination or claims of contamination; but BFI is only willing to do that if the entire site, including the City' s portion it will retain, is cleaned up because of the difficulty of cutting off at part of the berm and leaving the rest of the berm on the City' s side unclean and they could never know for sure whether contamination is coming from the unclean portion; that is the reason why BFI wants to do the entire clean up. Mr. Tucker received confirmation that on the portion that will belong to the City, the City will never have to worry about pollution from that area, and getting blamed for it.  12~5- 01 13 IPURCllASEAGRUMINT eoat.f The City Manager stated that is why BFI wants to do the entire clean up so that there is some benchmark where they will say the site has been remediated and they accept responsibility from that point forward. BFI will also certify that the City' s piece is being remediated also, so that if some type of pollution comes up on their property and they say that it's coming from the City' s, the City will have certification of the clean up that all the pollution has been cleaned up from both pieces of property. He noted the cost for cleaning both pieces is much higher and in order to set a fixed price they agreed to use the average of the low range and the high range, which ends up being $ 323, 815.48, so that amount would be deducted from the purchase price and then the City would receive the balance after all the deductions. He said they negotiated the contract with the second scenario because it is I to the City' s advantage to get it all cleaned up so there is no question about future liability for pollution. The City Manager said another part of the Agreement include the fact that they intend to subdivide the property into four parcels, one being about eight acres for the transfer station and then three one acre parcels along the He said BFI has been advised there is no guarantee that will be approved, but if they meet all the frontage. subdivision and other requirements, they should get approval, but the City cannot certify that at this point without knowing exactly what they are going to do. Mr. Tucker received confirmation from BFI & S& P that once BFI purchases the property, they are assuring the City they will clean up the entire area and there is no way in the future the City can be blamed for any pollution that comes up on that area. Pat James, with S& P Management explained DEP would certify the clean up and issue a certification. BFI will allow the City to hold the cost of clean up in escrow until they receive certification from DEP that the entire site has been remediated. He said tw04hirds of the contamination is on the site the City is retaining so it is better to go in while they are mobilized on the job and clean the site in its entirety. The Mayor received confirmation that BFI will remediate the site in it' s entirety then there will be a fence between the City' s property and BFI' s property and easement access for the City, but BFI will never be on the City' s property. The City Manager said the other aspect; after the berms have been cleaned there will be a substantial amount of dirt still there since they will not haul away the entire berm. He said Mr. James has requested the remaining dirt on the berms for use on their site. Council will need