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1971.09.14_TC_Minutes_Workshop~~ . t ',' ~ 1 MINUTES: WORKSHOP MEETING OF THE TOWN COMMISSION - Sept. 14, 1971 A workshop meeting of the Town Commission was held on Tuesday, Sept. 14, 1971 in Town Hall at 3:00 P. M. Present were Mayor Horton, Commissioners Joy, Jurisch and Hackman and a few interested persons. Mayor Horton reviewed the Franchise Ordinance contract between Highland Beach Utilities Co. and. the Town, regarding tap-in fees beginning Oct. 3, 1969 and that the system is to be completed by June, 1972. The Mayor read correspondence from the Utilities Co. and his answer, asking to arrange a conference with Mr. Urbanek. Thursday, Sept. 9th Mr. Horton met with Mr. Urbanek, Mr. Shelby Dale and the .Town attorney to discuss a proposal of amendments to the Franchise: an extension of the finish date to the length of the building moratorium, a solution of the density question and adjusting the tap-in charges. Discussion followed.. The consensus of the Comm~sion is to conduct further negotiations and take no action at the present time. Discussion took place regarding the law suit initiated by the Highland Beach Civic League and issuance of building permits. Regarding the water meter installation billing, Comm. Jurisch suggested a mark up on meters and parts only instead of the standard. pr~etice of adding 25% to the net bill, retroactive to August 1st. In regard to the Security Detective Ag,erlcy and the police matter, Mr. Horton • suggested waiting for the report from Mr. Walton to make a decision. The meeting adjourned at 4:45 P. M. APPROVE ATTEST• OWN LERK DATED: ~~~ ~y~T~ ~- i .. Sewer Workshop Meeting - Highland Beach - September 14, 1971 Commission Members present: Messrs: Horton, Jurisch, Hackman and Joy. Horton: This is a workshop meeting. It has to do with our contract with the Highland Beach Utilities Comapny. As background, let's review the contract and basically what it said. We agreed to issue a franchise on highland Beach Utilities Company and they agreed to put in a sewer system in two phases. The first phase has been completed. 'The second phase to have been completed by June 30, 1972. In consideration, the IIIiUCo. putting in the sewer system, which incidentally the town was to rent for a dollar a year or lease for a dollar a year and operate it and after ten. years, the end of ten years, we were to buy it for a dollar. In consideration for all of this, HI3UCo was assured that we would as necessary f~$ ---- ---establishing connection fees, ---- to start at $175.00 the first year and to be increased 110% or to be 110/ of the previous year in each of the nine remaining years of the contract.? Jurisch: 01`, one second, Lou -------- Horton: Go ahead, any time you want Jurisch: $175.00 a year on this first year ------- Horton: I'm sorry, that was $175.00 per unit for the 1st year. • Jurisch: I never got that clear and from reading I couldn't figure that out either. Year of-----availability? . Horton: No, this is a calendar year of the ------- Jurisch: Regardless of whether the sewers are available to them or not Horton: The way the contract reads, Frank, that's right. The anniversary date of the contract reads Ocotber 3rd. so $175.00 tha first year and $192.50 the second year and $211.75 the third year and goes up, incidentally to the 10th year to something like $412.00. The money collected from these so-called connection or tap-in fees are to go to the HBUCo and if at the end of the ten year period they collect something less than what the cost of the system was to be, this this was their loss in a .business risk. On the pther hand, if they collected more, this was gain on a business risk. Jurisch: This ------is noC exactly what you said in phis letter. Horton: I beg your pardon Jurisch: Tl~~s letter to you that you read at the last meeting inferred that his position was now being in jeopardy and he feared the------off I forget what the _terminolgy was. Horton: Let me gather Jurisch: -----rezoning which threatens to reduce x~t:t~xicm density to a confis• '-- cat, : ng level. i- -2- U Horton: I tell you, let's get the full background. I think we're ,just about complete on the full background except that I hasten to say, that at the time of the final negotiating session, when we arrived at this agreement there was some talk about the town underwriting this project but the HBUCo decided against having the town do this because they obviously thought that there was an opportunity to realize some profit. Now, this brings us up, Frank, to what I think you were talking about in this letter of August 25th from HiiUCo addressed to the commission. f i Letter signed by August Urbanek, president of HBUCo was read. Incidentally, Les, would jtou ask the girl to give you a copy of the book that contains ordinance 151. We may want to refer to that beforo we're through. I wrote a letter to him which reads as follows: "Re: your letter of August 25th summarizing the current situation regarding the franchise your company owns. It is not possible to accept the statements dnade in the last paragraph of your letter. The questions axe not related, and we'll expect HBUCo to meet the terms of the franchise. You will remember, however, that I have stated the town will be willing to meet with you at any time to discuss possible changes or amwndments to the franchise, In interest of such negotiations may I suggest we arrange for a conference at some mutually acceptable time." This was done - of course I'm merely stating that I just read the copy of the letter I wnnte back to Mr Urbanek. As the result of our Last workshop meeting it was agreed that I should write him and suggest we get together for negotiations. I met with him on last Thursday and we talked for awhile. Then I got a call on Friday morning and I didn't get home until 1:00 Pri and waiting for me was the message that Urbanek and Shelby bale, the attorney for HBUCo wanted to meet with Mr Poulton and me to discuss this thing in some detail because they apparently had aproposal to make. 'vie discussed this proposal and I"d like to get this on the table now for discussion, Joy: Wait a minute ----in this last paragraph here "HBUCo will not agree to construct any connection to the proposed Bel Lido sewer lines until you extend the June 30th deadlinet~ Isn't that a breach of contract? Horton: Yes Joy; He's threatening the town if he doesn't get his way to do .what he wants that he will. not construct it Horton: Actually there~s another aspect of this, Les,~they don't have to construct any connection. The way the system is laid out the charges for constructing the connection are borne by.the people putting. in the laterals and that is what is being done under improvement district #1. Joy: Well, what he says here is not true Horton: What he says here is, strictly speaking, not true. Joy; He still gets the Cap-in charges... • j --3- • Jurisch; He isn't performing his function Joy: HBUCo does not perform the actual physcial------ Horton: That's righC. They don't do the actual work. Joy: But he catinot stop the men from Bel Lido from connecting to the existing lines. Horton: No. The only --- to Belabor that point a little bit -- there aee several sections as you remember to improvement district ~~1. There are four sections. Highland Beach Urive doesn't have any residences on it. Russell Drive doesn't have any residences on it. That leaves isel Air Drive and the Bel Lido Island. B21 Lido Island has, of course, most of the people od which we're talking in improvement district ~~1: There are some 30 homes either under construction or already constructed and thes people will -- would like the tap-in charges quoted. The i~BUCo has nothing to do for the people of Bel Lido Island to tap-into the force main which is in the ground. Matter of fact, in one section of the contract ordinance 151 it is stated that they will agree to accept the sewerage from anyone who wants to put their sewerage into the line as long as necessary conditions are met; that is paying the tap-in charges. There is however a section between, if you can visualize ' this, Russell Drive and Bel Air Drive. There is a lift station at the foot of Russell Drive but there is nobody living on Russell Drive. mn • Bell Air B+rive there is a 4-plex unit. Improvement district ~~1 contemplates putting a gravity line from the Intracoastal down to AlA passing the 4-plex un4~t. However, there has to be some place for the sewerage to go when it gets to t11A. The proposed plan which has been agreed some months back b~ the H13UCo was that they would pay for the construction of a gravity line from the lift station at the foot of Russell Drive to Bel Air Drive so that the sewerage from that 4-plex could be collected in that fashion. They'er going to have to tlo.this by June 30, 1972 anyway. This amounts to, I think it's, 532 feet of line between--- Juischi the lift station and the end of Bel Air. Horton: the lift station and where the gravity line would come down Bel Air Drive. Now ---- , Joy; This is the gravity line? Horton: This is the only work that the HBUCo would have to do ---if they don't do it----it means that 4 people on Bel Air Drive would be without service---but the remaining people on Bel Lido Island would be getting - --- - the service anyhow because this is the------in terms of the contract they can't refuse it. Now --- the ah----originally as I mentioned the-----it was agreed by the HBUCo that the engineers, Russell and Axiom, should for bid prices for the entire improvement district ~1, including the cost of putting in the gravity line, 532 feet of line, we dust mentioned. And that this cost would be borrne by the HBUCo and not • be part of the assessment against the other people. Now this is nix the only place that I hope I haven't gone into too much detail (for fc3ns~x~aftfGx~[3C7dxR~7elCRxx that) but it's certainly better we underdtand what this is all about. -4- • Horton: Now, I blink the information in this letter of August 25 was basically an effort to get in writing the feeling of the HBUCo that they wanted some kind of adjustment. Now at the meeting last Friday afternoon between Mr Urbanek, Mr Dale, his attorney, rir Poulton and I, Mr Urbanek suggested that they would want several things and felt that these would be as amendment to the franchise and these would be fair and reasonable etc. First thing the HBUCo wanted an extendion of the finish date to equal. the length of the moratorium. Now, I originally said that I didn't see the connection - that the date of completing the system making the systen itself available, had nothing to do with the building moratorium. However, Ilr Urbanek's comment was to this effect -- that IIBUCo doesn't have any money -- and in order for it to get money there has to be some building going ori•-• so that they can collect tap-in charges. lle feels that before , their original plan was that they would use tap-in charges as the money with .which to construct and he felt, therefore, that the moratorium had deprived them of the ppportunity of picking up tap-in charges and he said that ----- extension of the finish date would be allowed to be----- number of months------ whatever it would turn out to be. I told him leter that I thought that this was something that the commission would go along with. I didn't understand it originally but I did later that the reason why ---now------ Jurisch: That•s number one? Horton: Yeahn that's number one--•- Joy: ---two and three?-- Horton:. This is all part of the package----- Joy: He must have entered into this contract ------- Horton: Let me say one other thing. He did say that he wasn't sure whether they would use all of this extension or not. Said his plan is to contact his bankers and see if favorable interest rates are available at the moment. Tf the interest rates are available ----se---now it's going to take him about 4 months according to the, engineers ----so that we have June, May April and March., If he starts before March lst, he ought to be able to complete the job by the end of June. So that if. between now and March 1st he finds that interest rates are favorable he could go ahead with whatever is best from his standpoint. Now, the fact is, Jurisch: I'm going to-wait til all three statements are made before I comment on---• Horton: With that comment, I mean does that -------- Joy: He wants to enter into this contract knowing that at that time ---- nothing was projected beyond, to my knowledge, other than the 4 or 5 buildings that are now under con8truction or'have been constructed since that date. So he did take a calculated risk at that time that there would possibly be no more buildings other than his-•-•- Jurisch: The interest rates were higher at that time f Horton: Thanes right: r -5- Joy: I'm saying------ Horton: There's one thing, I think, Les----~3oca Hi had announced that they plan- ned to put in about 1000 units and of course he hadn't told us at that time, at least noC to my knowledge, but he was figuring on some 2600 untts of his own in all his proerties. The 2180 units he asked for in fiiarch covered only certain pieces of the property and if he figures 2600 gross - so that he then figured 2600 gross with 1000 at Boca Hi. plus whatever is in town now which seems I've:~figured it up so many different times----- Roberts: What was---- Jurisch: We'll get back to the sticky stuff afterwards. Roberts; Comes out to about 750 Horton: No, that's the number that already----well those are hhe numbers that are in the north end--- Roberts; wie~l, that covers Boca Hi Horton: Covers 100 out of Boca Hi ' Hackman: You have to consider that the Monteray House is planning another building on the east side and Radice is planning 2 buildings and Royal Highlander is planning 2 buildings. Joy: These are still just in the projected area.. Horton: No Hackman: They all contributed to the fund-for the survey Horton: No Jurisch: They were supposed to but I don't think---- Hackman: Some of them got their money back Horton: Some of them didn't. The original plan was that they would prepay their tap-in charges Joy: Other than Anderson and Manteray House, Holiday Inn and Seagate - the • only ones that have actually paid anything in--•- Horton: Boca Hi Joy: Did they pay, in? Horton: Yes Joy: For 100 units Horton: 110 Joy: YrepaidY r . -6- Horton: Yes. These were for explicit prepayment of tap-in charges. Any • monies that were to go into utilities were to be credited later, for the tap-in charges. They were figuring at Chat Cime, I assume, something in the neighborhood of S or 6 thousand units as a gross number. Now this is speculation as to what his thoughts were --as a matter of fact I do know -- at one time he told me he anticipated up to 7000 units in addition to what was in town. When I say what was in the town, I don'C mean any of Chis construction, I mean, Frank, your place, Highland Towers, Carlton House and then going down the line to all the others. Whatever that amounts to - maybe 304 gross units. I don't know maybe 250 or something of the sort. That's certainly not a big number as far as they're concerned. I raised a question at that time. I said, we were getting some people in town who are complaining about the fact that the tap~~n charges. are going up even though the sewers are not available to them. So wouldn't it be equitable that the anniversary date of Che tap-in charges be extended to equal the date of the completion of the system. Jurisch; Availability. Horton: In other words if he were to complete the system by 4 months after June 10th or June. 30th. Yes, availability.. Jurisch: i;verybody should start at $175.00 Horton: Well---- • Jurisch: I can't connect up--•-- Horton: Frank,------I Jurisch: Follow me Horton: I follow you. Let me Robertd: No, but you could if you'd pay your tap-in charges, with the possibility of it being completed next June. Horton: You can pay tap-in charges anytime you want to Jurisch: I never gave it a thought. Only one good reason - I don't have the money. Horton: One thing that always be done - we have -- this ~s a matter of fact came up in another letter from ~ to read to you. Jurisch: Oh excuse me, before you go on, I'd like to get all three of these discussions out ~- so I have 1, 2, and 3 so we know Ur~aneks side and we can pick away at it again. Roberts; Chris, are you going to explain this, number 2 is the possibility of extending the tap-in charges. • .Jurisch: Is that what he said? Horton: This is what I mentioned to him and he agreed that Chia would be equitable -- tap-in charges Joy: Item 2? . -7- Horton: No - tap-in charges would be delayed to equal the-any delay in the completion of the system beyond the June 30th date. Now let's get back to--I think what we must remeUer now is that we had done originally when we passed this ordinance and that was we set up the charge of $175.00 for the 1st year with a 10% increment each year to handle the cost of this money. ile bought the money at a high rate and this 10'/. was to take care of it so that from his standpoint and this is actually what happpened. If he expended something like $350-!+00,000 to put in the initial system and if he received tap-in charges Q1S0,000 of that ]1e has something like $250,000 unpaid on which he's paying interest and the increase in tap-in charges supposedly will handle his Interest. I see what you are saying now and to the best of my a~lg recollection none of us were good enough to think about it -- at the time we wore negotiating -- that is the availability of the sewers Jurisch: Yeah, because theoretically if this thing drags on here for ---- baby--- he says. poop on you, you know----- Horton: Now wait a minute - if he does that he abnegates the contract and we take over the system. He's $250,000 in it---- Jurisch: I'm a little ahead of myself here because you've got discussion problems----I'd like to get it one, two, three - these things we're discussing so we don't get repitious. Roberts: Would you hold it a minute while I turn this tape. • Horton; In consideration of that I suggested the extension of the tap-in charges it wouldn't hurt any more that the way it's set up at the moment and to this there was no disagreement. Secondly, we talked about ghe satisfactory solution to the density question - isn't final. This is what he said in the letter - that is point number 2 Juriich: Point ~2 said what? He wants to what? Horton: Satisfactory solution to the density laxxBic~n question. Joy: Would you repeat that? Jurisch: Satisfactory------ Horton: solution to the density question Jurisch: Solution-----satisfactory to him Horton: Well, obviously Jurisch: alright Horton: The--ah--at the meeting however-~--- 3urisch: Now wait a minute, 1ou you can't-----let's state item ~3 Horton: Alright, number 3 - adjusting the tap-in charges. - $- i Jurisch: Adjustment of tap-in charges----If I were negotiating I think I'd do--•- it's all one sided -- O1C now we'll talk. Horton: Now, these are the three things he talked about in his letter------ finish date is number 1----As far as the density question is concerned we more or less ignored that---I'll explain why later-----ie raised the point in discussion about a proposal which he made that it may very well be that the present legislation regarding density might not be the only such legislation in the remaining $ years of the contract. In another 3 years it--people may want to--feel that--- Jurisch; Bring it up again. Horton: Jurisch: Horton: • Joy" Horton: Jurisch: Horton: Jurisch: Horton: Jurisch: • Horton: Jurisch: I beg your pardon? If it gets loose again ------I was talking Co Bair Abertaathy - the history is that you set something and then they begin to chip away at it---- on density question. i-Ioweverm it certainly is possible that it tighten. This was more or less ignored on Friday. Now, while we're talking about that--- this is a letter which was typed just today - I went over to the attornsy's• office and got it---this----reading as follows: "ivlr Urbanek called on Monday September 13 just before leaving for Europe. He has been unable to get either you or Mr Dale, who is his own attorney, on the telephone. He said that his northern bank wants about 6 ot.8 points for a loan and that accordingly that his effective return on $192.00 paymmnts which return charge is only about $175.00. He suggests a scheme whereby the parites involved now pay the town $192.50 --- which the town could keep the fund until the sewer was available to those persons who,had paid. At which time the funds would be paid to the uhility co. They would be amenable to the town investing the funds thus----security during the interim. Now this is bascially ~3 - about the tap-in charges. He thought something should be done about that. Would you repeat that? Reads above letter again"-------is only about $175.00." I m~,tst confess I don't understand that, 6 to 8 points, if that is in addition to--- I don't know if that's .accrued or is that interest rates. 8% interest Points to me mean something else. Points, that's what they mean to me. If you get 6 to 8 points, youve got a lousy bank. . -9- 1-[orton: That's what I was thinking---- The banker could realy ------ Jurisch: ------- Horton; I don't know, I really don't understand it but any rate what he's saying Jurisch: Let's assume it's interest forgetting the bank involved. Horton: What he is saying is his effective teturn on $192.00 payments is • only $175.00 and he suggested phis prepayaent business. Now, these are the original suggestions and and after we get around now to the big thing he is suggesting and because ----and incidentally I told him again in our conversaaion that if the utility Co. was being put in an untenable position by the town-----But we the town, would be willing and bole to take over the system from them either now or underwrite his loss, if any at the end of 10 years ----- he wasn't interested in that proposal. Jurisch: Not interested in the town guaranteeing the loss --- that means the other way, he wants to make money, It's very obvious. Horton: I-Ie says this.--- that--- I reminded him of the conversation of course, that the condominium market has been sliding sideways for 18 months or so and there are now - the figpre given me - is that there are some • 6800 condominiums on the southeast coast of Florida that are available for sale • Jurisch: Two months ago it was 8000 in Dade and Broward. Horton: -The number I heard was 6300 Jurisch: Check it Horton: ------ Jurisch: --------- Horton: Anyway we know the market isn't doing particularly well. And there are economists, of course, who say the market isn't going .anywhere. Ah---- and his comment ws if the maricet slides sideways for the next 8 years he recognizes that this was his loss because he had made his investment based on the fact that there would be a market. But he did feel that the gvound rules had been changed in that the gross number of units -now is probably being lowered and would probably be lowered and therefore he would not have the opportunity to recover as much as he had when the agreement was made. Now I think we're all in agreement or realize no one can forecast what•s going to happen in 10 years abd what I hear from my people - developers - that the possibility of zoning law changes is one of the risks of doing business. So that there was never any assurance that the gross potential would not be changed. ltowever, I had told him that tae would be happy to discuss these things. We werennt interested in seeing anybody lose money - this wasn't • our purpose at all. If they weren't going to make as much as they had anticipated making that was something else. but we were asxanmsx not anxious to .see them lose money. So he came up with this. suggestion - that if the town would pass on to him the tap-in charges up to 1500 untts and ,,.,, excluding the units of the two principal owners of the Utility Co. i ''-10- n LJ n U • Horton: That is Urbanelc and F3oca rti, excluding all the tap-in charges that have thus far been made - about 750 - exclude the new tap-ina in developement District ~~1 which are about 34 - 34 here put that down. what we've got in is about 750 ---what they plan between them---- Jurisch: You talking about Redice and Urbanek now---- [iorton: No, Roca IIi and Urbanek ----- It would be 2600 of his own plus 900 more for i3oca Iti - that would be 35A0 units plus ---- Novo investment has 2 more buildings 0 t11ey were originally in ofi this deal. They've got 50 roughly --- round it off to 60. That makes 4,444 units. These would be exclided and that the town would get anything over the 1500 additional units that he is asking for and there is no indication of time on these 1500 units--------- Jurisch: If the town would give him the tap-in charges ---- 1500 units over and above their 4400 ------ he in turn would do what? Horton: They would turn over the system to the town for a dollar whenever this 1500 number was reached. This could be anytime. Joy: at $175 x 1500 Horton: $29Gi.00 is the average for 10 years - it goes from $175.00 to $412.00 Jurish: Suppose its $200 right now - supposing the town wants to say ----- 1500 Are we talking prepaid $200 x 1500 we get the system? Horton: These are prepaid tap-fn charges, Frank.----prepaid $300,000 - he would be interested in the system, of course he's------ Jurisch: Unless my mind is off on a tangent here someplace there's about 4000 scheduled now -- these are to be excluded from his discussion. Horton: Yes sir Jurisch: Now if the town would do what? again? Horton: If the town would ---- when the town collected tap-in charges up to 1500 units other than the exclusion----we paid this over to the utility co. ----have the-----. r Joy: 5900 units so you said before the town could own the system - that in addition. to what there is Horton: No, now wait a minuts that's not quite right. Whenever the 1500 number was reached. Maybe ~x of the remaining 4400 -- maybe only 1000 had been built - but if there were 1500 out of the exclusions then the system would belong to the town. Joy: Not at the end of 10 years 1[orton: Not at the end of 10 years. It could be anytime - 2 years - it could be 12 years could be 20 years Joy: The additionof 5900 units would have constructed-before the town i -11- Joy: would own it. • iIorton: No, no, no 1500 units aside from the exclusions. Joy: That's what I'vs got here -- 4400 Horton: Those are the exclusions-but the exclusions don't have to be built say no exclusions are built -•-- Joy: Oh, OK Horton: What he &s saying is he would not pay any tap-in charges for the 4400. Jurisch: In other words for the 4400 Horton: Ilis tap-in charges would obviously be reflected in his selling price I mean whatever he figures he would have to come up with -- Are we--•- Jurisch: I'm with you now Horton: OK Jurisch: ----one hand with the other --it' as simple as that Horton: This was the number as of--•- Jurisch: Are these 4400 all his? • Roberts and others: No, some are Radice and some are .Boca Hi - Radice, no. Horton: He had originally figured on 2600 units. Now, as a result of our agreement this number is down ------Boca Hi had 1000 units, and 650 that are already in, in addition to 100 in Boca Hi--In other words, the two . penthouses. Roberts: I've got 659 - and that includes Boca Hi, I've got 2 penthouses and 2 Seagate----- Jurisch: This excludes the people that contributed to this fund originally---- iIorton: Those who prepaid tap-in charges. Jurisch: That's the group that is involved Horton: Yes, that's right. Jurisch: OK Horton: Now there are several things it seems to me that--- that was Coffee Break Horton: This was the situation as of Friday. Yesterday, as far as the telephone _ _ call between Urbanek and Poulton about which Poulton wrote me--- Because • of the fact as I mentioned before the effective return on $192.00 payments is only $175.00----- He wants to change the 1500 d~nits figure to close -12- • Morton: to 2000. You take our 4444, we had 5940 before, add 2000 to 4444 we get 6444 units.. I think there are several things to be considered. The engineers, Blacltwell and Anderson, in their report, forecast that the town would have in the year 2000, 5500 living units. Now, we're already talking about numbers that are well beyond what the engineers have forecast we will have for the year 2000. Now---this is the thing that hit me immediately. Air Urbanek on the other hand pointed to the hair tlbernathy report which talks about the fact that something like 208 acres of undeveloped land in iIighland Beach, subtracting the 75 acres owned by Urbanek and Boca Hi you come up with 133 acres that are available got development. I don't know what kind of unit of development you want to take - of course if you take 60 per acre you come up with 7980 units that could be put on 133 acres. Jurisch; Which is within 500 of------ something----the total town capacity. HortonC dotal of 6444 which takes into account the development of the partners of the utility plus-------. Now if the density on these remaining 133 acres was 30 - you come up with a potential 3990 units so what he's asking is that of the areas available for development in town, the town would have to have '~ of that area developed in order to Nny get these 2000 units before we pay off the system. Now, he is not particularly concerned about the Hoffman proerties. They own supposedly 40 acres. . I must confess, I never actually measured to see if its 40 acres or not. I don't know precisely what they own. a Roberts; I don't either Horton: nut if they were to develop 30 per acre, obviouslt there's 1200 units right there. And that's when he was talking about 1500 units on Friday, it didn't sound too bad -- Now he is talking about an additional '500 units. Seems to me we're----- Jurisch: Going backwards Hrotnn: Going backwards - particularly when the engineers forecast that the total number of living units by the year 2000 would be 5500. Roberts: That was on the other zoning wasn't it? Horton: Yes, but this is ----I think this 5500 number is -----do you lioave a Bair Abernathy report handy? Roberts: Wili you get it, it's on top of the file cabinet in a green folder. Joy: I may -have one. Roberts: There it is Horton: Let me see it, Russ • Roberts: I thought we gave you a map the other day Joy: There's not a map in here Horton: The number of the proposed density limits, maximum population, maximum number of dwelling units according to Bair Aberma thy is 5937, so it,;s r -13- n U Horton: been in one place 5500 and the other place a more precise 5937. But this is the limit and they always figure 10% - never get beyond the 3/4 of the potential. Joy: May I interrupt you a moment. N1y recollection here that including the' units excluded and the 1500 units would only be around 4300 or 4400 units. 4400 units excluded looks a lft,tle high. Horton: No, the 4400 units excluded is right, and it could be that------ Joy; Did that include the 1500 units? Horton: No, sir. Theorectically there are 2600 units for Urbanek, 1000 units for Boca lli, which is 3600, 650 units ink which is 4250 Joy; Yeah, but should you include the 650 in fiorton: I beg your pardon Soy: Are those 650 units 'in -- that includes the towers and---- Horton: Yes Joy: That shouldn't be included then because they're already in Roberts: They're already paid for Joy: They're already paid for Horton: Yes Joy; Well, you're figuring here----- Horton: These are tl~e exclud~ons that will not count toward the 1500 number 3urisch: Well, according to the paper he ----- Horton: There's another little angle on this situation that sort of bothers me--- and I'm not quite sure---- If the number of -- let's say this 4000 units not involved which includes what's in and the exclusions - 4000 units and they round off the average tap-in charge of $300.00 --the actual average is $294, dropping the units from 4400 to 4000 ---just trying to come up with something rough here. This is $1,200,000 Jurisch: Then the system complete is going to cost 3/4 million. . ilorton: 3/4 of a million for the system--- noe in addition---- Jurisch: ie stands to make about 60% •~ Joy: Not a bad return------ Well, if he's asking to collect on 6400 units based on 250 average, he's going to get $1,600,000. Morton:. No, 2000 is the excluded number - He doesn't collect on those. -14- • • • 1-Iorton; I haven't made myself clear. Now, he is saying that the li~SUCo woll make the system available to the town when there are 2000 units paid in, other than the exclusions. Joy: I don't understand Jurisch: Well, the exclusions run to 4400 and we're talking 6400 gross. Joy: 6400 units Horton: Units 3urisch: 12,000 or the potential top of the town Joy: $250 is the. average equals $1,600,000 Jurisch: Oh Yes Horton: I see what you;re saying---he would not----- Joy: against $750,000 ----cost ilrotns The---if you round out 6000 units at $300 you come up with a million eight. $1,800,000 Joy: If you take 250----- Jurisch; May I offer some comment her now? Horton: Yeah Jurisch: :dell, first of all I am death against any long term approaches whereby outside people overate our utilities. You see it in the paper every day about Joe Slow water plant or sewerage plant and stuff------ on television the other night about bad water or something about a bad valve---and outside utilities where they're buying water from an outside source. Nell, .this is the same problem except its sewer. But anyeay, this Highland Beach group did not come in h13re with a ' (looking for a word) the idea of being gracious--they came in here with a comvlete solid business proposition. Theyneed the sewer to sell their apartments. Period! ~`he town did not have enough money at that time to do this. Now, they gotta have sewers to sell apartments - they gotta make money on those apartments. They gotta---- I think they u~ust have bought the land right because if you try to buy it back at the same price you can't. Now, I think they're asking too much from the Cown in protection to make sure they make money on this utility. I go back to what you prefaced this thing on----no place in this place di we guarantee them a profit. Aio place did we guarantee them that the zoning wouldn't channe, or that the density wouldn't be lowered and if worse cones to worse we can sit and do nothing. Ignore this letter and say we're ~;oind to hold them by the contracC. If we give any concessions, they have a point - this extension is OK to me•:~for 5 mtonths. Only if a f few other things happen because I get some feedback from people too. The availabilty of the tgp-in charges should be based on this deal that we've agreed to but only at the time of availability. TheorectiC811y you're supposed to, according to Palm $each law, hook up 90 days aflter -15- Jurisch: it's available. I don't knots what happens if you don't. The Palm • 3each iealth dept gets on you or something, I guess---but anyway---- , if someone doesn't hook up right off the bat maybe there's something ----- someone with no money maybe we have a time payment plan. Morton: t~Je'ver dot an ordinance that says if they decide not to hook up at the end of 90 days, they begin paying a usage flee. Jurisch; I'll go along with that. 3ecause it's--------but theorrectically the way this boy throws his legal weight around I'm certain that the health dept ------- ecology-------- and the cord is going to get around that we have sewers available between bodies of water Chat the state is going to protect and I bet you ~ Palm Beach and the state s going to be right on us and say "hook up". Amd if someone doesn't do it -someone's going to kick a little and they mayor of our town is going to get a letter----- Hotton; I would think that any---- Jurisch; The worst we can do is say we got your letters, we appreciate them but we're abiding by the contract. Because every thing he's talked about so far 16as been completely one sided - all the way one sided and he's giving up some money except for assuring himself in 10 years I think they'll be 6000----- this of course has been discovered, there's only so much ocean left. It's going to be that bad-----and there's going to be high rises bigger than Abernathy says there are going to be. That I guarantee. According to Abernathy --I don't think my ' building is offensiceB--I couldn t build my building today. ray building would not pass Abernathy's deal. I think it's too tight but I know you've got a committee working on it so I suppose they'll come up with some loosening up---you always do. Hut I'm not in sympathy with what he says here. This is a gentle threat that he's going to do certain things which I say. I don't care what he's going to do. We got to get file hell out of Chat because he's being protected no matter what happens Joy: There's no assurance's that----- Jurisch; In about 3 years, I'm not going to be sitting on'this commission, I hope not! I hope the water plant is working by Chen---- .Lorton: I hope so too Jurisch: But alt----- Hackman: Well you have to consider that the water plant---- the trouble is the situation has always been -----need filters and the materials in them has to be----- Jurisch: So far he's, saying he's not going to do this, this and this unless he gets this and he's giving his various plans now all of which protect il$m in any way we look at it and I would look at them myself and say I suppose we'll talk abouC this at the next meeting officially but ---- iorton: What II would like----- -16- Jurisch; I think if we throw something at tiles guys and lzhere is no question about it -- we are to blame somewhat--- we're changing the statement. Conclomin~um sales have slipped a little bit ---- this is a risk he has - -- ---- in doing business but we did something here and by the same token if ee extend that thing we want to get something back. Otherwise in my opinion we should say ley, remeber our contract - that's the only thing that's legal. And that's what we are going to abide by. That's a Cough attitude but so far it's one sided. I wish someone would protect me to make a profit. ciorton: Yeah, I, I----I find it awfully hard to----- Jurisch: I repeat what I said - The faster we get this back in our own hands the !zappier I will be. Let me ask one question when he goes off for bids I assume they're open bids or does he assign the contracts? Horton: I I beg your pardon? Roberts; No, it was an open bid the first time. Jurisch; When Highland Beach goes out on his opening bids, he goes and gets this bid? Horton: No Jurisch: We don't have to do it, we have nothing to say about that • Horton: Oh, I see what you mean. No, I think he whet out and got all the bids thru Russell and Axton Jurisch: Oh?------ H:iorton: I can't------- Jurisch; ,because if we're going to come down to this point in negotiating then everything's got to be under the table. Eiow much is he paying? Horton; Yeah, I would agree ----- Jurisch: rfow much is he paying, how much is he getting back. how much interest you think you have, how much risk: money do you think you have. You get your money back plus 2% or something like that. Because you're going to make money on tzese apartments and then figure out some way they show the books are right because I'm goiing thru that with Southern Bell and Western Electric now----they~re playing hanky panky with me. Horton: Well, this is--- if we weEe to take this over we would complete it on the other hand if he wants to complete it beofre we take it over once it's underwritten--- we have to know as you eay, if the bids he's presasted are good bids before he does the work Jurisch: tJell, we know that r3a~txxi~dsthere are bids but he could assign bids • to such and such and etc---- xmxtiaa not that I'm eluding to hanky panky, I'm not but if he's assigning. something - maybe somebody else could do it for less. I know that there are qualified engineers and I know • Jurisch: they~re inspected by the health dept. Roberta: This was an open bid 'in lines with construction-- -- -17- Jurisch: probably works it that way----but then we are going to have to protect anything they say alright?----up to--------- regardless----?_/ profit or something. slow are you going to arrange it I'd go along with that it's as good as interest rates and a couple mpre points, if you want to call it, that I would think I would go fo The town is not in a position now with----•-putting on a bond----however I think it would be picked up so fast it would make your head swim. Horton; I think we would do better even going Co a bank. Jurisch; I think Bel Lido was subscribed in 4 minutes or something like that bang, bang for $200.,000, so we need another $550,000 for the whole town Horton; I donut think we would have any trouble Jurisch; We could finish it ourselves. Horton: slave you got any comment? • Hack~an; No, only when we started on this basis it was a confused situation with a lot of other builders in it and the original situation changed a iot once all the other people were in there. All the others pulled out except Urbanek and 3oca Ki and Russell and Axion did sit right in this room (george Russell) explained their estimate if the town did the job $1,200,000. Jurisch: Clow much? Hackman; $1,200,000 - This did not cover engineering ea financing charges. It cost a lot more money for a town to operate to the extended method and the source of financing than a man can do business privately, where he can go out and get the lowest bid regardless, so he figyred on that, he would be able to put the system in for say $750,000. Jurisch;, Was this conversation talked about in the start of this thing? Did Russell and Axion make a survey? Or guess or was this a shot in the dark? .Hackman: This was just a wild off the cugf guess---. Jurisch: Because since that time---•--- Hackman; Well, they helped with the financing. You are wondering about the money they helped them arrange the loan. So the other builders dropped out of the company~~p far as making mone~ The builders felt they were -18- hackman;gping to hit a bonanza or make some-money off this sewer business, that they certainly would not throw in the sponge. Joy: Does Mr Urbanek have any buildings in Highland Beach at the present time? Horton: No Roberts: Yes, he does, he owns all those little motel units down there. Jurisch: They will be bulldozed out of there Joy: tie hasn't built anything or high rise or condominium. Therefore he was anticipating he was going to do some building, he.had no interest at that Cime: Joy: ale realized without sewers his land was worthless, therefore he had to invest moneyin----- hackman; That's the only reason we were able to get him to----why he and his -----no lase, no riders penthouse Roberts; Well, it was the same for all those condominiums, that's why Highland's couldn't open up and that was the first one that wBBt on the sewer system. They could npt open up without that sewer being completed. Hackman: If it hadn't been for Mr Urbanek-----Give him credit for ------ Horton: ----obviouslt the report of the conversbtion I had with him on Thursday I offered that the town would underwrite him eo that he wouldn't lose any money, but he wasn't interested. I said then yours interested in making a profit, he said , sure.• Joy: Well, I.11 go along with that figure•---everybody wants to do that Roberts: Sure • Jurisch: 3ut the town, I don't think is in a position to guarantee that profit :[orton: I don't see how we can possibly---- Jurisch: Unless I've got some inuendo or slander I'm reading into it - he has tossed out about three different solutions to this thing all of which protect his position. Morton: That's right Jurisch: I think right now, you said he is in Eurppe,f I think right now we ought to do this or not, but this workshop meeting, but the consensus or whatever it be, ---wait until the next meeting, we can't oee where we will ever by in the position ----that all these things he has offered so far are unacceptable. -19- • Horton I would like with your permission, of course, to talk with his partner, Boca ;i i owns 50% of .1BUCo. Jurisch: Urbanek is the president Hoton: He's the president -- Boca r[o and he are 50-50 partners in this thing. Jurisch; Let's understand, somehow we are going to have sewers in this town Horton: And this---I think that part of this proposal came from Rogers of docarii But before---I see no reason why we should sit and do nothing. I think we ought to show our cooperation in this thing by trying to iron out something just as.quickly as we can so everybody knows where he sits. But what I was going to ask for----- I'll throw it out now and get it when we fbnalize it -- that is I will talk to his partner and his attorney if that's what he wants and relay to them the consensus of the commission Jurisch: I said my half. Clem and Les didn't say anything--- Horton: I don't know if Clem wes through with his comments - we got off the track back there for a minute. Hackman; The only thing I would recommend is that we continue further negotiations in order tro work things out to the best advantage to the town and • Urbanek----We both have a problem so let's work at it. Horton: Ok---Les, you got anything? Joy: I don't feel we should do anything as this time, there's no assurance that we're going to new zoning of that the zoning will change at all, We do not know that. On the other hand with the present zoning that is still is in existence----tl connection fee was set up and I think it's going to create a hardship .on existing owners---you, you and Lou Horton ---to increase the connection rate at this time. Again changing the ground rules for people who have property at the present time. Jurisch: Same thing as he is saying---the ground rules are changing. He wants to change them again. Joy: Changing ground rules and I think it would be very unfair to raise to $300 or $200 or whatever the case may be and I would like to see, until a new zoning has been approved and we know where we stand, take no action for other than to discuss or negotiate, I wouldn't say ne~otigte but I would say discuss. I don't think any negotiations should be carried on -- Discussion yes. Jurisch: Can I ask a side question? You said if prepaid tap-in charge, Bel Lido, I think------does he pay interest on that or just put it in his pocket? Horton; ale was talking about the town holding it---He doesn~t Bay what happens to the return from that money. Robert: Didn't he say we could keep the investment? -20- Horton: He didn't say we could keep the interest • Jurisch: It's actually his money---- I don't think the town should be involved in it Joy: How long a period? Until? Horton;. Well, he said here We suggest a scheme where by the parties involved could pay now to the town but the toen to keep the funds until the sewer system in available. to those persons who have paid. At which time the funds would be paid to the utility co. I think what he is saying is the people can pay now and the interest in the interim would be--- Jurisch; to the benefit of the town Horton: No, would be his because he would have been paying interest on his investment in the meantime. The people by paying now would save the 10% Jurisch: You couldn't get me to invest that way Joy: Itow many could you project would be paying now: tforton: I have no idea. .There are , let me point this out, there are a number of pieces of property in town with varying numbers of unots from 6 to 10 where the people would not pay any tap-in charge figuring they are going to sell the property in fiae years and Lather than paying the complete tap-in charge and plumber to hook up to the sewer system, they • will gamble for five year and stay on septic tanks. Joy: Isn't there something in Florida or Paln Beach Health dept. -- in 30 days----- Jurisch: Florida State law Joy: afL-er availability they must hook on. Hackman: There are laws to that effect where for example in Delray and Boca and so forth, where the sewer lines runs down the street in front of the property but thousands of pieces have not hooked in but they are paying the usage charge. Joy: Shpuld they have a malfunction or need a major repair repair or overhaul they must hook in at that time. Horton: Our ordinance calls for that---- Jurisch: Like Doca and Delray - we got our from Boca and Delray Slattery: According. to my understanding that Delray has not been pressed to hook up even though the code saycs you have to hook up, but you cannot repair and as Frank says it could be that they could turn around and say as soon as tiie system comes in, and say any force from the outside whether it is the waterways, or Urbanek, making a killing, or could. be the county or some litCle old lady sitting in her ---thinkinking about ecology putting pressure and all of a sudden you as a land owner with the sewer ~ f -21- Slatteryi there euen though you have_a working system, telling you now to hook • up. There are certain properties along the ocean that we know during the five years are going to change but if they would spend $5000 it really is thrown down thr drain because the perosn buying is i;oing to rip the whole things down and rebuild anyway. There's more to it than the hook-up charge, :Iorton: There's one thing that I think, might be a little off the subject but let's rap that part up. The information we get is that the percd~lation tests on Che ridge are extremely good, because there is plenty of ground for the sewerage to go to. The perculation tests west of AlA are pretyy bad. Let's get back Co what in the world we are going to fo anybody,---- I'll be Jurisch: Letts say this---I 3:hought Urbanek was alone, i didnt; know about the other--they must have some thinking or response on this thing. Horton: I think this is partially Roger thogghts. Elowever, I'll be happlt to talk to Rogers and---- Jurisch: Check it out ilorton: Check out and do we have any----- Jurisch: I would like to also at this meeting advise then that we have had this meeting and inferm I for one se am a little sticky on this thing, • Joy: I would like to wait until we get some concrete real information on zonin, and so forth and .not enter into a contract or agreement, verbal or otherwise. Jurisch: stave we officially accepted the proposal from Bair Abernathy but not implemented it? ilorton: No, we haven't even accepted it. Jurisch: The last one'was the presentation Horton: Public Hearing Jurisch: So nothing was done Horton: The Planning Board has not agreed on a plan to present to the commission so when that's done the commission can adopt a plan and the plan can sit there for years and never by implemented. This is a possibility. Jurisch: It happened in Boca Horton: But on the other hand of we decide to implement it -- that's another aspect to the thing. This is just~a plan. Jurisch: You have to work from Something. . Joy: The moratorium expires in Ocotber -- 6th-- and the next meeting is October 6th. . ' -22- r~ U Horton: At the next meeting we are going to have to consider another extension, as much as I hate to say it, but ---- Joy; We either habe to issue permits or have a --- even present a first reading on Ocotber 5th. Juriscl--: 47hat is the story or the hassle on the1100 units or something--- lorton: The last I heard----- Jurisch: Are we through with that subject? Morton: One more thing, let me. say t11is, I'll inform them we had this meeting and tell diem there is very definitely opposition to the proposal as it stands, looks as though what he is asking is the town to underwrite- . him and matte him a profit. And this we don't feel we can do. We will find out what other possibilities there are - just talk this thing out and what can be done, wherein are they going to hurt, as you point out ----some reasonable profit over their costs.- Unlimited profit is something else. And of course I'll keep you informed. This is where we stand on this at the moment. Your other question had to do ~ with the agreement entered into in riarch Lets baclc up a minute so we're together. The last I heard 2 suits were filed by the Civic League, one asked for a temporary injunction and one ask . in for a permanent injunction. The temporary Injuntion suit was set to be heard on Friday, 20th of August and Urbanek through their Yalm ~3each attorney requested a postponement of the hearing because the attorney vas out of town. The attorney has since returned and been back 10 days or two weeks and he is planning to file a suit under mandmus action and this is they same type of suit we had on the McGuire property. rihere ki~xmx~tx in the property owner goes to the court and says these people are denying me the right to proceed with what I want to do, therefore will you direct them to issue a building permit. This is a writ of mandemus and I understand Urbanek's attorney in Palm %each is readying suc11 action at this time. Now, ehen this comes up and is put on the agenda, how long will it take? The McGuire action, seems to me, from the time we were served with the papers until the case was heard and until it went through the appellate court it something over b . months. I'd have to look it up, I don't remeber. Does that answer your question? Jurisch: That's Ok - now we have the other ones on the opposite side of the fence. Bel Lido -.Civic League Horton: The civic league would probably withdraw its suit is the mandemus action is undertalcen, With the understanding they would be conducting the defense. Jurisch: I haven't changed my opinion since the time this was set. No one said this was wrong. There was about a 30% reductcion in the density and I said fiiaaErwas alright this is what we are after, no one said until the last minute alright that's the dirty word density. Is this for Urbanek in • position to wait for six months until he can build? tdorton: If there any-•~---- r -23- Juesicit: Cause that's sort of unfair FIorton; The last two or three weeks ~ have been ---------- Now whether the mandamus action can proceed any faster than the other -•-- If a hearing on the injunction ---issuing building permits, I think this type of hearing would proceed as~rapidly as the mandemus --- Jurisch: Les mo assume something else. The LIB civic league - have they served us with anythin that we cannot do it--- Morton: I bed your pardon Jurisch: that we cannot issue these building permits. iiorton; They have instituted a suit asking for an injunction. Jurisch: That can be heard quite readily Horton: I don't know - I'm not quite sure why they decided to go the mandamus route rather than defend the suit from the civic league. I have told the people involved that---- Jurisch; The first one id the first one handled. That would eliminate the . proi~lem ssx~xxxssxc~~c~sx~xssrn~xxx • Horton: t1s far as the town is concerned if we get one hand here wants something a group of people her against it, we are going to waflt until the court tells us what to do before we move. Jurisch; Some courts would have to tell us. Slattery: Are we talking about the 11 buildings that were approved at council or the 11 proposed at that meeting? !Lorton: Tile action, request for injunction is for any buildings. Slattery: Yes, I understand that means again, any of the buildings approved by council, I don't know the date, the 11 buildings ---that means any buildings as of now Joy: Were they actually approved? Horton: We approved them. Wait a minute were getting into things here I'm not cognizant of date, steps and all that sort of thing. Hut the civic league is questioning the validity of the agreement on the 11 buildings Therefore they are aslcing for the court to grant an injunction to stay us from issuing any building pea~mits to them under this agreement Slattery: Well, the part I dont underdtand isn't the league linking the town in the action of the agreemnt the same as the, position of Mr Urbanek iiorton: Legaly------- Jurisch: Opposite ends of the pole------- r 1 -*• -24- • .Slattery: 5o is~h't the league and the town at opposite ends of Che pole? Horton: Not necesarily----- Slattery: Lecause the town is party to the contract - the agreement that permits Urbanek to build----- Horton: There are tow ways this action can be litigated as I understand it. One is the league asks the court to prevent the tozm from issuing permits under the .agreement. The other, Air Urbanek goes to court and asks t:~e courts to direct us to issue the building permits. In other words its the same question that is I;oing to be settled - one comes one way and one the ot.~er. Now, lagally, the way the action has been taken, the civic league has to sue the town. On the other hand 6Ir Urbanek sues the town. The town is ~x the one going to be in the middle ---but---in bother cases. Hotaever, the two actual litigates, in this thing, not the town, we're sitting in the middle saying what do we do. This group and this group are loin; to be the prosecutors in whatever suit comes up. Slattery_ But when the town goes into court they definitely are going to have to have legal counsel---- Horton: No, all we will do is enter a brief - I have talked to an attorney about this- that the petitioner alledges so and so and the town agrees this • is a fair statement of the suit and we are sitting her waiting for- t~~e court to tell us what to do. We are'nt going to have a lot of Ies,al expense -whether Urbanek sues or the other people. The main cost of the suit will he borne by the civic league. Now, we goC that one ---anything else? • .