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Mr. Jason Brown, County Administrator, stated that from the outset the County has believed that this is a dispute between the City and the Town of Indian River Shores regarding whether the Town could seek services from the County with their franchise agreement with the City. The County does not want to engage in litigation with the City over this issue. He said that he is not an expert on the Chapter 164 dispute Resolution process, but he believes the attempt there with all the necessary steps prior to litigation is to avoid litigation between local governments. He proposed that the City and the County attempt to reach an agreement to avoid a potentially costly court battle between the City and the County. He wanted to present the general framework of what the County would propose for a potential settlement today for the City's consideration. He said that County staff would propose if they are able to reach an agreement for the franchise for the City to serve the existing unincorporated customers, the County would agree with the City on the territorial agreement that it is still in affect and there would be no further dispute with the City on this issue. He understands that they have been negotiating on the franchise agreement for some time now and there are some differences in their proposals and the County proposes a compromise on this issue of the franchise agreement. He went through the main issues. The first being the territorial service agreement on the City's expressed opposition to the County's language where. the County's franchise agreement supersedes the territorial agreement in the new franchise agreement. He said the City's versions has various clauses stating that it is still in effect and what the County would propose is that the franchise agreement is silent on the territorial agreement. There would be a 30 -year franchise agreement between the County and the City for the unincorporated areas and if there is a dispute the matter would likely be resolved through litigation with the Town if the Town so chooses to debate the issue. He brought up rates and said that the County had been requesting County rates for the unincorporated areas, which they have been discussing since 2015 and last year that became an issue for the City that the City could not maintain those County rates going forward. He said that puts the County in a little bit of a difficult position because since they have a franchise agreement with the Town that provides those County rates through 2027 for the first initial 15 -year term and then maybe another 15 -year term until 2034. There is a current franchise agreement in affect with the Town where County rates are being provided, however they understand their concerns about not being able to control their own rates and set City rates. What the County would propose is that the City would maintain County rates for the unincorporated customers through 2027, which is the expiration date for the first 15 -year term for the Town agreement and then following that they would propose that the unincorporated residents would be charged City rates in the same manner that City residents are with no outside City limit surcharge as contemplated in Section 180.19(1) or other Florida Statutes that are applicable. Also they would request for some rate protection that the City would agree not to raise the rates more than 5% a year for the initial 5 -year period and following that it would just be City rates. He said that these are two (2) terms that they would propose for a 30 -year franchise agreement that goes with an initial term of 15 - years with a follow up with a second 15 -year term for a total of 30 -years similar to the structure with the Town's current franchise agreement. He said the third issue is service standards. The County would accept the City's service standard proposals and request a line be added saying that the unincorporated residents would receive the level of service equal to City customers. He said for purposes of transparency he would say that the County would agree with the City that the territorial agreement is still in place. If the Town were to file a suit challenging the City and/or challenging the County that the County would not actively participate and would basically be a neutral party. The County believes this is a dispute between the Town and the City. The County is hopeful that this proposal will enable the County and the City to avoid potentially costly legal battle and they look forward to discussing the parameters of such an agreement if they can reach a final agreement. Mr. Monte Falls, City Manager, commented that it was good to have something to discuss moving forward. He briefly gave the history of the relationship between the City and County on how all of this Page 2 June 24, 2021 Conflict Resolution Minutes