HomeMy WebLinkAbout4/20/1976N
TUESDAY, APRIL 20, 1976
THE BOARD OF COUNTY COMMISSIONERS OF INDIAN RIVER COUNTY,
FLORIDA, MET IN SPECIAL SESSION AT THE COURTHOUSE, VERO BEACH, FLORIDA,
ON TUESDAY, APRIL 20, 1976, AT 7:30 O'CLOCK P.M. PRESENT WERE WILLARD W.
SIEBERT, JR., CHAIRMAN; WILLIAM C. WODTKE, JR., VICE-CHAIRMAN; ALMA LEE
LOY; EDWARD J. MASSEY; AND EDWIN S. SCHMUCKER. ALSO PRESENT WERE JACK G.
JENNINGS, COUNTY ADMINISTRATOR; GEORGE G. COLLINS, JR., ATTORNEY TO THE
BOARD OF COUNTY COMMISSIONERS; AND VIRGINIA HARGREAVES, DEPUTY CLERK.
THE CHAIRMAN CALLED THE MEETING TO ORDER AND ANNOUNCED THE
PURPOSE OF THIS MEETING IS TO CONSIDER THE TRANSFER OF THE SOUTHERN GULF
UTILITIES WATER AND SEWER FRANCHISE TO TREASURE COAST UTILITIES, INC.,
AND SIMULTANEOUSLY TO CONSIDER A RATE INCREASE FOR TREASURE COAST UTILITIES,
INC., SHOULD THEY BECOME THE NEW FRANCHISE HOLDER OF THIS PARTICULAR AREA.
THE HOUR OF 7:30 O'CLOCK P.M. HAVING PASSED, THE DEPUTY CLERK
READ THE FOLLOWING NOTICE WITH PROOF OF PUBLICATION ATTACHED, TO -WIT:
VERO BEACH PRESS -JOURNAL
Published Weekly
Vero Beach, Indian River County, Florida
COUNTY OF INDIAN RIVER:
STATH OF FLORIDA
Before the undersigned authority personally appeared J. J. Schumann, Jr. who on oath
flays that he is Business Manager of the Vero Beach Press -Journal, a weekly newspaper published
at Varo Beach in Indian River County, Florida; that the attached copy of advertisement, being
---.Ir. the (natter of 7,cdp✓n_ (<.a
In the �f Court was pub.
Bolted In told newspaper In the Issues of
Affiant further says that the said Vero Beach Press Joutnal Is a newspaper published at
Vaso Beach, In said Indian River Comfy, and that the said newspaper has heretofore
beer/ CbnHrwoualy
Published in said Indian River County, Florida, weekly and has been entered
a9 Bowed Clan mail matter at the post office in Vero Beach, in said Indian River County, Florida
far a period of one year next preceeding the first publication of the attached copy of adver-
thereenQ and affiant further says that he has neither paid nor promised any person, Firm or
int for zlication in rebatethe soldcnewspaler.or refund for the purpose of securing this adver-
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Swan to and subwAbod before me this °?f y/ of �nT 1) g.
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to
(SEAQ ,Klerk ofA Circuit Court, Indian River County, Florida)
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APR 201976,
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NOTICE
t NOTICE IS HEREBY. GIVEN that TREASURE COAST
-UTILITIES, INC., a Florida corporation, will appear before the Board
:UTILITIES,
Commissionerso Indian River County at Its regular meet"
b Ma Canty Courthouse o said County at 7:30 P.M., April 20, 1916• at
iWhkh time and place the County Commissioner will hear the ap-
pRCatkMof Treasure Coast Utllities, inC., far approval of assignmentof
Blit certain water and sewer franchise known as 'Southern Gulf
Utilities Water and Sewer Franchi6e•• doted February 16, 1960, and at
Which flow and place the Comfy Commission will hear the application
of Treasure Coast utilities, Inc., for a revision of the existing rate ane
hook-up charges authorized under the existing franchise. The legal
dafCripIlan of the areas embraced by the existing franchise and the -
Proposed rate and hook-up Crarges are as follows:
Legal Descriptions That part of Section 24, Township 33 South,
Range 39 East, Indian River County, Florida, Bordered on the
North by "to Indian River Farms Drainage District South Relief
Canal; on Me West by the Indian River Farms Ora,nage District
Lateral J. Canal; an the South by Oslo Road; on the rest by the Old
Obae Highway, also, including that part of Section 19, Township 33
South, Range 39 East, Lying North of Oslo Road and West of Old
Dixie Highway; the South 660 feet of the North 975.70 Feet of the
Southwest Quarter of the Southeast Quarter of Section 24, Township
33 South, Range 39 East, Lying West of the Lateral J. Canal; that
Portion of Dixie Gardens Subdivision Unit 4, as per Plat Book 6.
page 47, Indian River County Public Records, lying East of the Ole
Dixie Highway; and that part of Section 13. Township 33 South, '
Range39 East, lying South of the South "let Canal and East at the
Lateral J. Canal and Weston the Old Dixie Highway, all of the above
PON In Indian River County, Florida.
. Propm"*RWes a" Hook-up Chargest - -
McM6ty water Quantity Rotas. .
FbW2000Cations (Minimum) g SAD
Each Additional 1.000 Gallons -- LIS
water Hook-up and Connection Change 370.00
Mmtaly Serer sergua Rataaf
Up to SAM Gallons ............. In percent of watar Chane -
SAN to 94100 Gallops............ 5,000 g611on rate- plus 100
... . SO water charge over
2whi s.
9AW to "Am Gallons ........... 9A00gwten rate plus 75 percent
. of water, charge over 9,000
• gallons.
U.B06 "1" and Over .......... 12000 gallon. rate plus' SO
.
Pon CalI of wafer Charge over
U= 96310M
�- Sower Hook-up and Conxacf m*.... M00,00
charoa .
'TREASURE -COAST UTILITIES, INCL -
r: w:•a-Stave L. Henderson,
secretary
Approved By:•YJack G. Jennings.
County Administrator
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ATTORNEY STEVE HENDERSON APPEARED REPRESENTING TREASURE COAST
UTILITIES, INC. ALSO PRESENT WERE MR. LOWELL LOHMAN, PRESIDENT OF TREASURE
COAST UTILITIES, INC., AND MR. ED WERZYN, REPRESENTATIVE OF SOUTHERN GULF
UTILITIES.
ATTORNEY HENDERSON -STATED'THAT THIS IS ACTUALLY A DUAL APPLICATION
AS TREASURE COAST UTILITIES NEEDS TO HAVE THE FRANCHISE TRANSFERRED BEFORE
THEY CAN REQUEST A RATE INCREASE. HE INFORMED THE BOARD THAT THEY HAVE
SUBMITTED FINANCIAL STATEMENTS ON TREASURE COAST UTILITIES AND ASKED IF THE
COMMISSIONERS HAD ANY QUESTIONS ABOUT TREASURE COAST UTILITIES' QUALIFI-
CATIONS AND ABILITY TO HANDLE THIS FRANCHISE.
COMMISSIONER WODTKE NOTED THAT THE BOARD MUST DETERMINE THE
FRANCHISEE S ABILITY TO MAINTAIN SERVICES AND ASKED IF THERE WILL BE ADDI-
TIONAL CAPITAL GOING INTO THE COMPANY TO PURCHASE THIS UTILITIES COMPANY
FROM SOUTHERN GULF.
ATTORNEY HENDERSON STATED THAT THE ACQUISITION WILL BE PAID FOR
OUT OF CAPITAL ASSETS; THEY DO NOT ANTICIPATE ANY ADDITIONAL CONTRIBUTION
FROM THE STOCKHOLDERS.
ATTORNEY COLLINS INFORMED THE BOARD THAT THEY COULD VIEW THIS
TRANSFER REQUEST THE SAME AS IF IT WERE AN APPLICATION FOR AN ENTIRELY NEW
FRANCHISE,
THERE WERE NO FURTHER QUESTIONS, AND CHAIRMAN SIEBERT ASKED
ATTORNEY HENDERSON TO GO ON TO THE REQUESTED RATE INCREASE.
ATTORNEY HENDERSON STATED THAT THE ORIGINAL FRANCHISE WAS GRANTED
IN 1960, AND THE COMPANY IS STILL OPERATING UNDER THE SAME RATE SCHEDULE AS
IT EXISTED iN 1960. HE CONTINUED THAT THE COMPANY CAN ONLY EXPLAIN ITS FAIL-
URE TO APPLY FOR RATE INCREASES ON THE SIZE OF THE COMPANY AND CORPORATE
NEGLIGENCE. HE CONTINUED THAT THE SEWER PART OF THIS SYSTEM IS PRESENTLY
UNDER CITATION BY THE DEPARTMENT OF ENVIRONMENTAL REGULATION AS SET OUT IN A
LETTER WRITTEN TO THE BOARD BY THE DISTRICT MANAGER OF THE D.E.R. ENCLOSING
A COPY OF THE NOTICE OF VIOLATION. TO SATISFY D.E.R. REQUIREMENTS A SECON-
DARY TREATMENT PLANT WILL HAVE TO BE INSTALLED ON THE PROPERTY AT AN ESTI-
MATED COST OF APPROXIMATELY $70,000, ANDJHUS THEY ARE FACED WITH AN INITIAL
DISBURSEMENT OF $70,000 PLUS THE PROSPECT OF TAKING OVER A UTILITY SYSTEM
; WHICH HAS BEEN EXPERIENCING A LOSS OVER A LONG PERIOD OF TIME.
AOR -20-1976 .
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ATTORNEY HENDERSON CONTINUED THAT THERE APPROXIMATELY 160 CUSTO—
MERS, MOST OF WHOM ARE LOCATED IN DIXIE GARDENS, AND TREASURE COAST UTILITIES
NOW HAS A NEW OFFICE VERY CLOSE TO THIS FRANCHISE LOCATION WHICH SHOULD IN—
SURE BETTER SERVICE.
ATTORNEY HENDERSON THEN DISCUSSED THE COMPARATIVE STATEMENTS OF
OPERATION: SOUTHERN GULF UTILITIES FOR DIXIE GARDENS & WHISPERING PALMS PLANT
FOR 1975 AND THE PROFORMA OPERATING COSTS OF TREASURE COAST UTILITIES, INC.,.
FOR THE SAME PLANT FOR 1976. HE -POINTED OUT THAT THE SOUTHERN GULF STATE—
MENT SHOWS A NET OPERATING LOSS OF APPROXIMATELY $20,000. THIS IS ON THE
SYSTEM AS IT OPERATES TODAY WITHOUT ANY IMPROVEMENTS. THE EXPENSES REPRESENT
AN APPORTIONMENT OF THE ADMINISTRATIVE EXPENSES OF THE COMPANY AS A WHOLE
AND THE STATEMENTS WERE PREPARED IN ACCORDANCE WITH RECOGNIZED ACCOUNTING
STANDARDS APPLICABLE TO UTILITIES. HE EXPLAINED THAT FOR THE PRO—FORMA
OPERATING EXPENSES FOR TREASURE COAST UTILITIES THEY HAVE PROJECTED TOTAL
EXPENSES CLOSE TO WHAT SOUTHERN GULF SHOWS CURRENTLY, APPROXIMATELY $30,000
A YEAR, AND THE REQUESTED RATE STRUCTURE IS INTENDED TO COVER THESE PROJECTED
EXPENSES AND PROVIDE A REASONABLE RATE OF RETURN. THEY ANTICIPATE THE PRO—
POSED RATE STRUCTURE WILL PRODUCE BETWEEN $35,000 TO $40,000 PER YEAR GROSS
REVENUE, WHICH WOULD RESULT IN A NET INCOME TO THE COMPANY OF BETWEEN $5,000
TO $10,000 PER YEAR AND WOULD, HE FELT, REPRESENT A MINIMUM FAIR RETURN TO
{
THE COMPANY.
j ATTORNEY HENDERSON CONTINUED THAT THE PROPOSED RATE INCREASE DOES
REPRESENT AN INCREASE OF APPROXIMATELY 2.4/2 TIMES THE PRESENT RATES. HE
AGREED THAT THIS IS A SUBSTANTIAL INCREASE, BUT POINTED OUT THAT IT IS THE
FIRST REQUEST FOR A RATE INCREASE IN 16 YEARS AND IN THAT TIME THE INCREASE
a IN EXPENSES HAS ALSO BEEN SUBSTANTIAL. HE NOTED AGAIN THAT THEY MUST IMMEDI—
ATELY INVEST ANOTHER $70,000 TO KEEP THE SYSTEM RUNNING OR FACE INJUNCTIONS,
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AND ITIS -V. T FEASIBLE TO CONSIDER SUCH AN EXPENDITURE UNDER THE PRESENT RATE
STRUCTURE,
COMMISSIONER LOY NOTED THAT THE SOUTHERN GULF UTILITIES BILLING
STATEMENT FOR MARCH, 1976, SHOWS 199 CUSTOMERS IN CONTRAST TO THE FIGURE OF
160 STATED BY ATTORNEY HENDERSON.
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LOWELL LOHMAN, PRESIDENT OF TREASURE COAST UTILITIES, INC., AN-
SWERED THAT THEY ACTUALLY HAVE 156 CUSTOMERS, SOME OF WHOM ARE ON THE WATER
SYSTEM ONLY, AND HE FELT POSSIBLY THERE HAD BEEN A TYPOGRAPHICAL ERROR, BUT
COMMISSIONER Loy POINTED OUT THAT THE FIGURES SHOWN ACTUALLY ADD UP TO 199,
COMMISSIONER MASSEY ASKED IF THE RATE INCREASE WAS BASED ON LAST
YEAR S OPERATION BY SOUTHERN GULF UTILITIES AND HAD THERE BEEN ANY IMPROVE-
MENTS MADE TRYING TO CORRECT THE SYSTEM WHICH WOULD REPRESENT AN UNUSUAL
EXPENSE,
ATTORNEY HENDERSON ANSWERED THAT THE RATE INCREASE WAS BASED ON
PROJECTED EXPENSES FOR TREASURE COAST UTILITIES, AND MR. WERZYN OF SOUTHERN
GULF UTILITIES STATED THAT NO.IMPROVEME NTS HAD BEEN MADE.
ATTORNEY HENDERSON NOTED THAT THE STATEMENT FOR SOUTHERN GULF
UTILITIES WAS SUBMITTED TO SHOW THE LOSS THE CURRENT RATES ARE PRODUCING,
AND STATED HE FELT THEIR LOSS WOULD BE SIMILAR IF THEY CONTINUED WITH THE
EXISTING RATES.
COMMISSIONER Loy POINTED OUT THAT ATTORNEY HENDERSON HAD SAID
THE PROPOSED RATE STRUCTURE FOR BOTH SEWER AND WATER WOULD PRODUCE BETWEEN
$35,000 AND $40,000 GROSS REVENUE, BUT ACCORDING TO HER CALCULATIONS, THE
REVENUE WOULD BE IN EXCESS OF $50,000.
ATTORNEY HENDERSON STATED THIS DID NOT AGREE WITH THEIR CALCULA-
TIONS AND URGED THE BOARD TO CONSIDER THAT SOUTHERN GULF UTILITIES HAS AN
APPROXIMATE RATE BASE IN THE ORIGINAL COST OF THE EQUIPMENT OF OVER $100,000.
MR. WERZYN STATED THAT IT IS CONSIDERABLY MORE THAN THAT AND
WOULD AMOUNT TO APPROXIMATELY $223,000, PLUS THE $70,000 TO BE INVESTED IN
A NEW PLANT.
ATTORNEY HENDERSON SAID HE FELT THAT THE RATE OF RETURN SHOULD
BE FIGURED ON THE ORIGINAL COST PLUS THE COST TO BE INCURRED.
THE BOARD FELT THAT DEPRECIATION MUST BE TAKEN INTO ACCOUNT,
AND CHAIRMAN SIEBERT STATED THAT HE FELT THE RATE OF RETURN SHOULD BE BASED
ON TREASURE COAST UTILITIES' INVESTMENT AND NOT NECESSARILY ON A 16 YEAR OLD
INVESTMENT OF SOUTHERN GULF UTILITIES.
ATTORNEY HENDERSON STATED THAT THE PUBLIC SERVICE COMMISSION
LOOKS AT THE BOOK VALUE TO FIGURE THE RATE OF RETURN,
COMMISSIONER LOY NOTED THAT IN THE LETTER DATED MARCH 23RD
WRITTEN BY DEAN LUETHJE OF BEINDORF & ASSOCIATES TO TREASURE COAST UTILITIES
GIVING AN ESTIMATE FOR A SEWAGE TREATMENT SYSTEM, THE WORD "NEW" WAS CROSSED
OUT AND THE WORD "USED" INSERTED.
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MR. LOHMAN EXPLAINED THAT THEY ARE NEGOTIATING ON THE POSSIBILITY
OF FINDING A USED TREATMENT PLANT, WHICH WOULD SAVE SOME INVESTMENT AS THEY
MIGHT BE ABLE TO PUT IN A USED ONE FOR $50,000 OR $60,000. HOWEVER, IF ONE
CANNOT BE FOUND, THEY ARE FACED WITH PROVIDING A NEW ONE AT $70,000.
COMMISSIONER LOY REMARKED THAT MR. LOHMAN AS PRESIDENT OF INDIAN
RIVER UTILITIES SUBMITTED AN ESTIMATE ON ANEW 100,000 GALLON—A—DAY PLANT FOR
IXORA UTILITIES FOR APPROXIMATELY $60,000.
MR. LOHMAN STATED THAT THIS QUOTATION DID NOT INCLUDE ANY ELEC—
TRICAL WORK, ENGINEERING COSTS OR A POND,
COMMISSIONER SCHMUCKER ASKED MR. LOHMAN IF ANY EXPANSION OF THE
SYSTEM IS PLANNED.
MR. LOHMAN STATED THAT THERE ARE ONE OR TWO DEVELOPERS IN THE
AREA THAT THEY HOPE TO ADD ON AT SOME TIME, BUT NOTHING IS"DEFINITE SO FAR.
COMMISSIONER LOY ASKED IF THEY PLAN ANY UPGRADING OF THE WATER
SYSTEM,
MR. LOHMAN ANSWERED THAT THE.WATER SYSTEM IS PROBABLY THE BEST
PART OF THE ENTIRE SYSTEM. IT HAS A 150,000 GALLON STORAGE TANK, WHICH IS
ENOUGH CAPACITY TO HANDLE THE PRESENT CUSTOMERS AND ADD ON, THE D.E.R. MAY
REQUIRE DUAL CHLORINATING SYSTEMS, BUT THAT IS THE ONLY UPGRADING THAT MIGHT
BE REQUIRED,
CHAIRMAN SIEBERT ASKED GEORGE MCKENNA, ASSISTANT ADMINISTRATOR,
FOR HIS COMMENTS.
MR. MCKENNA STATED THAT IN REGARD TO THE TYPICAL METHOD OF DE—
d TERMINING RATES FOR UTILITIES, IT WAS HIS OPINION THAT ANY FIRM BUYING ANOTHER
I IS ENTITLED TO A RETURN ON THE AMOUNT THE BUSINESS MAY HAVE COST THEM. HE
CONTINUED THAT IT WAS HIS UNDERSTANDING THAT IT WILL COST TREASURE COAST
UTILITIES IN THE NEIGHBORHOOD OF $5,000.00 TO TAKE OVER SOUTHERN GULF UTILI—
TIES, WHICH, PLUS THE ESTIMATED $70,000 FOR A NEW SEWER PLANT, WOULD GIVE
THEM A TOTAL INVESTMENT OF APPROXIMATELY $75,000. HE STATED THAT SOME
LNCREASE IN RATES IS JUSTIFIED, BUT IT WOULD HAVE TO BE BASED ON AN ANALYSIS
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OF THE WATER AND SEWER RATES, AND IT WOULD BE NECESSARY TO KNOW THE VOLUME
OF WATER USED IN BOTH CATEGORIES TO DETERMINE WHAT IS A REASONABLE FIGURE.
• C
HE NOTED THAT IN TRYING TO ANALYZE THE FIGURES SUPPLIED HIM, HE HAD DISCOVERED
t THE RATES CHARGED BY SOUTHERN GULF UTILITIES WERE ACTUALLY LESS THAN THOSE
APPROVED IN THE ORIGINAL FRANCHISE, WHICH HELPED CONTRIBUTE TO THEIR DEFICIT.
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COMMISSIONER MASSEY ASKED IF HE HAD DONE ANY FIGURING ON WHAT
THE RATES WOULD AMOUNT TO PER UNIT -PER FAMILY.
MR. MCKENNA STATED THAT HE HAD MADE AN ANALYSIS BASED ON A USAGE
OF 5,000 GALLONS PER MONTH. UNDER THE ORIGINAL FRANCHISE RATES THIS WOULD
BE $4.59 PER MONTH AND WOULD INCREASE UNDER THE PROPOSED RATES TO $12.00 PER
MONTH. THE SEWER RATE WOULD JUMP FROM A FLAT RATE OF $3.50 TO $14.50, AN
INCREASE OF QUITE A BIT MORE THAN THE 2-1/2 TIMES MENTIONED BEFORE.
COMMISSIONER MASSEY STATED HE WAS NOT SURE THAT 5,000 GALLONS
WAS A FAIR FIGURE TO USE FOR THE AVERAGE FAMILY.
ATTORNEY COLLINS INFORMED THE BOARD THAT, AFTER REVIEWING THE
STATUTES IN REGARD TO THE BOARDS JURISDICTION OVER FRANCHISE RATES, HE FELT
THIS APPLICATION SHOULD BE CONSIDERED IN THE LIGHT OF THE APPLICANT S INVEST-
MENT RATHER THAN AS A TRANSFER OF EXISTING VALUES.
CHAIRMAN SIEBERT ASKED IF ANYONE IN THE AUDIENCE WISHED TO SPEAK
AND ASKED THAT THOSE IN OPPOSITION TO THE PROPOSED RATE INCREASE RAISE THEIR
HANDS. ALL PRESENT DID. HE THEN ASKED THOSE OPPOSING THE TRANSFER TO RAISE
THEIR HANDS, AND ONLY A FEW DID.
MATTHEW GOOD, SR. OF 733 5TH ST., S.W., ASKED WHAT HAPPENED TO
THE COUNTYWIDE SEWER PLAN AND STATED HE FELT SEWER SYSTEMS SHOULD BE IN PUBLIC
HANDS AND NOT PRIVATELY OWNED AS THEY ARE A NECESSITY AND NOT SOMETHING TO
MAKE MONEY ON.
CHAIRMAN SIEBERT INFORMED HIM THAT THE COUNTYWIDE PLAN HAD BEEN
SHELVED AS THE CITIZENS HAD OVERWHELMINGLY INDICATED THAT THE COST WAS FAR
TOO GREAT FOR THEM TO BEAR.
MRS. GWEN DUNCAN OF 524 NASSAU LANE STATED THAT SHE WOULDN'T MIND
PAYING FOR A GOOD SYSTEM, BUT THE TRACK RECORD OF SOUTHERN GULF HAS BEEN VERY
POOR AND THE RATES PROPOSED ARE OUTRAGEOUS. SHE ALSO STATED THAT SHE DID NOT
BELIEVE THAT TREASURE COAST UTILITIES HAS DONE A GOOD JOB AT HOLIDAY VILLAGE
AS SHE HAD BEEN INFORMED THE WATER THERE IS TERRIBLE AND THEY ARE CONSTANTLY
UNDER REPAIR. SHE ALSO NOTED THAT THE FIGURES PRESENTED DO NOT SEEM TO BE
ACCURATE AND HAVE MANY VARIATIONS.
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RICHARD HILDRETH OF 533 4TH ST., S.W., STATED HIS OPPOSITION TO
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THE PROPOSED RATES AND QUESTIONED THE HOOK-UP CHARGES.
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JOE POHORENCE OF 643 STH PL., S.W., ASKED IF IT WOULD NOT BE
POSSIBLE TO REMODEL THE PRESENT PLANT. HE CONTINUED THAT IF THEY ARE RUNNING
AT A LOSS, IT IS CERTAINLY NOT BECAUSE THEY EMPLOY MANY PEOPLE TO RUN THE
SYSTEM, AND NOTEDTHATMANY PEOPLE IN THIS AREA ARE RETIRED AND LIVE ON A
FIXED INCOME AND CANNOT POSSIBLY AFFORD THESE RATES. '
LOWELL LOHMAN ANSWERED THAT THERE IS NO POSSIBLE WAY TO BRING
THIS OLD TYPE SYSTEM UP TO DATE TO MEET D.E.R. REGULATIONS.
MRS. EVEYLN CHAFFEE OF 668 ANTIGUA LANE ASKED WHAT THE RATES WOULD
AMOUNT TO FOR A FAMILY USING 4,000 GALLONS PER MONTH.
COMMISSIONER Loy STATED.THAT THE WATER WOULD AMOUNT TO $8.50 AND
THE SEWER TO $1.0.62, OR A TOTAL OF $19.12 PER MONTH,
MRS. MATTHEW GOOD, SR., STATED THAT SHE DID NOT FEEL THE PEOPLE
SHOULD HAVE TO PAY FOR SOUTHERN GULF'S LOSSES DUE TO THEIR NEGLIGENCE IN GET
TING THE RATES RAISED. SHE DID FEEL SOME INCREASE WAS JUSTIFIED, BUT CER—
THINLY NOT THE ONE PROPOSED,
GERALD ALLTON OF 659 4TH ST., S.W., ASKED WHY SHOULD THE.WATER
RATES BE INCREASED IF THEY ARE NOT GOING TO DO ANYTHING TO IMPROVE THE WATER?
MR. LOHMAN REPLIED THAT THE UTILITIES SYSTEM IS A COMBINATION OF
WATER AND SEWER, AND IF THEY DID NOT INCREASE THE WATER RATES, THE SEWER
RATES, AS A RESULT, WOULD BE WAY OUT OF LINE. HE ALSO STATED THAT THE WATER
MEETS ALL BOARD OF HEALTH REQUIREMENTS AND WAS, HE FELT, AS GOOD AS ANY IN
THAT END OF THE COUNTY.
MR. R. I. STARR OF 714 5TH ST., S.W., STATED THAT SOUTHERN GULF
I HAS ONLY ONE MAN LOOKING AFTER THE PLANT AND ASKED WHERE IS ALL THE EXPENSE
THEY CLAIM COMING FROM.
si CHAIRMAN SIEBERT READ TO HIM EXPENSES LISTED ON THE FINANCIAL
STATEMENT AND NOTED HE FELT THE ADMINISTRATIVE EXPENSES LISTED WERE TOO LARGE
FOR THE SIZE OF THE PLANT,
MRS. GLADYS Fox of 653 NASSAU LANE STATED THAT THEY USE THE WATER
FROM THE SYSTEM BUT DO NOT HAVE SEWERAGE AND ASKED IF THEY WOULD BE REQUIRED
TO HOOK UP TO THE SYSTEM,
MR. LOHMAN STATED THAT IT IS NOT MANDATORY.
JOE POHORENCE THEN ASKED IF PEOPLE COULD NOT AFFORD TO PAY THE
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PROPOSED RATES, WOULD THEY BE ALLOWED TO PUT IN SEPTIC TANKS AND WELLS OF
THEIR OWN,
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ATTORNEY COLLINS STATED THAT HE DID NOT FEEL THAT ONCE YOU ARE
CONNECTED TO THE SYSTEM, YOU COULD CHANGE, AND COMMISSIONER SCHMUCKER NOTED
THAT THE LOTS ARE TOO SMALL TO ALLOW FOR A SEPTIC TANK AND WELL SYSTEM.
CHAIRMAN SIEBERT EXPLAINED THAT THE BOARD MUST GUARANTEE THAT
THE COMPANY IS ABLE TO OPERATE AND PROVIDE ADEQUATE WATER AND SEWERAGE, BUT
IS UNDER NO OBLIGATION TO SEE THAT THEY MAKE A PROFIT.. HE THEN INFORMED
ATTORNEY HENDERSON THAT THE BOARD WILL SHORTLY CLOSE THE PUBLIC HEARINGS ON
BOTH THE TRANSFER OF FRANCHISE AND THE RATE INCREASE AND COULD NOT GUARANTEE
IF THEY WERE GRANTED THE TRANSFER, THEY WOULD ALSO BE GRANTED THE RATE IN-
CREASE.
ATTORNEY HENDERSTON STATED THAT THEY ARE CONTRACTUALLY OBLIGATED
TO ACCEPT THE TRANSFER, BUT NOTED THAT WITH A RATE INCREASE THAT STILL PRO-
DUCES A LOSS THEY WOULD HAVE A SERIOUS PROBLEM,
CHAIRMAN SIEBERT NOTED THAT WE DO NOT AGREE ON THE FIGURES EITHER
WITH REGARD TO THE AMOUNT OF CUSTOMERS OR THE AMOUNT OF REVENUE GENERATED
COMMISSIONER WODTKE QUESTIONED ATTORNEY HENDERSON FURTHER IN
REGARD TO THE FINANCIAL STATEMENT AND ASKED HOW THEY PLANNED TO CAPITALIZE
THE $70,000 INVESTMENT.
ATTORNEY HENDERSON STATED THAT THEY WILL HAVE TO BORROW THE MONEY,
AND THEIR BORROWING POWER WILL DEPEND A LOT ON THE INCOME GENERATED.
MRS. JUANITA AYERS OF 629 4TH PL., S.W., NOTED THAT THE FIGURES
PRESENTED ARE UNAUDITED AND DID NOT FEEL IT IS FAIR TO BASE A RATE INCREASE
ON UNAUDITED FIGURES.
MR. .JOHN MINTON OF W. 0. DALEY & COMPANY, C.P.A., STATED THAT HE
HAD PREPARED THESE FINANCIAL STATEMENTS FROM COMPUTER PRINT-OUTS SUPPLIED HIM;
THAT HE HAD SIMPLY TAKEN THESE FIGURES AND REARRANGED THEM INTO A SIMPLIFIED
STATEMENT, AND HIS COMPANY COULD NOT CERTIFY THE FIGURES.
CHAIRMAN SIEBERT EXPLAINED THAT THE BOARD DOES NOT REQUIRE AN
AUDIT, AND IF THEY DID, IT WOULD BE EXTREMELY EXPENSIVE.
ON MOTION BY COMMISSIONER Loy, SECONDED BY COMMISSIONER SCHMUCKER,
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THE BOARD UNANIMOUSLY CLOSED THE PUBLIC HEARING IN REGARD TO THE TRANSFER OF
SOUTHERN GULF UTILITIES WATER AND SEWER FRANCHISE TO TREASURE COAST UTILITIES.
ON MOTION BY COMMISSIONER WODTKE, SECONDED BY COMMISSIONER Loy,
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THE BOARD UNANIMOUSLY CLOSED THE PUBLIC HEARING IN REGARD TO A PROPOSED RATE
INCREASE FOR TREASURE COAST UTILITIES.
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ATTORNEY COLLINS INFORMED THE BOARD THAT IN A TRANSFER YOU ARE
CONSIDERING THE ABILITY OF THE TRANSFEREE TO PERFORM THE DUTIES AS SET OUT
IN THE ORIGINAL FRANCHISE. HE SUGGESTED THAT THE BOARD MIGHT CONSIDER A
BOND TO ASSURE THE EXISTING PROBLEMS WILL BE CORRECTED,
COMMISSIONER SCHMUCKER NOTED THAT THE MEW COMPANY IS INTERESTED
IN EXPANDING THE SYSTEM, WHICH HE FELT WOULD BE A HELP TO THE COUNTY AND
WOULD BRING IN ADDITIONAL REVENUE, BUT HE IS CONCERNED THAT THE TRANSFER IS
LINKED WITH THE INCREASE IN RATES.
CHAIRMAN SIEBERT STATED THAT WE MUST KNOW THE COMPANY WILL BE
ABLE TO OPERATE EFFICIENTLY, AND WITHOUT KNOWING THE RATES, HOW CAN WE DETERMINE
THIS?
COMMISSIONER WODTKE ASKED IF ATTORNEY HENDERSON WAS SATISFIED
THAT THE NEW SEWER PLANT WOULD MEET ALL THE REQUIREMENTS SET OUT IN THE D.E.R.
NOTICE OF VIOLATION.
ATTORNEY HENDERSON STATED THAT HE WAS.
COMMISSIONER WODTKE THEN ASKED IF TREASURE COAST UTILITIES WOULD
ACCEPT A TRANSFER SUBJECT TO COMPLYING WITH THE D.E.R. NOTICE OF VIOLATION,
AND ATTORNEY HENDERSON FELT THAT WOULD BE AGREEABLE.
ATTORNEY COLLINS STATED IF THE BOARD APPROVES THE TRANSFER, THEY
CAN ADD ADDITIONAL TERMS TO THE FRANCHISE AT TIME OF TRANSFER REQUIRING COM-
PLIANCE, AND IF THEY DON T COMPLY, THAT IS BASIS FOR DEFAULT,
COMMISSIONER WODTKE STATED HE WOULD LIKE TO SEE THE BOARD CONSIDER
THE TRANSFER, AND THEN IN REGARD TO THE RATE STRUCTURE, TAKE THE FIGURES SUB-
MITTED AND LET THE ADMINISTRATORS STAFF WORK OUT THE RATE STRUCTURE THAT
WOULD GIVE THEIR RETURN.
COMMISSIONER Loy SAID SHE FELT IT WAS THE RESPONSIBILITY OF TREAS-
URE COAST TO DO THE REFIGURING AND SUBMIT IT TO THE BOARD TO BE CHECKED.
COMMISSIONER SCHMUCKER ASKED MR. LOHMAN IF HE WISHED TO HAVE THE
FRANCHISE TRANSFERRED WITHOUT HAVING A RATE SCHEDULE.
MR. LOHMAN SAID HE DID NOT.
ATTORNEY HENDERSON STATED IF YOU ACCEPT THE PRO -FORMA EXPENSES
SUBMITTED AND 10% AS A REASONABLE RATE OF RETURN, THEN IT IS SIMPLY A MATTER
OF COMPUTING WHAT RATE STRUCTURE WILL GIVE THIS RATE OF RETURN.
g 25 -_ .4=. 4
r
0
COMMISSIONER Loy SAID SHE DID NOT THINK THE BOARD COULD BE COM-
MITTED TO A 10% RETURN, BUT WOULD LIKE TO HAVE THEM REFIGURE TO SHOW EXACTLY
WHAT KIND OF INCREASE THE PROPOSED RATES WILL REPRESENT TO THE INDIVIDUAL
HOME OWNER. SHE ALSO EXPRESSED CONCERN OVER WHETHER THEY WILL HAVE A NEW OR
USED SYSTEM,
IN FURTHER DISCUSSION, IT WAS NOTED THAT THERE IS A SPECIAL
MEETING OF THE BOARD 7:30 O'CLOCK P.M. ON APRIL 28TH AND IF THE FIGURES CAN
BE GOTTEN TOGETHER PROMPTLY, AN ANSWER CAN BE GIVEN AT THAT MEETING.
4 COMMISSIONER WODTKE REQUESTED THAT, IF POSSIBLE, A COMPUTER READ-
OUT OF THE LAST THREE MONTHS' OPERATIONS BE SUPPLIED.
MR. LOHMAN FELT THIS COULD BE ACCOMPLISHED WITHIN THE NEXT FEW
DAYS.
ON MOTION BY COMMISSIONER Loy, SECONDED BY COMMISSIONER MASSEY,
THE BOARD UNANIMOUSLY AGREED TO CONTINUE DISCUSSION OF THE PROPOSED FRANCHISE
TRANSFER AND RATE INCREASE TO A SPECIAL MEETING OF THE BOARD OF COUNTY COM-
MISSIONERS ON WEDNESDAY NIGHT, APRIL 28, 1976, AT 7:00 O'CLOCK P.M.
CHAIRMAN SIEBERT INFORMED THOSE PRESENT THAT A DECISION WILL BE
MADE ON BOTH THE TRANSFER AND RATE INCREASE AT -THAT TIME, BUT THE PUBLIC
HEARING HAS BEEN FORMALLY CLOSED AND THERE WILL BE NO FURTHER PRESENTATION
MADE BY THE APPLICANT OR THE PUBLIC. HE REQUESTED IF ANYONE HAD ANYTHING
FURTHER THAT IT WAS IMPERATIVE THE COMMISSIONERS KNOW, THEY SUBMIT IT IN
WRITING ADDRESSED TO THEM AT THE COURTHOUSE,
THERE BEING NO FURTHER BUSINESS, ON MOTION MADE, SECONDED AND
CARRIED, THE BOARD ADJOURNED AT 9:40 O'CLOCK P.M.
ATTEST:
RR 2 0.1976
CHP(I RMAN