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HomeMy WebLinkAbout12/17/1992SPECIAL MEETING Thursday, December 17, 1992 The Board of County Commissioners of Indian River County, Florida, met in Special Session at the County Commission Chambers, 1840 25th Street, Vero Beach, Florida, on Thursday, December 17, 1992, at 7:00 P. M. Present were Carolyn K. Eggert, Chairman; Richard N. Bird, Vice Chairman; Fran B. Adams; Kenneth R. Macht; and John W. Tippin. Also present were James E. Chandler, County Administrator; Charles P. Vitunac, County Attorney; and Patricia Held, Deputy Clerk. The Chairman called the meeting to order. The hour of 7:00 P. M. having passed, the County Attorney announced that this public hearing has been properly advertised as follows: VERO BEACH PRESS -JOURNAL Published Daily Vero Beach, Indian River County, Florida COUNTY OF INDIAN RIVER: STATE OF FLORIDA Before the undersigned authority personally appeared J. J. Schumann, Jr. who on oath says that he is Business Manager of the Vero Beach Press -Journal, PUMM W MCE The Board Ccur a daily newspaper published at Vero Beach in Indian River County, Florida; that the attached copy of advertisement, bean of Cie of tr Rim Canty w9 h � WQAKWA m use g ' 194 Street.AD ommission Chamber h_% the�ted are . e 6roited to a'- and partl�ate to the fa8owr6rg s, /� T► November 19, 1992 - 9:00 A.M. - Sewer' and Water overview In the matter of Wednesday, November 2rede� A.M. - As - a SeweVter Thursday, December 3, 1992 - 9:00 A.M. - Sold Waste septage/Sludge overview Thfnday. December 17, 1992 - 7.00 P.M. - Expie. m Sold Waste Assam In the Court, was pub- anation nd Wednesday December 23, 1992 - 9:00 A.M. -Over. View aft, ly Dove=, �Of Servfcea; Personnel, TR management lashed in said newspaper in the issues of�a '�'� ��/�( aF and ta/Reaeatim. Anyone who �y wtkh be made at � w� n oto ensure Bert a verbatim record of the proceedings Is made,' whiche Includes, testimony and evmeroe upon WNM 1 b Anjrone who ns a special aceam oda- Affiant further says that the said Vero Beach Press -Journal is a newspaper published at Vero Beach, in said Indian River County, Florida, and that the contetc r Ytys fAameericerx�i �YDCoun- IeablUt � (ADp1 Coordinator at 6674MM said newspaper has heretofore been continuously published in said Indian River County, Florida, each daily and has been x409 at bast 48 Nov.2,112,11 Wim' entered as second class mail matter at the post office in Vero Beach, in said Indian River Coun- ty, Florida, for a period of one year next preceding the f first 949342 publication of the attached copy of advertisement; and affiant further says that he has neither paid nor promised any person, firm or corporation any discount, rebate, commission or refund for the purpose of securing this advertisement for publication in the said newspaper. /1 Sworn to and subscribed before rpe this - day of "��('D'. tg G11� I (SEAL) NMray P"f"k, 5+0to -F Fio.!A.t Ab Canet%*n Ernl►aR .h toA �g i9�1 B07 DEC 17 1997 BOOK 88 F'AGF l DEC 1 BOOK 88 PgE 319 7 Chairman Eggert announced that the purpose of the meeting was to educate and inform the new commissioners of the Utilities Department's rate structure and method of billing, as well as to answer questions posed by the public. Utility Services Director Terry Pinto gave a brief history of the Utilities Department. He then explained the charges and rate structure. The impact fee is a charge to cover the cost of the core system. There is a base facility charge which includes the cost of maintaining the grounds, operation of the facility, labor, chemicals and electricity. There is also a monthly charge for flow. He pointed out that utilities service is the most regulated industry in the country. We must have licensed operators and be fully staffed from the first day of operation. The process of aeration in the huge tanks is constant, whether one gallon or a million gallons go through, and that also is included in the base facility charge. Commissioner Bird asked for an explanation of how the impact fee and rate structure are monitored. Director Pinto explained that the Utilities Department is run as a closed system, with all revenues used exclusively for utilities. There is no way to take a profit and transfer it to another County use. If there is money left over in one year, it automatically rolls as income into the next year and is used to adjust the rates charged to customers of the system. If one customer of the system does not pay his bill, the other customers must pay that portion. Director Pinto explained that while other public service departments may delay repair or replacement of their equipment or facilities, the Utilities Department must maintain the system and repair any failures. He gave the example of potholes in the road. Repair of potholes may be delayed if there is no money for it, but if a water system fails, it must be repaired. If a sewer overflows, it must be fixed immediately. Those costs must be covered in the rate structure. Commissioner Adams asked for a comparison of our charges with the $8 to $15 per month charge that mobile home park residents currently pay. Director Pinto explained that a mobile home park's $8 or $15 per month charge does not represent anything, because the developer charges an extremely low rate as a marketing tool. The developer actually subsidizes the utility system because he is only interested in selling units in his development. Additionally, the utilities which were built by the developers had different requirements with lower standards. The County's utility system had 2 to meet new standards which are much higher, resulting in a major cost differential. When the old systems are abandoned and the mobile home parks are connected to the County's system, the true costs of buying, maintaining, operating and repairing the system become apparent. Commissioner Adams asked whether we have an automatic increase in rates when there is a mandate from St. Johns River Water Management District to conserve water. Director Pinto noted that we do not have an automatic increase. In the original plan, there was a requirement to identify what we would do in case of an emergency. Our emergency water conservation plan will commence only when a water shortage is declared and only after a public hearing. Commissioner Bird described a typical situation where a development has its own utility system, the residents enjoy low rates and everything is working, but there is an agreement to connect to the County system. He asked Director Pinto to explain why the County cannot bypass that development. Director Pinto explained that we cannot replace certain systems and allow others to continue because it is not financially feasible, it would cripple the regional system, and because it involves the health and welfare of the entire community. Once we begin a project it cannot be handled on a selective basis. He pointed out that a private wastewater treatment plant is never built in the middle of the area it will service but rather on the edge of the development, so if that system fails, it affects the neighbors and ends up contaminating someone else's well. That makes wastewater a community problem. When that inevitable failure occurs and you have not provided capacity at the treatment plant for the failed system, it becomes a major catastrophe for the community. Director Pinto related that the County is also responsible for the proper disposal of solid waste, meaning garbage or trash. Indian River County does that through a landfill. Solid waste disposal has become a very technical field, a strictly regulated and expensive operation. In the past solid waste was handled on what was called a tipping fee, wherein the hauler paid a fee based on weight. When additional landfill area was needed, the tipping fee was not enough to pay for it. Now the County .applies an annual assessment on each improved parcel of property in the county, providing steady revenue to operate the landfill and to repay the borrowed money. Recently the State required a 30 percent reduction in solid waste which called for a rather sophisticated, elaborate and expensive recycling system. That cost is also included in that 3 DEC 17 1992 BOOK 88 DEC 17 1992 BOOK 88 TACH annual assessment. Director Pinto reported that our rates for solid waste are lower than most of the surrounding counties. The cost of solid waste disposal fluctuates, depending on the need to expand the facility. Indian River County made some wise decisions to buy land some time ago, so we are not as hard pressed as some of the other counties to make investments. Steve Pitiak, president of the Park Place Homeowners' Association, came before the Board to address the issue of impact fees, water and sewer rates and the surcharge. He asked for confirmation that the residents of Park Place are no longer within the County Utility System. Director Pinto responded affirmatively. Mr. Pitiak asked if that meant that their impact fees and surcharge would no longer be collected by the County. Director Pinto explained that there is a contractual agreement between the owner of Park Place and the City of Sebastian, whereby the City of Sebastian has the right to set the rates and charges. The City of Sebastian chose the method of charging Park Place a surcharge of $10 per month per unit for 10 years. Mr. Pitiak stated that there was an interlocal agreement between the City of Sebastian and the County for the County to provide water and sewer service to Park Place until the City of Sebastian establishes its own water and sewer system. He further stated that Park Place is the only development that pays a surcharge to the County. Director Pinto pointed out that the residents of Park Place do not pay a surcharge to -the County. County Attorney Charles Vitunac noted that Bent Pine, Sea Oaks, and a few others developments pay a surcharge, but Mr. Pitiak argued that those were condominiums, not mobile home parks and they are not in the City of Sebastian but rather in unincorporated Indian River County. He asked again for confirmation that Park Place residents are not obligated to the County and are not under the rate structure of the County. Mr. Pinto confirmed that fact, and he further explained that the City of Sebastian is obligated to Indian River County for capacity in the treatment plant. The City of Sebastian had a rate hearing and passed Ordinance 92-15 on July 8, 1992. Indian River County Utilities is the billing agent for the City of Sebastian and follows their directions for issuing bills. Mr. Pitiak addressed the issue of the impact fee that is payable when a mobile home is resold in Park Place. He stated that the owner of Park Place would not issue a certificate of occupancy to a buyer of a unit until the impact fee was paid. Mr. Pitiak 4 M quoted from Florida Statute 723.004 which states that the State preempts all regulations and control of mobile home lot rents and that local government is prohibited from taking any action with respect to matters preempted to the State of Florida. The relationship between landlord and tenant is included in those preempted regulations and controls. Mr. Pitiak felt that the County violated this preemption by adopting Ordinance 91-9, specifically Section 201.12. In that Section the park owner was given 5 years to pay the impact fees, but the individual unit owner must pay the impact fee when his unit is resold in Park Place. Director Pinto pointed out that Mr. Pitiak was misreading the developer's agreement. The agreement stated that when a unit is transferred, the owner of the mobile home park will have to pay the impact fee. Additionally, the Park Place franchise agreement is the only agreement in the county which is structured so that the owner can pass the cost through to the mobile home owner. The Park Place franchise originally was set up under the City of Sebastian, not under Indian River County, and it established rates and gave Park Place Utility the authority to bill tenants directly. Attorney Vitunac emphasized that the franchise agreement with the mobile home park owner says the impact fee must be paid when the units are resold. It does not say the tenant must pay the impact fee. Chairman Eggert noted that the County is no longer a party to that agreement. Mr. Pitiak also complained that when the pumps burned out and the water system went down in Sabal Palms, which is the next-door mobile home park, they used Park Place water for over a month but did not pay a surcharge for that water. He considered that discriminatory. Mr. Pitiak quoted from a transcript wherein Director Pinto stated that the County has no authority to address the ability of the mobile home park owner to pass the impact fees and other charges to the tenants. He felt that the County said one thing and did another, and that is why mobile home park residents are so frustrated. Chairman Eggert said that the Commissioners are also frustrated and are trying to get the legislators to do something about this problem so that everyone clearly understands their obligation. Mr. Pitiak discussed the sale price of the utility system at Park Place and felt that the County did not follow established procedure in arriving at a price for that utility. Director Pinto explained that the price was established based on original construction costs and allowing for depreciation. 5 DEC 171992 Boor. 88) F. DEC 17- NO BOOK 88 P4E.323 -7 Mr. Pitiak questioned the County's procedure in taking over the Park Place franchise, and he accused the County of making a deal with the developer without notifying the Park Place Homeowners' Association. Director Pinto disagreed and stated that there was a public hearing before the ordinance was adopted. He emphasized that Park Place is no longer part of Indian River County Utilities. The City of Sebastian has control of Park Place utilities. Mr. Pitiak asked whether that meant that a home owner does not have to pay the impact fee when he sells his home. Attorney Vitunac explained that the County never said that the tenant has to pay anything. The requirement is that when a mobile home is transferred, some money is due under the franchise agreement. The County cannot favor one side or the other. The County wants to be paid and deals only with the landowner. Mr. Pitiak asked the Commissioners to send a letter to the mobile home park owner instructing that when a home is resold they cannot withhold a certificate of occupancy until the impact fee is paid. Director Pinto explained that the Commission does not have the authority to send that type of letter. Discussion ensued, and Commissioner Bird clarified that the mobile home park owner does not issue a certificate of occupancy. He further clarified that from the very beginning the Commission has consistently taken the position that impact fees that are due for units in a mobile home park are the responsibility of the mobile home park owner. If the owner has a lease agreement with the tenants to pass that cost through, that is between the park owner and the tenant, and the County has no authority to intervene. There is no permit or license or anything that the County would withhold from the buyer when a mobile home is sold. However, if the park owner has some ability through a lease agreement not to allow that new owner to occupy that unit until an impact fee is paid, that is between the owner and the tenant. Commissioner Macht felt there was misunderstanding regarding the term "certificate of occupancy." Bill Ramsey, president of the Aspen/Whispering Palms Homeowners' Association, clarified that Mr. Pitiak means that the owner has the right to reject anybody who wants to purchase a home in that park. Commissioner Macht felt that under the circumstances we could write a letter to the mobile home park owner saying he should not use the County as an excuse or as a means to threaten the tenants. He felt that such a letter would not violate Florida Statute 723. 6 M M M Attorney Vitunac agreed that it would not violate Florida Statute 723. He explained that the County chose the time of the sale of a mobile home as the time the impact fee was due but could have chosen any point in time. He stressed that the County never said that the impact fee was to be passed through to the tenant. Mr. Pitiak agreed with Commissioner Macht's suggestion and felt that would satisfy the mobile home owners in the county. John Grayson, representative of Heritage Village Homeowners, Association, recounted the history of his park's connection to the County water supply and the ensuing legal action. He stated that the residents were pleased when the Commission maintained that the owner is responsible for payment of the water bill. However, a few weeks later, the attorney for Merrill Lynch came before the Board and the Board reversed its position. He accused the Commission of having private meetings with the attorney for Merrill Lynch, and he wanted an explanation of the Commission's action. Attorney Vitunac explained that on October 20, 1992 he gave a report to the Board of the Court's action on the issue of Heritage Village. Attorney Larry Barkett, representing Heritage Village, was in, attendance and spoke for about 15 minutes. After that meeting the attorney for Merrill Lynch asked for equal time. He appeared before the Board on November 24, 1992. Larry Barkett also appeared, and both attorneys had an opportunity to address the Board. Mr. Grayson said that because of the sudden change in the Board's decision, the people in Heritage Village are concerned about the motives of the Commissioners. There were accusations of personal interests, possible affiliations between the Board members and Merrill Lynch, or contributions from Merrill Lynch to the elections of the Commissioners. Commissioner Tippin took exception to the comment and offered to make his financial statement available at any time. Chairman Eggert stated that she has investments but does not deal with Merrill Lynch directly, and she has not received any contributions of any kind for 3 or 4 years. County Administrator Jim Chandler interjected that he was at both meetings and was aware of both motions. He explained that the first motion was to resolve the situation in the best interests of the residents and not force the County to turn the water off. There was a suggestion to file a lien against the park owner. It sounded simple, but as the attorney for Merrill Lynch pointed out, before you file a lien, you must give 30 days notice. If the bill is not paid in 30 days, you shut the water off and then you can file a lien. At the November 24, 1992 meeting, the attorney for F DEC 171992 800K -7 r F3 aooK F+Grp Merrill Lynch said, "Turn the water off," and the Commissioners were trying to protect the County's rights as well as serve the interests of the residents, and at the same time not get involved in the landlord -tenant relationship, so they suggested escrowing the payments. Commissioner Bird recollected that the first discussion on October 20 was basically one-sided with only the presentation by Attorney Larry Barkett, representing Heritage Village. At the November 24 meeting the Commissioners heard from the attorney for the owner as well as County staff. The Board could not ignore a $90,000 overdue bill for water which was increasing by $20,000 per month. Commissioner Bird felt that Attorney Vitunac came up with a reasonable compromise, which was to have both parties escrow the payments. The Board's decision was an effort to protect the County's interest. Commissioner Macht explained that his vote was based on the arguments of the parties and on the facts and the law. He assured the public that he and the other Commissioners were concerned about the rights of the citizens of Indian River County and made the best possible decision under the circumstances. Chairman Eggert added that there were penalties involved, and the Board was concerned that if the tenants lost the case, there would be enormous penalties for non-payment. The suggestion to escrow the payments was an effort to avoid those penalties. She agreed the decision was made to try to protect the County and the residents. Mr. Grayson was sure the residents would not lose the case. He brought up the point of past accusations of conflict of interest and asked whether the Commissioners discuss possible conflicts of interest. Chairman Eggert advised that the Commissioners do not discuss anything other than at meetings because that would violate the sunshine laws. Commissioner Tippin stated that he never had any conversations with the representatives of the owner but had telephone conversations with residents of Heritage Village. He was not influenced at all in making his decision. Ralph Simeon, a customer of Vero Beach Utilities, objected to all the little extra fees on his bill and asked for an explanation of the 6 percent County fee that appears on his bill. Director Pinto explained that the County charges Vero Beach Utilities 6 percent gross receipts tax, just as the County would charge any private utility company. - M M M Commissioner Adams felt the detailed bill was good because the public deserves to know what it is paying for. Louis Holland, resident of Heron Cay, objected to the minimum charge when he is not living in that home. He said that when he leaves his.Heron Cay home and goes up north, he turns off the cable service, the electricity and the telephone and receives no bills, but continues to receive a minimum bill for utilities. Director Pinto explained that even though he is not using the water or wastewater system the plant cannot shut down, the aeration tanks must continue to operate, and the employees must be paid. Mr. Holland stated that when he is up north he receives a utility bill and sends his payment on time. If it is delayed in the mails and arrives late, he is charged a penalty. He thought the Utilities Department should pay attention to the postmark date, as other government agencies do. Bill Ramsey felt the utility bill does not explain the charges. He also thought a return envelope should be included for the convenience of senior citizens because if they need an envelope, they must go all the way to town and that is difficult for retired citizens. He gave examples of the hardship experienced by residents when the owner of Aspen/Whispering Palms began making demands on senior citizens, particularly widows. He stated that the residents were forced to sign an agreement to pay the impact fee or their rents would be raised, so in order to have peace of mind they signed the agreements. Mr. Ramsey accused the County of creating agreements with the park owners which affected the residents. He also objected to a rate increase. Director Pinto clarified that this meeting was not to discuss a rate increase but rather to give the public and customers of the utilities an opportunity to voice their concerns. He felt it is very important for everyone to understand that the park owner is our customer and is responsible for paying the bill. The ordinance specifically states that tenants are not responsible for the bills. Mr. Ramsey asked why the bills are sent to the individual residents if the owner is responsible for paying them. Director Pinto explained that the Utilities Department must send the bills where the customer directs them to send the bills. If we do otherwise, the customer can say he does not have to pay the bill because the Utilities Department did not mail them to the proper address. Mr. Ramsey suggested a statement at the bottom of the bill that the bill does not have to be paid by the tenant. 9 CLEC 17 1992 BOOK 8 F'';r.:��6 FF,_ DEC J7 1992 BOOK88 PAGE .32 7 Director Pinto thought we possibly could state that the final disposition of the bill is the responsibility of the property owner. Discussion ensued regarding when water would be shut off to an individual mobile home. Director Pinto reported that we have not turned off water to anyone in a mobile home park, but we do have that right. Ed Cleary, resident of Heritage Village, thought that his charge for water should be discontinued when he leaves town and goes up north.. Director Pinto responded that as long as a customer is part of the utility system, there -is a minimum charge. When a water meter is turned off, the connection must stay in place and the treatment plant must continue to maintain the capacity that is reserved for the customer. Ed Nelson, resident of Countryside North Mobile Home Park, read from an article published in the Press Journal on November 26, 1992. Director Pinto interrupted, and stated that Mr. Nelson was reading from a newspaper editorial and that the writer did not know what he was talking about when he wrote it. The editorial discussed the rate structure and accused the County's consultant of making a gross error. Director Pinto stated that there was no error. The projections were made 1-1/2 years earlier and included the cost of a sludge facility. An adjustment was necessary because the construction of the sludge facility was delayed. Mr. Nelson asked- about the General Development "package plants," and Director Pinto responded that they are not package plants. General Development has a Marolf-design contact stabilization treatment plant in Sebastian. The City of Sebastian is talking about what use they can make of that plant. The General Development plant in Vero Beach Highlands is a concrete, poured -in- place plant. The County looked at the Vero Highlands plant because we have to build a south county plant, but General Development is not interested at the present time in selling that plant. We have an agreement with the City of Vero Beach that at some point in time we must take capacity from the City of Vero Beach and build our own plant, and we will build that new plant in south county. Mr. Nelson questioned why General Development was allowed to keep their privately -owned treatment plants but Heritage Village is not. Director Pinto said the difference is obvious when we look at the General Development rate structure versus what it costs Heritage Village to operate their treatment plant. If the City of 10 Sebastian buys that treatment plant from General Development, they will pay about $3 or $4 million. That cost must go into a rate structure, so even though it is the same plant that has already been paid for, the utility customers who will benefit from it must pay for the cost of acquisition. Another difference is that General Development was issued a 30 -year franchise about 20 or 25 years ago which did not require them to abandon it and connect to the County system. Mr. Nelson continued discussing the history of the utilities within the county. He described various situations in Heritage Village and the difficulties experienced by the residents. Mr. Nelson discussed the lawsuit being heard by Judge Kanarek and accused the Board of going against a decision made by Judge Kanarek. Attorney Vitunac clarified that Judge Kanarek made no decision. He only said it would be nice if the parties mediated the issue. When the mediation failed to take place, the Commissioners chose the only sensible option, which is the escrow agreement. Commissioner Macht added that Commissioner Bird's motion on November 24 was couched in strictly humanitarian terms and was an attempt to save the residents from a very unpleasant procedure. He recalled that Mr. Barkett favored the Board's decision because he agreed to meet and discuss the details. Mr. Nelson noted that Commissioner Adams voted against the motion. Commissioner Adams explained that she voted against the motion because she felt that the Board's action would only delay the pending court proceeding. She asked for an update on the case. Attorney Vitunac understood that the residents of Heritage Village voted not to go along with the escrow agreement, although he had not heard that from Attorney Larry Barkett yet. He also advised that utility bills would be sent from the Utilities Department the following day and if the bills are not paid in 30 days by somebody, the water would be turned off. Mr. Jacoby, resident of Heron Cay, asked how much it costs for each bill, why individual bills were being sent, and who pays the extra cost. He urged that one bill should be sent to the owner of Heron Cay. Director Pinto responded that it costs $4 for one bill for water and wastewater. He explained that the Heron Cay system was originally set up on individual meters. The utility lines are within the rights-of-way of the park but are operated and maintained by the County. There are lines that run off of these it Q E C 17 1992 BOOK 88 F+%F D -C 17 1997 -7 BOOK 88 F': ;E , s lines to individual meters which are owned by the park owner. The bills are sent to the individuals because that is what the owner of the park directed the Utilities Department to do. If the owner says, "Send the bills there," we have to send the bills there. Director Pinto advised that State law holds a tenant responsible for utility bills. However, we have taken the position of obligating the landowners for payment of the utility bill, so we send the bill where he tells us to send it. Commissioner Macht asked for an interpretation of the law in that regard. Attorney Vitunac advised that Director Pinto is correct, and to do otherwise is to place the County in the position of deciding who pays the bill. Glen Baldwin, resident of Countryside, suggested that the landowners name ought to be on the bill. Carl H. Gales, resident of Heritage Village, described himself as a minister of the gospel. He stated that the park owner is taking advantage of the residents. There being no further business to come before the Board, the meeting adjourned at 11:30, ;P.M. ATTEST: J. arton, Clerk 12 /C, Carol y K. Egg Chairman