MINUTES OF MEETING
NORTH SPRINGS IMPROVEMENT DISTRICT
The regular meeting of the Board of
Supervisors of the North Springs Improvement District was held Thursday,
September 6, 2001 at 4:05 P.M. in the District Office, 10300 N. W. 11 Manor,
Coral Springs, Florida.
Present and constituting a quorum
were:
Matt Lauritzen President
Salvatore J. Mendolia Secretary
Also present were:
Rhonda K. Archer Finance Director
Dennis Lyles Attorney
Donna Holiday Recording Secretary
Jane Early Gee & Jenson
Roger Moore Engineer
Patti Hitchcock WCI
Scott Davidson WCI
Jeff Grossman Resident
FIRST ORDER OF BUSINESS Roll Call
Ms. Archer called the meeting to
order at 4:05 p.m. and Mr. Lauritzen called the roll.
SECOND
ORDER OF BUSINESS Approval of the Minutes of
the August 2, 2001 Meeting
Mr. Lauritzen stated that each Board
member had received a copy of the minutes of the August 2, 2001 meeting and
requested any additions, corrections or deletions.
There not being any,
On MOTION by Mr. Mendolia seconded by
Mr. Lauritzen with all in favor the minutes of the August 2, 2001 meeting were
approved as submitted.
THIRD
ORDER OF BUSINESS Public Hearing to
Consider the Adoption of the Water and Wastewater Budget
Mr. Lauritzen opened the public
hearing.
Ms. Archer stated we distributed the
budget under separate cover. Each year
the proposed revenues are based upon the anticipated number of average
connections for the year and the new additions we anticipate will be added to the
system and that is based on historical operating experience and anticipated
development in the District. We
projected that the revenues will equate to $10,452,925. Expenditures related to the payment of debt
service will total $2,384,534 for the senior lien debt service. We will talk about the subordinate lien debt
service at the end of the budget.
Administrative expenses are $431,466.
Mr. Lauritzen stated there is a 50%
increase in health insurance but under another section it appeared to be a
decrease.
Ms. Archer stated there should not
be a decrease. The health insurance
went up a little because payroll is going up.
The reason payroll is going up is because we are expanding our system,
so not only is payroll going up administratively but we are experiencing a need
for increases in the plant and field area for the expansion of the plant
facilities and the new subdivisions. We
just received a memo from our insurance carrier this week that said because of
our claim history they propose to increase our insurance rates 38 1/2%.
Mr. Lauritzen asked did we have a
lot of claims this year?
Ms. Archer responded we had one man
who died of cancer and that was a $140,000 claim. We are working with an agent and with the same health carrier to
see if there isn't a different plan or something we can do. We are anticipating an increase. We have not budgeted for the full 38 1/2%
but we have budgeted for some increase and we will have to see what we can
negotiate. The plan comes up for
renewal on October 1.
Mr. Lauritzen asked are all the
Districts in the same plan?
Ms. Archer responded yes and because
this District had the claim for the employee who died of cancer, it is
effecting the premiums in all the Districts all over the State. We are looking at pulling those smaller Districts
out into their own policy. We have been
able to get good premiums because we are a large group when we are combined but
it might be more beneficial for some of the smaller Districts to pull out
because of our claims history.
Mr. Lauritzen stated there is a 300%
increase in the SEC reporting charge.
It went from $1,000 to $4,000.
Ms. Archer responded that is based
on the number of bond issues that are outstanding. We have to continue to do the reporting even after the project is
completed and there is no more money in the construction fund. In the early years we pay for that reporting
out of the construction fund. We have
to continue to do the reporting for the life of the bonds and when we can take
it from another source, we do and when we can't we budget for it.
Mr. Lauritzen stated the telephone
is up 50% over last year.
Ms. Archer responded that is related
to some of the telemetry for the plant facilities. We added more equipment and we are putting up an office building
and we will have phones that we don't have at the present time. It is because we are expanding and there is
more equipment involved.
The total operating expenditures are
$6,285,000 which generates a projected surplus of $4,167,000. After we generate that surplus we are
required to fund renewal and replacement and any subordinate lien debt that we
have outstanding. The bonded
subordinate lien debt has been paid off this last year but we still have
subdivision line advances that have to be repaid. We are estimating that those will be about $3.6 million by the
time we finish the fiscal year. 90% of
our surpluses are pledged to pay off the subdivision line debt and we are
allowed to keep 10% for working capital.
Mr. Lauritzen stated I read the
budget and the schedules and I think you did an excellent job. It is nicely laid out and very clear.
There being no comments or questions
from the public,
On MOTION by Mr. Mendolia seconded by
Mr. Lauritzen with all in favor the public hearing was closed.
Ms. Archer read Resolution 2001-4 by
title, "A Resolution of the Board of Supervisors of the North Springs
Improvement District Adopting the Water and Sewer Budget for Fiscal Year
2002".
On MOTION by Mr. Mendolia seconded by
Mr. Lauritzen with all in favor Resolution 2001-4 adopting the water and
wastewater budget was approved.
FOURTH
ORDER OF BUSINESS Authorization to Notice
a Public Hearing to Consider a Rate Increase for Connection Fees
Ms. Archer stated we received a
letter from Mr. McKune dated May 15, 2001 in response to my request. When we were looking at the last engineer's
report prepared by Gee & Jenson for the purpose of issuing the water and
sewer bonds, we noticed there was a provision for a rate increase during this
fiscal year. I asked Mr. McKune to take
a look at that and let me know if that was something we needed to take action
on. He indicated that it was. The reason we have been able to delay it a
little bit is because we anticipated entering into a Large User Agreement with
the County quite a while ago to reserve additional capacity in the wastewater
treatment plant for the expansion of our system into the new areas. Because that has been delayed quite a bit,
the cost of that has been delayed also.
it is appropriate since at our last meeting we executed the Large User
Agreement increase for the 1.5 MGD, that we consider the rate increase as
indicated in your agenda package for the purpose of covering the cost of that
additional treatment, transmission and disposal of the wastewater. The increase are indicated on Exhibit 1 and
are related to the connection fees and is approximately a 3% increase since the
1999 increase. If you are in agreement
we need your authorization to advertise a public hearing for these new rates.
On MOTION by Mr. Mendolia seconded by
Mr. Lauritzen with all in favor staff was authorized to notice a public hearing
to consider a rate increase for connection fees in accordance with the table
prepared by Gee & Jenson.
FIFTH
ORDER OF BUSINESS Consideration
of Permit Requests
A. Encroachment of Interlocking Brick Patio a
Distance Not to Exceed 3 Feet into a 14 Foot Drainage Easement
Mr.
Lyles stated we have the standard application for a permit to authorize an
encroachment into our easement. We have
the special conditions which are very important which authorizes us to go in
there any time we need to and if the
pavers have to be removed or destroyed, that is at the applicant's
expense, not the District's expense.
Mr.
Grossman stated I understand that.
Mr.
Lyles stated we also have the standard indemnification language which protects
the District in case there is a claim arising out of the installation of these
pavers. With engineering's positive
recommendation, I see no legal objection to proceeding. The applicant is present and he understands
the conditions.
Ms.
Early stated there is a letter in your agenda package from my office on our
review. I don't think that is a
District pipe in the easement. I think
it is an outfall that was provided when it was platted so they did have an
outfall.
Mr.
Lauritzen stated normally we don't like to do these kinds of things but this
looks like a clear cut case and I don't have a problem with it.
Mr.
Lyles stated I think your concern is whether or not it constitutes a precedent
and cause a problem in a later case. We
have on rare occasions allowed ground level, surface encroachments. The other thing the Board is concerned about
is someone who desires to erect a fence or enclosure or any kind of barrier
running down close to the waterway.
This would not be a precedent for that type of application.
Mr.
Grossman stated I am not on the canal.
I am one lot in from the canal.
Mr.
Lyles stated this is dry and it is at ground level.
Mr.
Lauritzen asked will any problems come up with title insurance for someone who
buys this property in the future?
Mr.
Lyles stated probably a title policy would have an exception on it that there
is an encroachment into a government owned easement. It would just be a note and they would not warrant title for that
patio but that will not be a problem for the District, it may be a problem for
the buyer and seller.
Mr.
Grossman stated I will be fencing my yard because it is a requirement by my
insurance company. Will that be a
problem?
Ms.
Archer asked are you going to encroach into the easement with the fence?
Mr.
Grossman responded it will be on the perimeter of my property which includes
the easement.
Ms.
Archer stated you will need a permit for that.
You can't encroach into the easement with a fence.
On MOTION by Mr. Mendolia seconded by
Mr. Lauritzen with all in favor the permit request for an encroachment not to
exceed 3' into the District's 14' drainage easement was approved subject to the
conditions listed in the engineer's review letter.
B. Request for Surface Water Management System
for Shoppes at Coral Ridge
Ms. Early stated the Super Wal Mart
being built near Heron Bay has an overall drainage plan and this particular out
parcel is going to connect to an existing manhole that they provided for that drainage. This application is for a surface water
management permit.
On MOTION by Mr. Mendolia seconded by
Mr. Lauritzen with all in favor the surface water management permit for Shoppes
at Coral Ridge was approved subject to the conditions listed in the engineer's
review letter.
SIXTH ORDER OF BUSINESS Consideration of Change Orders
A. Change Order 3 & final for Heron Bay
Boulevard 9 & 10 Phase II with Foster Marine Contractors for a Net Decrease
of $14,319.35 Bringing the Total Contract Price to $355,642.50
Ms.
Early sated this is a balancing change order to final the project. We did experience a decrease in the
quantities.
On MOTION by Mr. Mendolia seconded by
Mr. Lauritzen with all in favor Change Order 3 & Final for Heron Bay
Boulevard 9 & 10 Phase Ii with Foster Marine Contractors for a Net Decrease
of $14,319.35 Bringing the Total Contract Price to $355,642.50 was approved.
B. Change Order No. 1 & Final for Heron Bay
South with Sonic Engineering for a Net Increase of $32,020.03 Bringing the Total
Contract Price to $1,565,770.78
Ms.
Early stated this is a final and balancing change order and although this has
an increase of $32,020.03, the increase is to WCI's portion of the contract and
not the District.
On MOTION by Mr. Mendolia seconded by
Mr. Lauritzen with all in favor Change Order No. 1 & Final for Heron Bay
South with Sonic Engineering for a Net Increase of $32,020.03 Bringing the
Total Contract Price to $1,565,770.78 was approved.
Ms.
Early stated we advertised and took bids for the aquatic plant control in Heron
Bay which is a two year contract. We
took the bids on Tuesday and Aquagenix bid was $19,879.22 and after I read the
bids he realized he was in error. He
read the bid as each time he sprays, that is what the price is. He has to spray six times a year for two
years. The last contract was $66,000
but we have additional lakes and additional mitigation areas. He faxed me a letter this morning saying his
bid was in error and that if he multiplied each year by six he is actually at
$119,000 and would be the second low bid.
Ms.
Archer stated we didn't budget for this.
I didn't know we were adding new areas to the mitigation area.
Ms.
Early stated they are digging lakes constantly.
Ms.
Archer stated we didn't know they were adding mitigation areas.
Ms.
Early stated there is not much mitigation but a lot of lakes are being
added. Blue Water Aquatics bid is
$79,169.46 and I called him since the next bid is $121,301.10, I wanted to
verify that he was comfortable with his bid and that he knew the scope of the
project. He said that he is.
Mr.
Lauritzen asked have you done business with them before?
Ms.
Early responded no. They did provide
references and a list of jobs they are currently working on. I can call their references.
Mr.
Lauritzen asked should we table this until next month and you can do your
research?
Ms.
Early responded I will do that.
SEVENTH ORDER OF
BUSINESS Staff Reports
A. Attorney
Mr.
Lyles stated I want to update the Board on ARZ. I have reported once or twice in the past on the status of this
lawsuit that was filed against the District as well as against Gee & Jenson
and against Jane Early as an individual by one of the contractors in the
Parkland Isles project which was essentially sidewalk and berm
construction. We thought we were at the
point where we could bring it to you and say it is done because many of the
claims are in fact things that we agree are owed to the contractor; certain
remobilization, and a variety of minor things that add up to about
$24,000. They do not agree with that
figure. They made a counter
proposal. What we are arguing over and
have not been able to reach agreement on is how many days the contractor should
be entitled to be paid for delay, where they had to stand down, were not able
to work for the convenience of either the District or WCI or both. That is what is currently still in
dispute. Ms. Early and Gee & Jenson
are represented by their own counsel. I
have been handling this on behalf of the District and we are about $20,000
apart with this engineering firm and their attorney. I would like some guidance from the Board. I think WCI's positions and Gee &
Jenson's position is it is going to take so much money to litigate this that we
will spend more than the amount of controversy. Before we act on that we want some guidance from the Board
because you will have to approve whatever ultimate settlement is worked out if
one can be worked out.
Mr.
Lauritzen asked is this a battle over principle for future lawsuits if we
negotiate with these people. Should we
fight it on principle or pay it off to save money?
Mr.
Lyles responded it is really not principle.
We think from an engineering and legal standpoint we are correct in
holding the line. They are only
entitled to some minimal damages for delays that are our fault as opposed to
acts of God or his own problems. The
problem from a business standpoint is that it doesn't make a lot of sense to
incur a lot of legal fees for Gee & Jenson and for the District over a difference
of $10,000 or $20,000. We can easily
spend that amount of money very quickly.
We know we owe them money. We
have held their retainage all this time.
There were certain things that happened, school construction,
redirecting their activities where they were told to work somewhere else and
when you do that there is a price tag and we acknowledge that. There is sufficient money in the
construction account to pay all of this.
I just want you to know that is where we have gotten to. The other side just sent us a large packet
of discovery demands, admission requests and I sent them to Ms. Archer and Ms.
Early which is going to take a good bit of staff time and legal time.
Mr.
Lauritzen asked do you need any action by the Board at this time?
Mr.
Lyles responded I don't need anything from the Board as much as I want you to
feel that you are updated and ask any questions you may have and if we are able
to get something worked out within that range, we will bring it back to you for
a motion.
Mr.
Lauritzen stated it sounds like we should get closure on it.
Ms.
Early stated if they work it out I will do a balancing change order because we
have not finaled out this project because of this retainage and his claim.
Mr.
Lyles stated in exchange for that we will have the appropriate releases,
stipulations for settlement and all of the closing documents on the lawsuit
side so that everyone walks away clean and we are done with this. I have talked to Gee & Jenson's attorney
and they are operating under the understanding that because it is all directly
construction related, there is money in the construction account that Gee &
Jenson really doesn't have a financial stake in it. That is their position. I
have not agreed with that. I haven't
pushed the issue. I wanted to know if
we were in the realm of feasibility in terms of the numbers and it sounds like
it is. Right now Gee & Jenson
really isn't contributing anything.
This is not insurance coverage.
Ms.
Early stated the reason for that is his claim against Gee & Jenson was
against the plans and there isn't anything wrong with the plans. He constructed it in accordance with the
plans. They think he brought us in just
to bring everybody in.
Mr.
Lyles stated it is unusual in a case like this for the engineer to be sued but
they are pushing it to the limit. I'm
reluctant to tell you that this case should be settled because we have lots of
good defenses we can raise but I am very comfortable telling you that the
amount of money it will take to do all that, engineering time, legal time,
administrative and management staff, it doesn't make much sense. We will continue to try to negotiate without
incurring legal expenses and hope to have something at your next meeting.
B. Engineer
There
not being any, the next item followed.
C. Superintendent
There not being any, the next item
followed.
EIGHTH
ORDER OF BUSINESS Supervisors Requests and
Audience Comments
Ms. Hitchcock stated I want to
review with you what is going on in the area.
We are working at this time to see that University Drive and Trails End
can be constructed. There is missing
right of way from the terminus of University Drive to just north of the
Hillsboro Canal. The Broward County
trafficways plan has University Drive completely on the western side of the
section line and in Palm Beach County it is completely on the eastern
side. We have been working to come up
with an alignment that will take it from the terminus of the existing right of
way to transition to Palm Beach County.
There are four property owners involved in the right of way. One is WCI Communities, Pete Beaty, Thelma
Johnson which is the Hendricks Farm and Henry Brewer. We are also working on Trails End. The right of way is missing from the terminus over to University
Drive. Again, the property owners
involved in that are WCI Communities, Pete Beaty, and a number of doctors
represented by Mr. Valenstein. WCI is
ready to provide the right of way as is Pete Beaty and in our conversations
with Mr. Hendricks they are ready as well.
I believe the District will be building the road and we had hoped that
the District would be willing to contact the property owners to see if they
were prepared to provide the right of way at this time so that road
construction can proceed. I don't
expect there will be any difficulty with these gentlemen as this provides them
with access and for water and sewer to their property. They are trying to sell the property and
right now all they have is a little dirt road.
Ms. Archer stated all you are asking
now is that we write letters and ask them if they are willing to provide the
right of way.
Ms. Hitchcock responded that is
correct and we will help you with that.
On MOTION by Mr. Mendolia seconded by
Mr. Lauritzen with all in favor staff was authorized to contact the property
owners of the proposed right of way for Trails End and University Drive to see
if they are prepared to provide the right of way.
NINTH
ORDER OF BUSINESS Approval of Requisitions
and Invoices
On MOTION by Mr. Mendolia seconded by
Mr. Lauritzen with all in favor the requisitions and invoices were approved.
On MOTION by Mr. Mendolia seconded by
Mr. Lauritzen with all in favor the meeting adjourned at 4:50 p.m.
Salvatore J. Mendolia Matt
Lauritzen
Secretary President