10-03-1995 Special Meeting CITY OF CLERMONT
MINUTES
SPECIAL COUNCIL MEETING
OCTOBER 3, 1995
A Special meeting of the City Council of the City of Clermont was held Tuesday,
October 3,. 1995 in the City Hail conference room. The meeting was cailed to order
at 6:00 p.m. by Mayor Pool with the following Council Members present: Council
Member Sargent, Council Member Norquist, Council Member Dupee, and Council
Member Cole. Other City officiais present were City Manager Saunders, Finance
Director Van Zile, and City Attorney Baird. Also present was Mark Maintain of the
South Lake Press.
OLD BUSINESS
Selection of Bond Underwriting Firm
City Manager Saunders explained that the purpose of the Speciai Meeting was to
select a Bond Underwriting firm for the proposed bond issue to fund the new sewage
treatment facility. He explained that Finance Director Van Zile and he interviewed
three of the firms that submitted proposais. They included William R. Hough and
CO., Prudentiai Securities, and A.G. Edwards. Mr. Van Zile offered his input as to
the firms and City Manager Saunders agreed that the William R. Hough Co. was the
recommended firm because of their extensive Florida underwriting, especially in the
area of water and sewer.
95-189
After discussion, a motion was made by Council Member Sargent,
.seconded by Council Member Dupee, and carried unanimously to select
the_firm of William R, Hough for the Ci~_ 's bond underwriter.
Treatment Plant Feasibility Report
The latest figures regarding the feasibility report for the bond issue for the treatment
plant were reviewed by City Manager Saunders. He explained that over a year ago
the Council directed the staff to move ahead with the design, permitting and financing
of a 1.5 million gailon sewage treatment plant. The staff and Council were working
with the best available information at that time which included several proposed
developments that were expecting to begin construction within a few months that
would result in a significant increase in the number of homes being built on the East
side of Clermont.
CITY OF CLERMONT
MINUTES
SPECIAL COUNCIL MEETING
OCTOBER 3, 1995
Page 2
City Manager Saunders explained that only two of those developments have actually
started construction which is Lennar Homes which has just broken ground within the
last week and North Ridge development which has just completed their infrastructure.
The other developments have either been postponed or have been dropped because of
the lack of development activity. Our financial consultants and our staff are hesitant
to recommend entering into a bond arrangement for the construction of a 1.5 million
gallon sewage treatment plant at this time. As has been explained in the past, in order
to fund the debt service for a 1.5 million gallon plant along with the other
improvements needed, a $11.5 million bond issue is required. We have been looking
at the possibility of a five-year bond anticipation note that would allow us to pay
interest only for five years before the note would be converted to a bond issue,
however, even during this five-year interest only period, we need to have a substantial
growth of approximately 250 homes per year in order to meet the debt service. In
addition to the new homes, a substantial increase in the monthly sewer rates would be
required, as well as the use of some reserves.
Due to the lack of development at this time and the uncertainty of new development,
City Manager Saunders explained that over the past few days they have worked with
City Engineer Springstead for an alternative that would still meet our obligations to
provide sewer service for developments which have already started or for which we
have an agreement.
City Engineer Springstead has recommended construction of a 750,000 gallon Davco
plant at a cost of approximately $650,000. This structure could later be converted to
a flow equalization tank for the 1.5 million gallon plant that we have been working
on. This plant would provide the sewer capacity to meet our obligations to Lennar
Homes and North Ridge which are currently under development and would also
provide capacity for several hundred more equivalent residential units. This would
not only significantly reduce the capital outlay resulting in a much lower debt service
for the next few years, but it would significantly reduce the risk the City would be
taking with the dependence on future growth. This would also allow time for
additional developments to commence while increasing our customer base.
CITY OF CLERMONT
MINUTES
SPECIAL COUNCIL MEETING
OCTOBER 3, 1995
Page 3
City Manager Saunders explained that if there were no objections, they would keep
working with this idea and present additional information to the Council within the
next couple of weeks. Council agreed that because of the current development
situation, it would be advisable to try to come up with an interim step and reduce the
City's risk.
There being no further business or discussion, the meeting adjourned at 6:30 p.m.
Attest:
Robert A. Pool, Mayor~...~
ph E. VanZ~ta'~e, City Clerk