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HomeMy WebLinkAbout2011-1109 Special City Commission MeetingSUMMARY MINUTES Special City Commission Meeting Wednesday, November 9, 2011, 3:00 p.m. City of Sunny Isles Beach, Florida A TTENTION ALL LOBBYISTS: CITY LAW REQUIRES YOUR REGISTRATION PRIOR TO ENGAGING IN LOBBYING ACTIVITIES BEFORE CITY STAFF, BOARDS, COMMITTEES OR THE CITY COMMISSION. PLEASE CONTACT THE CITY CLERK FOR FORMS AND ADDITIONAL INFORMATION. AGENDA 1. CALL TO ORDER / ROLL CALL OF MEMBERS The meeting was called to order by Mayor Edelcup at 3 :00 p.m. with the following officials present: Mayor Norman S. Edelcup Vice Mayor Lewis J. Thaler Commissioner Isaac Aelion Commissioner Jeanette Gatto Commissioner George "Bud" Scholl City Manager Alan J. Cohen City Attorney Hans Ottinot City Clerk Jane A. Hines, CMC Assistant City Attorney Fernando Amuchastegui 2. PLEDGE OF ALLEGIANCE Action: City Historian Richard C. Schulman led the Pledge of Allegiance to the flag. Mayor Edelcup gave opening remarks and noted that Item 4B regarding the Library Interlocal Agreement is being deferred to the November 17, 2011 City Commission meeting, and Item 4D is a Resolution removing the Use Restriction imposed on TDRs owned by Fort Apache Marina and is being added to the agenda. Vice Mayor Thaler moved and Commissiorier Scholl seconded a motion to approve the above changes to the agenda. The motion was approved by a voice vote of 5-0 in favor. 3. ORDINANCES FOR SECOND READING (Public Hearings) 3A. An Ordinance of the City Commission ofthe City of Sunny Isles Beach, Florida, Authorizing the Issuance of Not Exceeding $10 Million of Capital Improvement Revenue and Revenue Refunding Bonds of the City of Sunny Isles Beach, Florida; Approving a Loan Agreement in Respect of Said Bonds; Authorizing the Execution and Delivery of the Loan Agreement in Substantially the Same Form Attached Hereto as Exhibit "B"; Providing for Severability; Providing for Repealer; Providing for an Effective Date. (First Reading 1 0/20/11) Action: City Clerk Hines read the title, and Assistant City Manager/Finance MinaI Shah reported this ordinance allows the City to issue $10 Million in revenue bonds of which $7.575 Million will be used to refund existing bonds currently being paid at an interest rate of 5%. The new bond will be at 2.38% and we will recognize approximately $127,000 savings per year on the refunding, and for the life of that bond it would be a savings of $1.9 Million. The remaining proceeds will be used to fund the improvements to the parks as well as partial payment for the building of the municipal parking garage. Public Speakers: None Summary Minutes: Special City Commission Meeting November 9, 2011 Sunny Isles Beach, Florida Vice Mayor Thaler moved and Commissioner Gatto seconded a motion to adopt the ordinance. Ordinance No. 2011-375 was adopted by a roll call vote of 5-0 in favor. Vote: Commissioner Aelion yes Commissioner Gatto yes Commissioner Scholl ~ Vice Mayor Thaler ~ Mayor Edelcup yes 4. RESOLUTIONS 4A. A Resolution of the City Commission ofthe City of Sunny Isles Beach, Florida, Approving a Purchase Agreement between the City of Sunny Isles Beach and Dezer Development, LLC, and Weintraub Investments, LLC, in Substantially the Same Form as Exhibit "A", Attached Hereto, to Purchase Real Property from the City of Sunny Isles Beach Located at 18080 Collins Avenue; Authorizing the Mayor to Execute Said Agreement, Providing that Said Agreement is Reviewed for Legal Sufficiency by the City Attorney; Authorizing the City Manager and City Attorney to Do All Things Necessary to Effectuate this Resolution; Providing for an Effective Date. Action: City Clerk Hines read the title, and City Attorney Ottinot reported that the City was initially presented with two (2) competing Letters ofIntent from the Weintraub Investment and Dezer Development, and from Shefaor Development to purchase the property located at 18080 Collins Avenue, commonly known as the Alamo Site. On November 4,2011, he received a signed Purchase Agreement from Dezer and Weintraub, he received a Letter of Intent from Shefaor Development but did not provide a signed executed Purchase Agreement. As a result, the only party that has a signed executed Purchase Agreement is W eintraub/Dezer. City Attorney Ottinot said that the important terms of this Purchase Agreement are: the purchase price is $7 Million; the non-refundable deposit, in the initial Letter ofIntent it was $1 Million, in the revised Agreement it appears that at site plan only $200,000 is non- refundable and that is an issue that the Commission probably will want clarification on. Also, with respect to waivers, permit fees, and donation of TDRs, they have requested that we waive permit fees that the City imposes, not the fees imposed by outside agencies. That provision with respect to TDRs, they have requested 33,750 square feet ofTDRs, and there was one minor change in our initial discussion with Weintraub, those TDRs are tied with that site, if they are not used that those TDRs are returned to the City or voided, and that is something that also needs to be clarified. Another point, in the Purchase Agreement with respect to hazardous substances on the property, we had a provision to sell the property as is, that provision was deleted by the lawyers for Dezer and Weintraub. It imposed unlimited responsibility in terms of remediation. It is safe to say that we did conduct a Phase I environmental, no problem has arisen, obviously there is an above-ground gas tank because Alamo refuels cars on that site. In his original contract he had imposed a monetary cap of one percent ifthere needs to be remediation, ifthere is a problem then we need to have some kind oflanguage that says if we can't fix it, then that donation is revocable. Public Speakers: Cliff Schulman; A vi Weintraub; 2 Summary Minutes: Special City Commission Meeting November 9, 2011 Sunny Isles Beach, Florida Cliff Schulman, Esq. representing Weintruab Group, said we had basically indicated in our Letter of Intent (LOI), that "as proof of buyer solid intent to go forward with this project, buyer agrees that a portion ofthe earnest money deposited in the amount of$200,000 shall be deemed non-refundable upon execution of the purchase contract by both parties." The Agreement that we signed and provided to you is consistent with that. We also indicated in that LOI, the closing of the purchase agreement shall be contingent upon the seller terminating the existing lease between seller and Alamo Rent-A-Car, and providing us with an environmentally clean site at the sole expense of the seller, that again was in the LOI that we originally gave you. The agreement itself is now consistent with that. City Attorney Ottinot said to resolve it, and it is a pretty simple issue, in paragraph 2.1 if you delete the second sentence that should clarify the issue in respect to deposit in the purchase agreement. That second sentence is inconsistent with the entire language. Mr. Schulman went to that sentence and read "$200,000 shall be deemed non-refundable upon execution of the agreement by both parties." City Attorney Ottinot read "Buyers agree that a portion of the deposit in the amount of$200,000...." if you delete that, we are on the same page. Mr. Schulman said if you delete that, then you don't get the $200,000, why would you do that. City Attorney Ottinot said you agreed in your Letter of Intent $200,000 would be non- refundable prior to site plan, and if you go on and say, except for the $200,000 the deposit shall become non-refundable payment..., that sentence implies that upon site plan approval only $200,000. Mr. Schulman said then why don't you get rid of "except for the $200,000", and just say "the remainder of the deposit shall become non-refundable" and City Attorney Ottinot agreed. Mayor Edelcup said that would solve that issue. Mayor Edelcup said that you need also then to clarify the issue on the TDRs. City Attorney Ottinot said throughout negotiations with Weintraub, the City had made the position that the TDRs has to be used for that site and if that site plan is not approved or the project doesn't go forth, that donation is revocable. We just need to add that language, and Mr. Schulman said that they do not have any problem with that. Mayor Edelcup said the third issue would be the remediation problem. City Attorney Ottinot said that the third issue is basically the City would have the right to terminate if we cannot cure any remediation problem with the site. Mr. Schulman said then, and return the $200,000, and City Attorney Ottinot said yes, the full deposit will be refundable. We had a cap but your attorney deleted it, without the cap we would have a right to terminate but return the deposit. A vi Weintraub said that $70,000 is very small, we are talking about maybe 10%, and City Attorney Ottinot said that he had consulted our real estate lawyer prior to imposing the cap, in fact he had suggested 2% and the real estate lawyer said that was too much, you are talking about an above the ground tank, he said 1 % based on the number that we talked about. Mr. Weintraub said assuming it is not going to be that much, the thing is by the time we figure out that we have an issue, we are going to spend a lot of money, and he would rather that the City does the remediation and then we build the building. Mayor Edelcup said we spend an unlimited amount of money ifit gets to be a high number, higher than what the City wants, and it is up to you if you want to go through that remediation or not, and Mr. Schulman said let's assume, and his other practice is environmental, the City's reliability is 100% joint and sever liability, if a problem is discerned, you are going to spend that money one way or the other, in other words merely getting the property back, and Mayor Edelcup 3 Summary Minutes: Special City Commission Meeting November 9, 2011 Sunny Isles Beach, Florida said but if we did, then maybe the purchase price would change and we would try to sell it at another time because then it would be clean, you can't have it both ways. Mr. Schulman said okay, you are selling this property as is today purportedly in clean condition for $7 Million, if you return the property to a clean condition then the property is still worth $7 Million, and Mayor Edelcup said it may not be, maybe it would be worth $8 Million, all he is saying is that he is not going to put the City in a position where it would spend an additional million dollars just to pick a number, and then find out that we sold it for $6 Million and ifhe had fixed it and some other buyer came along and offered it to us and said it was worth $7 or 8 Million that he would be a fool not to have increased the purchase price to $8 Million, and so all he is saying is the fact that it is there at $7 Million. The City is willing to take some proportion of risk but not buy itself into a total unknown number and still have to proceed with the purchase or sale of the property is a burden that he really doesn't want to put on the City. City Attorney Ottinot said originally in the contract it indicates 1 % of the purchase pnce. Commissioner Scholl suggested we give them 30 days to look at the environmental condition of the property, and accept or reject, and that way they can get clarity and if they are doing that before they spend an inordinate amount of money on research and their plans. Weare both right in this issue but the fact is that he would rather put the burden back on them and let them make the decision. Mr. Schulman said that is fair. City Attorney Ottinot said yes, both parties 30 days, and Commissioner Scholl said for environmental only. Mayor Edelcup said the 1 % stays in, and City Attorney Ottinot said he has no problem with that. Mr. Schulman said okay, to write that into the contract. Commissioner Scholl said so basically if you walk it is environmental, deposit is refunded, and Mr. Schulman asked that the City provide them with a copy of the Environmental Phase 1. Vice Mayor Thaler said we are giving them 30 days to confirm the contract, and Commissioner Scholl said it is an 30-day environmental due diligence period, because if they have to shoot monitoring wells it takes a little bit of time. Mayor Edelcup said we can vote on this today with the added conditions. City Manager Cohen said if we are extending this 30-day period, we will also need to amend how the original $200,000 is handled because as it is structured right now, it is non-refundable after we sign this purchase agreement. Mr. Schulman said it would become non-refundable at the end of the 30-day period. City Attorney Ottinot read the three issues into the record: 1) Clarify that the $1 Million deposit is at risk after site plan approval; 2) Donation ofthe TDRs is voidable ifthe site plan is not approved or this contract does not go forward, and the TDRs can only be used for this site. 3) Remediation to allow the buyer to have 30 days to inspect the site to determine what kind of environmental issues there are and both parties have a right to either go forward or to terminate, and the provision of extending the time period to deposit $200,000. Mayor Edelcup said going back to the TDR issue, what he is trying to say is, whatever that number is can only be used on this site, if they use 15,000 of the 33,000 the other 18,000 is not transferable anywhere else. Mr. Schulman said in the 30-day period, either party can terminate, therefore it is their right to terminate, and City Attorney Ottinot said we have the right to cure it, and the Mayor had said 1%. Commissioner Scholl said let's be clear, they have the right to terminate if we don't want to cure and they don't want to cure ifthere is an environmental issue, and City Attorney Ottinot said that is correct. Mr. Schulman said correct, but it is their right to terminate. City Manager Cohen said in nuance of the 4 Summary Minutes: Special City Commission Meeting November 9, 2011 Sunny Isles Beach, Florida remainder of the $1 Million, and City Attorney Ottinot said under the proposed agreement, they are required to deposit $1 Million within five (5) days of approval of this contract. Based on the agreement that we allowed them 30 days for inspection, we can move that requirement to after inspection, and Mr. Schulman agreed. Vice Mayor Thaler moved and Commissioner Aelion seconded a motion to approve the resolution, as amended. Resolution No. 2011-1795 was adopted by a roll call vote of5-0 in favor. Vote: Commissioner Aelion Commissioner Gatto Commissioner Scholl Vice Mayor Thaler Mayor Edelcup yes yes ~ yes yes 4B. A Resolution of the City Commission of the City of Sunny Isles Beach, Florida, Approving the Third Amendment to Library Interlocal Lease Agreement with Miami-Dade County, in Substantially the Same Form as Attached Exhibit "A", Superceding All Prior Library Interlocal Lease Agreements; Authorizing the Mayor to Execute Said Agreement; Authorizing the City Manager and City Attorney to Do All Things Necessary to Effectuate this Resolution; Providing for an Effective Date. Action: Deferred. [City Clerks Note: See additional action at the beginning of the meeting.} 4C. A Resolution ofthe City Commission of the City of Sunny Isles Beach, Florida, Approving the Purchase of Builders Risk Insurance for the Sunny Isles Beach/Newport Pier and Restaurant, through the City's Insurance Broker, Brown & Brown Insurance, Inc., in an tfle Amount Not to Exceed ef $108,578.96, for a One- Y ear Term; Authorizing the City Manager to Do All Things Necessary to Effectuate this Resolution; Providing for an Effective Date. Action: City Clerk Hines read the title, and City Manager Cohen reported that we have to procure Builders Risk Insurance per the construction of the Pier, and that Bob Hollander is here from Brown & Brown if there are any questions regarding the policy itself. This is a reduction of what we were originally quoted due to the fact that we are not spanning two hurricane seasons as we were originally. Public Speakers: Bob Hollander Commissioner Aelion said that he had understood that mobilization had occurred at the Pier for a certain period and so this insurance was in place already, and City Manager Cohen said no, the mobilization was for demolition only and it is not required for that. Mayor Edelcup asked if we even need it yet as we are not ready for construction since we don't have the permit yet. Why are we buying the insurance now, the clock is starting to tick, and the money is starting to go out, and City Manager Cohen said what he would like is authorization to purchase this insurance when we want to start construction of the project. It makes no sense to purchase this today when we don't have the final permit to start. Mayor Edelcup asked if the rate goes down or does the year get extended, in other words, what are we buying? Bob Hollander said it is for 12-months, the time of the construction period is intended to be a little less than that but it is a 12-month policy, it is a full term policy, 5 Summary Minutes: Special City Commission Meeting November 9, 2011 Sunny Isles Beach, Florida builders risk are fully termed so that they can't be cancelled or prorated but he agrees as to whatever the appropriate time is. It was a rather difficult policy to try and obtain, they actually went to 13 different insurance carriers and most of them declined totally but we were able to get a quote to cover this project. Vice Mayor Thaler said this may again fall into the two hurricane seasons by the time we get this thing, what are we gaining by approving this now, and Commissioner Scholl said if we got the permit tomorrow and the demo got done, staff needs the ability to bind the policy, and so we are going to need it at some point but we are just giving staff the authority to bind it when it is necessary. Commissioner Aelion said he does not agree because as noted by the Vice Mayor and by the Mayor that this can be a valuable amount depending on circumstances beyond our control, and so he doesn't think an amount should be voted upon today. Mayor Edelcup asked if we can create a resolution today that is effective for the next 30 days, so we can give the Manager the authority between Commission meetings to do this. City Attorney Ottinot said the Resolutionjust expresses the Commission and you can put any conditions you want on it, that one is not precluded by law. City Manager Cohen said he had spoken with Mr. Hollander and the rate will not be going down regardless ofthe time frame, it can only go up. Weare asking for this dollar amount so that we are not going to be overspending, we might have to come back to the Commission if this gets dragged out and the rate is impacted. The point is if we get the permit approved within a reasonable period of time, then we can start mobilizing immediately. If you are going to vote on it today, then he would say to do it for 40 days because the next Commission meeting is actually 40 days from now. Commissioner Aelion said if the City Manager believes that this is the minimum threshold and it won't go down but only up, then he would ask Brown and Brown if this amount can be locked in for an amount of time that according to the City Manager is feasible. Mr. Hollander said the insurance underwriters can be difficult about extending dates, we have done that a few times because of various issues like turtle eggs, they always say to him that we need to extend the proposal to a certain date, they give us a deadline usually, and he wants to make sure that when the proper time comes that the permit is issued, the coverage is effective, and there will not be an increase in the premium, and so he wants to be able to get back to his underwriter and tell them that he was at the Commission meeting and it has been delayed for 30-45 days so that we can at least have communication with them. Commissioner Scholl said he doesn't think we need to delay it, we can just give staff the authority to bind it in the next 40 days, and if they don't bind it in 40 days then it comes to the next meeting. Mayor Edelcup said that the Manager is saying that he is not going to move forward until he has the permit, and we are saying that we want to lock in the rate but we don't want to buy the insurance until we know that we need it, and we don't know when we are going to start needing it, and so the only way we can accommodate that is to take it down the line that this Commission will give the Manager the authority to buy that insurance at $108,578.96 as long as it is still available when he is able to buy it. We can handle it that way in the resolution and then you don't have to come back, we can set a limit of no greater than $108,578.96 and no less than one year of coverage, the resolution has a sunset date of a year from now just in case we haven't moved forward and we get the opportunity to revisit it. Commissioner Scholl moved and Commissioner Aelion seconded a motion to approve the resolution, as amended. Resolution No. 2011-1796 was adopted by a voice vote of5-0 in favor. 6 Summary Minutes: Special City Commission Meeting November 9, 2011 Sunny Isles Beach, Florida 4D. Add-On: A Resolution of the City Commission of the City of Sunny Isles Beach, Florida, Removing the Use Restriction Imposed on the Transfer of Development Rights ("TDRs") Owned by Fort Apache Marina, LLC ("Fort Apache"); Providing for a Transfer Fee; Providing the City Manager with the Authority to Do All Things Necessary to Effectuate this Resolution; Providing for an Effective Date. I I I , I I Action: [City Clerks Note: Added to Agenda, see additional action at the beginning of the meeting.} City Clerk Hines read the title, and City Attorney Ottinot reported that in 2005 the City created a Transfer of Development Rights Sub-Bank account for Fort Apache Marina, and that Sub-Bank currently has 34,485 square feet and 19 units of TDRs, however, the TDRs owned by Fort Apache are currently being used in strict conformity with an approved site plan on the west side of Collins Avenue. The City desires to remove the use restrictions imposed on the TDRs owned by Fort Apache, provided that a transfer fee is paid to the City. As a condition precedent of deleting the use restriction set forth in the Resolutions, Fort Apache shall pay the City a minimum fee of $15 per square foot from the total amount of TDRs owned by Fort Apache. The transfer fee in this case shall be $517,275 based on the ownership of 34,485 square feet of TDRs. The minimum fee is based on the current economic conditions of current real estate market for development of new properties. The City reserves the right to change the minimum fee. Public Speakers: Fred Shonard Fred Shonard, owner of Fort Apache Marina, said he agrees with the transfer fee, and he has a written document with the Dezer Group that he is going to give to the City 19 TDRs and each one is 1,815 square feet and it comes to 34,485 square feet, $517,275 and he agrees to pay that to the City on conclusion with the Dezer Group. Commissioner Scholl asked if we are setting a precedent, and Mayor Edelcup said probably, but it is only precedent for TDRs that were issued in the Bellagio case, everyone else is unrestricted. City Attorney Ottinot said there is only one current owner, this resolution and if Fort Apache sells, it is 34,000 to Dezer Development, you will only have one owner of the remainder amount which is Epicure, and he doesn't think there are any other bank accounts related to those TDRs any more. Vice Mayor Thaler moved and Commissioner Scholl seconded a motion to approve the resolution. Resolution No. 2011-1797 was adopted by a voice vote of 5-0 in favor. 5. ADJOURNMENT Mayor Edelcup adjourned the meeting at 3:33 p.m. Respectfully submitted by: Approved by the City Commission on Dec. 15,2011 ., (tf~~ ~~,~~ Jane A". Hines, CMC, City Clerk - ,'~ ,._ - ~ 'I , .. 7 Preview TO: FROM: DATE: RE: Page 1 of 1 City of Sunny Isles Beach 18070 Collins Avenue Sunny Isles Beach, Florida 33160 (305) 947-0606 City Hall (305) 949-3113 Fax MEMORANDUM The Honorable Mayor and City Commission Jane A. Hines, CMC, City Clerk 12/15/2011 Summary Minutes for the November 9, 2011 Special City Commission Meeting RECOMMENDA TION: Attached for your consideration are the Summary Minutes for the November 9, 2011 Special City Commission Meeting. REASONS: . ATTACHMENTS: Summary Minutes http://sibagenda.sibfl.net/agendalPreview.aspx?I temID=649&MeetingID=0&MeetingDat... 11/28/2011