MINUTES OF MEETING

NORTH SPRINGS IMPROVEMENT DISTRICT

 

            The regular meeting of the Board of Supervisors of the North Springs Improvement District was held on Wednesday, October 11, 2006 at 4:30 p.m. at the District Offices, 10300 N.W. 11th Manor, Coral Springs, Florida. 

 

            Present and constituting a quorum were:

 

            Salvatore Mendolia                                           President

            Steve Mendelson                                              Secretary

 

            Also present were:

 

            John Petty                                                        Manager

            Dennis Lyles                                                     Attorney

            Jane Early                                                         Engineer

            Denise Ganz                                                     Ruden McClosky

            Fernanda Haido                                                Prager, Sealy & Co. (Via Telephone)

            Jean M. Rugg                                                   Severn Trent Services

            Janice Larned                                                   Severn Trent Services

                                                                                               

FIRST ORDER OF BUSINESS                               Roll Call

            Mr. Mendolia called the meeting to order and Mr. Petty called the roll.

 

SECOND ORDER OF BUSINESS                          Approval of the Minutes of the September 13, 2006 Meeting

            Mr. Petty stated each Board member received a copy of the minutes of the September 13, 2006 meeting and requested any corrections, additions or deletions.

            There not being any,

 

On MOTION by Mr. Mendolia seconded by Mr. Mendelson with all in favor the minutes of the September 13, 2006 meeting were approved.

 

TENTH ORDER OF BUSINESS                             Staff Reports

            A.        Manager’s Report

            Mr. Petty stated we have news from our underwriter regarding the pricing of our bonds.  The pricing for these bonds, which are supposed to close tomorrow, came in better than what we discussed.  Our underwriter wants to give us the good news and discuss the sale.  When we get her back on the line, we will come back to this.

THIRD ORDER OF BUSINESS                             Consideration of Resolutions

            A.        Resolution 2007-1 Designating John Petty Assistant Treasurer and Assistant Secretary

            Mr. Petty stated this is a housekeeping clean up matter because Mr. Goscicki is no longer in this position.  I will be able to back up Ms. Larned in the signing of checks as well as paperwork for the District. 

            Mr. Mendolia asked did we discuss this or have a meeting regarding this before?

            Mr. Petty responded no sir.  This is the first time it is coming to you.  You currently have Mr. Goscicki as Assistant Treasurer and Assistant Secretary.  He is with Severn Trent Services and was the acting manager for a period of time.  We want to do this as a housekeeping issue because I have been the manager for approximately a year.

 

On MOTION by Mr. Mendelson seconded by Mr. Mendolia with all in favor Resolution 2007-1 designating Mr. Petty as Assistant Treasurer and Assistant Secretary was adopted.

           

            B.        Resolution 2007-2 Designating Signatories

            Mr. Petty stated this item is a duplication of A and we would like to pull it from the agenda.

            Mr. Mendolia asked is it done under the same circumstances?

            Mr. Petty responded yes.

 

FOURTH ORDER OF BUSINESS                          Consideration of Chemical Bids for Aquatic Weed Control

            Mr. Petty stated every year we go out to bid on the chemicals we use for our aquatic plants.  You have a summary of this.  We are asking for approval to award this to the lowest responsive bidder in each category.  We take the best prices for each chemical and award to that supplier.  It has been reviewed by staff and recommended by your manager.  Is it in the agenda package?

            Ms. Rugg responded no.  The bid tabulation started at 11:00 a.m.

            Mr. Petty asked did you open the bid tabulations?

            Ms. Rugg responded I opened the bid tabulation.  We have one issue.  From what we could ascertain, a sealed bid arrived after 11:00 a.m.  I still have it, unsealed, in my hand.  We did not open or consider it as part of the bid tabulation.  I did not know if the attorney wanted to.

            Mr. Lyles stated let me give you a couple of issues you have to deal with.  Depending upon the circumstance under which it arrived, this is a minor technical irregularity the Board can waive.  At what time did the sealed bid arrive?

            Ms. Rugg responded it arrived at my office after 1:00 p.m.

            Mr. Lyles asked at what time did it arrive here?

            Ms. Rugg responded I do not know.

            Mr. Petty stated it came in late and was not in the package for your consideration.  Staff has not had a chance to evaluate the impact of all the bids because we just opened it today.  Let us place this on next month’s agenda.

            Mr. Lyles stated in order to consider it, because it arrived late, the Board has to make the determination that it was a minor irregularity.

            Mr. Petty stated I am not asking the Board to consider opening this letter.  I am asking the Board to wait until next month when we come to you with a clear bid tabulation, which staff has evaluated properly.

            Mr. Mendolia asked are we going to consider the late bid next month?

            Mr. Petty responded I do not want to ask the Board for anything or to specify what our actions will be until I am able to talk to staff and find out if it is a material bid we are considering opening late.  I am not ready to make a recommendation to the Board.

            Mr. Mendolia asked can we afford to wait a month to make this decision?

            Mr. Petty responded yes.  We have enough chemicals at the moment.

            Mr. Lyles asked is it your intention to potentially consider this late bid, which has not been unsealed?

            Mr. Petty responded I do not know until I talk to my staff.

            Mr. Lyles stated that is not my question.  If we are even going to open it to determine whether or not it is potentially the low responsive bid, we need the Board to authorize it to be opened late based on the circumstances under which it arrived.

            Mr. Petty stated I am not asking for Board approval on this.  I thought I made it clear.

            Mr. Lyles asked do you not want to consider it?

            Mr. Petty responded I am not asking for approval to open the letter at this time.  I am asking for the Board to hold this item on the agenda until next month’s meeting.

            Mr. Lyles stated we will be in the same position.

            Mr. Petty stated no sir.  I do not think we will.

            Mr. Mendolia stated it is still going to be late whether it is now or then.

            Mr. Mendelson stated yes.  It is a late bid.

            Mr. Petty stated the option to re-bid is open to us.

            Mr. Mendolia asked why are we so concerned with just one bid that came late.  Do we have enough bids?  Let us do what we have.  Why wait?

            Mr. Lyles responded it is a Board judgment call.  If you believe the bidding process was not affected by this late bid, which was somewhere from one minute and two hours late, we are not sure how far into the two hours it arrived at the District facilities, but if it is your decision it is a minor irregularity and it did not affect the bidding process, it has not been opened and this proposed bidder did not have the opportunity to view what the other bids had, you can waive this as a minor irregularity and staff can take it into account.  If you do not want to consider it because of the passage of time and this person had an opportunity to quickly put together a proposal, slip it in here and beat the other proposals, you do not waive it.  You can also reject the whole thing and let staff re-bid it because of the irregularity.  I do not believe staff can open the late bid and then come to the Board.  You need to authorize staff to open the late bid if it is what you want to do.

            Mr. Petty stated let me add the option of no action by the Board today.  Let this be on next months agenda without authorizing staff to open the unsealed bid or authorizing staff to award the bid.  You can defer it until next month’s schedule.  Speaking for staff, we are not in the position to tell you these numbers did not leave this building. 

            Mr. Lyles stated then you are not in a position.  This should make your decision.  If we cannot have the assurance from staff, we will have to wait to open it a month from now.

            Mr. Mendolia stated we will do it this way.

 

FIFTH ORDER OF BUSINESS                               Consideration of Engagement Letter with Berger, Toombs, Elam, Gaines & Frank to Perform the Financial Audit for Fiscal Year Ending September 30, 2006

            Mr. Petty stated we struck a theme when we talked about things, which will be deferred until next month.  This was increased by $12,000 from last year.  We are not happy with this audit firm and their submittal.  We wanted to show you what they submitted.  We would like to talk to them and see if we can get the price closer to the $20,000 figure they previously had.

            Mr. Mendolia stated I believe we talked about this one time.

            Mr. Petty stated the audit came in later than what we like this year under understandable reasons.  It has been difficult for every auditor we work with throughout our company.  Almost all of them have been late this year due to personnel issues in this area.  It is difficult to keep working class people here as the price of homes gets out of control.

            Mr. Mendolia stated we will defer it until next month.

 

SIXTH ORDER OF BUSINESS                              Consideration of Work Authorizations

            A.        Work Authorization 149 (Addendum) – Heron Bay North Plat #3 Spine Road W/S and LS TPC #14 – ESDC

            Ms. Early stated this is a housekeeping item.  I did not get it on the agenda last month.  We awarded the contract for this work.  This is our work authorization for inspections.  It is in the Heron Bay North Plat #3 area.  The contract was approved by the District and is underway.  This is a clean up of our work authorization. 

 

On MOTION by Mr. Mendelson seconded by Mr. Mendolia with all in favor Work Authorization 149 (Addendum) was approved.

 

TENTH ORDER OF BUSINESS                             Staff Reports (Continued)

            A.        Manager’s Report (Continued)

            Mr. Petty stated we would like to bring the bond pricing up for discussion.  We have our bond counsel present and Ms. Haido is on the phone. 

            Ms. Haido stated I have excellent news.  We are pleased with the way the pricing of the Heron Bay 2006 Bonds went this morning.  Before I tell you the rates and the par amounts we were able to achieve, I want to make sure it is clear we priced the bonds within the parameters included in the delegation resolution approved by the Board in the August meeting. 

            In terms of interest rates on the long term bonds, we achieved a 5.20% rate with a slight discount of 99.75% and a yield of 5.22%.  This is with a maturity of May, 2027.  The B Bonds have a May, 2014 maturity.  We were able to achieve a 5% par.  As we represented to the Board before, we are sizing both as long term bonds and short term bonds on the revenue on the assessment levels, which were approved and kept by the Board.  The lower the interest rate is, the higher the par amount of the bond.

            We were able to get a par amount of $6,930,000 in the A Bond and a par amount of $2,165,000 for the B Bonds.  The total is $9,095,000.  Because we had a higher par amount, we generated more construction proceeds than we originally anticipated.  The total generated in construction proceeds is approximately $7,728,024.  The last set of numbers we presented to you included a long term interest rate of 6% and a short term interest rate of 5.5%, which generated a par amount of $8.4 Million and construction proceeds of $6.9 Million. 

            With the low interest rate we were able to achieve today, we generated almost $1 Million more in construction proceeds.  We are excited about this.  We were able to generate more in construction proceeds based on the same assessment levels.  This is a reflection of the great credit of the District as well as the Heron Bay project.  I also have to give some credit to my firm for all their hard work and their relationship with the lenders.  The bonds will close on October 24, 2006.

            Ms. Ganz stated pursuant to the authority of the resolution adopted on August 9, 2006, authority has been delegated to the President of the District to sign the bond purchase contract with Prager, Sealy and Company, which reflects these terms and conditions.  The bond pricing is within the parameters approved in the resolution delegating the authority to the President.  We will put together the bond purchase agreement tonight.  The working group will review it and it will be executed effective as of tomorrow.

            Mr. Lyles stated my firm and I have been involved in every step of this on your behalf.  Everything you heard from the underwriter and bond counsel has been part of an ongoing process we have been part of.  We received a good deal on the market.  It is time to pull the trigger on this.  Based on the previous authority of the resolution and the other actions you have taken, we will have these documents ready for the President to sign.  The reason why we wanted to make a full presentation with all the numbers at this meeting is so you know we are not plugging in these numbers in some of the documents.  You will see some of the documents have blanks where these numbers will go.  We are here to represent to you all the numbers and terms outlined are what will be going in the final documents we are putting together.  We have a pre-closing scheduled for October 20, 2006 where the final documents will be executed and funding will be a few days later.

 

SIXTH ORDER OF BUSINESS                              Consideration of Work Authorizations (Continued)

            B.        Work Authorization 168 – County Line Road Extension

            Ms. Early stated this is for the last extension of County Line Road.  We currently have it designed to the FPL substation.  This portion of County Line Road West will continue to the limits of Heron Bay North Plat 3.  This is one of the projects within this bond being sold.  The money for the design and construction is within the bond.

 

On MOTION by Mr. Mendelson seconded by Mr. Mendolia with all in favor Work Authorization 168 was approved.

 

SEVENTH ORDER OF BUSINESS                        Consideration of Permit for Parkland Golf and Country Club Golf Club Facility

            Ms. Early stated this is our standard surface water permit for the last portion of the golf club in Parkland Golf and Country Club.  There is a recommendation letter in the package.  You have the typical standard conditions attached.  We recommend approval of the permit.

            Mr. Mendolia asked who is taking care of the finances on this?

            Ms. Early responded WCI Communities, Inc.

 

On MOTION by Mr. Mendelson seconded by Mr. Mendolia with all in favor the permit for Parkland Golf and Country Club Golf Club Facility was approved.

 

EIGHTH ORDER OF BUSINESS                           Consideration of Conveyances

            A.        Lake Maintenance Access Easements for Parkland Golf and Country Club

            Mr. Petty stated this has been reviewed by our engineer as well as Mr. Schooley.  As we have taken on these water management facilities and subdivisions, the easements have not followed.  It is appropriate we clean this up.  We are working with WCI Communities, Inc. to do this.  I will defer to Ms. Early because I believe there is one she wants to pull for consideration.

            Ms. Early stated we recommend approval of one through nine with the exception of number five.  It is only showing an 8’ easement and we need a minimum of 12’.  WCI is reworking it. 

 

On MOTION by Mr. Mendolia seconded by Mr. Mendelson with all in favor lake maintenance access easements for Parkland Golf and Country Club number one through four and six through nine were approved.

 

            B.        University Drive and Trails End

            Mr. Lyles stated this is a matter, which came before you in September of 2004.  At the time you approved execution of a series of deeds regarding construction of University Drive and Trails End.  It was going to be deeded to the City of Parkland.  It was determined work needed to be done on the roadways and right-of-ways.  Parkland did not accept them at the time.  In the intervening two years, the work has been completed and it has been accepted by the engineer.  It is ready to go back to the city.  Because your action and the deeds signed in 2004 are stale, WCI Communities, Inc. is requesting they be re-signed so they have current dates.  The Descriptions and the purposes of the right-of-ways, construction and everything is the same in terms of our action.  The work needing to be done has been completed.  The City is ready to accept this conveyance from NSID to Parkland.  We need a motion to authorize re-execution of the University Drive and Trails End deeds.

 

On MOTION by Mr. Mendolia seconded by Mr. Mendelson with all in favor the re-execution of the University Drive and Trails End deeds were approved.

 

NINTH ORDER OF BUSINESS                             Consideration of Modification to County Line Road Deed

            Mr. Lyles stated we previously were granted a right-of-way by WCI Communities, Inc. along County Line Road.  The right-of-way granted to NSID was limited for use as a dike and related uses.  One of the things current planning indicates will be necessary for the right-of-way is road construction.  Since the original grant was limited to dike, water management and stormwater control purposes, we need to have an expansion of the authority given to the District by the original deed.  As a result of this document NSID will receive the right to build and maintain roads as well as the original rights you obtained under the original deed.  We need a motion to accept modification of the covenant on the County Line Road Deed to include roadway purposes.

 

On MOTION by Mr. Mendolia seconded by Mr. Mendelson with all in favor modification to the County Line Road Deed was approved.

 

TENTH ORDER OF BUSINESS                             Staff Reports

            A.        Manager’s Report

            Mr. Petty stated the first item I have is consideration of the financial audit for fiscal year 2005.  The reason for it being late has been described to you as a problem persisting in Broward County.  We are feeling this across the Board with all our districts.  This is coming to you later than expected because there were several typographical corrections we wanted to make to it.  It took Berger, Toombs, Elam, Gaines and Frank a couple of days to do and we were unable to include them in the agenda package.  This is a clean audit.  We are proud to bring it to the Board for consideration.  We will be submitting this upon acceptance to the Attorney General as well as other state entities. 

            Mr. Mendolia asked have you seen it?

            Mr. Lyles responded no.  We did not get it in time for the meeting.  Mr. Petty needs to transmit this.  You have the summary highlighted in the management letter at the end.  From everything I am hearing, it is a clean audit.  You did not meet the threshold for a state of financial emergency.  If your timing is such you need an acceptance today, you can accept the audit and any questions can be brought up at the next meeting.  There can be an addendum if something needs to be added. 

            Mr. Petty stated I am under no time constraints.  I can ask for an extension on the reporting requirement.

            Mr. Mendolia stated I like what Mr. Lyles said. 

 

On MOTION by Mr. Mendolia seconded by Mr. Mendelson with all in favor the financial audit for fiscal year 2005 was accepted.

 

            Mr. Petty stated the next item is part of the PR issues we discussed as a possibility of working with our residents to have a better understanding of what the District does.  Part of this is communicating with them on work being done at The Commons.  The PR firm suggested we do a public service announcement.  It will talk to them about the hard work done by field personnel during times of storm events.  We can put it on the local cable channel.  It will be on video.  The cost to do it will be between $5,000 to $7,000.  We feel it is an economical way to talk to the residents.  Doing a newsletter can cost the same amount in postage.  We would like to recommend this to the Board for consideration.  We do not need action today, but the PR firm is ready to go forward.

            Mr. Mendolia stated we will save it for next month’s meeting.

            Mr. Petty stated the next item is to talk to you about the bonds you just approved as well as the past bonds we have gone through.  Staff is preparing schedules along with the engineer and developer to quantify what you purchased in hard fixed assets.  You have agreements from the developer to finish the development.  The total construction costs will exceed our bond amount.  Staff is accounting for this so the Board is aware of what you purchased, what is left for WCI Communities, Inc. to contribute and what is outstanding. 

            You asked for a better explanation of the funding agreements and other items of concern.  We talked to you about coming up with a different schedule where it is a CPI format.  Now that we issued the bonds we feel this may be more appropriate.  We will have this starting at the next meeting.

           

            B.        Attorney’s Report

            Ms. Early stated we talked about this on at least two previous occasions.  I told you our deadline for submitting our proposal to the legislative delegation to amend the special act giving the District its powers is due by October 20, 2006.  I passed out a draft of the proposal we will submit in writing on your behalf.  We have an additional area you will hear about from Ms. Larned.  We provided for the Board, on its vote, to transfer the method of electing Supervisors from a one acre, one vote process to a one voter, one vote process. 

            We address the issue of compensation of Board members on page two.  You have been underpaid for some years.  Other special districts we surveyed are at the $400 per month level.  We are adding language to provide for the first raise in over 30 years to $400 per month, which is more appropriate in light of what other districts’ board members are receiving.  We are also providing for travel expenses, if you incur anything on District business. 

            The other area you identified you were interested in, along with the engineer and District manager, is on the bottom of page two; contracts for goods, supplies and materials purchased will be subject to the same bidding thresholds as other state and local government agencies of Florida.  Instead of $4,000, it will go up to $150,000 in many cases.  We will still follow the Consultants Competitive Negotiation Act, which appears on page three.  When you are hiring engineers, architects, landscape architects and surveyors, you have to go through a notice as well as an evaluation ranking proposal process.  Maintenance surveys will be set at what is called Category 4.  It is something the state sets the increases for.  It is currently set at $150,000.  They may increase it in the future to $200,000 if inflation and other factors apply. 

            All of these things we are talking about are going to save the District a noticeable amount of money by not having to publish newspaper advertisements as well as not involving the District’s engineer’s and legal staff to get bid packages together.  There is one other area Ms. Larned is going to mention regarding the potential for us to go to a bank for a short term type financing as opposed to a big bond issue.  She will describe it to you and if you agree, we will add it to the package we are submitting to legislature.  At the end of this I will ask that you take up a motion authorizing this to be filed on behalf of the District.

            Ms. Larned stated in the last few months we observed some of our districts need financing from time to time, which is not always attractive in a long term form.  Their options have become limited by using the current cash on hand or going out to sale bonds.  We have been able to establish relationships with our banks and other potential lenders, which may be able to fill the gap of short term bonds.  We would like the Boards consideration to include in this bill the authority to proceed with any kind of short term mechanism up to and including bank loans.

            Mr. Mendolia stated it will save time and money.  I agree.

            Mr. Lyles stated with this addition to the proposed bill before you, a motion authorizing staff to submit to the Broward County Legislative Delegation the proposed set of amendments to Chapter 2005-341, Laws of Florida, is appropriate at this time.

 

On MOTION by Mr. Mendolia seconded by Mr. Mendelson with all in favor staff was authorized to submit to the Broward County Legislative Delegation the proposed set of amendments to Chapter 2005-341, Laws of Florida.

 

            C.        Engineer’s Report – Heron Bay Clubhouse

            Mr. Petty stated I asked the engineer to pull the item called Heron Bay Clubhouse roof tile.  Although this body is capable of picking out a roof tile, we feel it is something we can handle in house.

            Mr. Mendolia stated I take this as an insult.  I agree you can handle it.  I can handle it too, but I will not do it. 

            Mr. Petty stated I may have misspoken.

            Mr. Mendolia stated you should leave it to the engineer.  They can handle it well. 

            Ms. Early stated with regard to the clubhouse, I spoke to Ms. Smith today.  She is pleased with the progress.  They started approximately two weeks ago.  They are almost complete with the second floor painting.  Once the second floor is finished they will start on the first floor, which is due Monday.  The pool contractor started draining the pool this past Monday.  He came across broken tiles under the coping, which I spoke to Mr. Petty about.  His work is scheduled to be done in two weeks.

            Mr. Mendolia asked who is the pool contractor?

            Ms. Early responded I do not know who the subcontractor is, but I can find out for you.

            Mr. Mendolia stated that is alright.

            Ms. Early stated the pool contractor found 43 cracked or loose tiles under the coping and eight pieces of loose coping.  The hand rail in the spa needs to be replaced.  The architect did not include for the spa to be diamond bright along with the pool.  The pool contractor is saying it will not match.  He submitted it and wanted to know what we want to do.  I spoke to Mr. Petty and we all agree we should do the diamond bright in the spa as well.  To replace the broken tiles, the coping, the hand rail and to do the diamond bright, it will be a change order of $8,000.

            Mr. Mendelson asked what is the timeframe on this?

            Ms. Early responded they are currently working on the pool so it will be the same, two weeks.

            Mr. Petty stated we asked him to look at items needing repair.  The spa is structurally fine.  It is an aesthetic issue, which came up.

            Mr. Mendolia asked where is the money coming from?

            Mr. Petty responded from us. 

            Mr. Mendolia asked do we have enough money?

            Mr. Petty responded yes sir, we do.  Ms. Early’s husband is going after the insurance company.

            Ms. Early stated he met with the insurance adjuster on October 4, 2006.  They both went on the roof and they agree $20,000 is not enough to repair the roof.  My husband told him it was under contract with the District to replace the roof.  Once the contracts are signed I can give him a copy to show to the insurance company what the estimate is for the roof.  We should be able to wrap this up in the next week.

            Mr. Mendolia asked are we getting more money from the insurance company?

            Ms. Early responded yes.  I believe he is trying to get $220,000 for the clubhouse.

            Mr. Mendolia asked what is the total we received?

            Ms. Early responded they only gave us $20,000 for the roof, which Mr. Petty did not accept.

            Mr. Petty stated the most being proposed by our insurance carrier was less than $40,000 for everything.

 

On MOTION by Mr. Mendolia seconded by Mr. Mendelson with all in favor a Change Order No. 1 for clubhouse repairs at Heron Bay Commons with a net increase of $8,000 was approved.

 

            Ms. Early stated in regard to the tennis courts, the architect is due to submit to the City of Coral Springs the RC review by the end of this week or the beginning of next week.  Once they approve the site plan, we will put it out to bid.

 

ELEVENTH ORDER OF BUSINESS                     Approval of Requisitions and Invoices

           

On MOTION by Mr. Mendolia seconded by Mr. Mendelson with all in favor the requisitions and invoices were approved.

 

TWELFTH ORDER OF BUSINESS                       Supervisor’s Request and Audience Comments

            There not being any, the next item followed.

 

THIRTEENTH ORDER OF BUSINESS                Adjournment

            Mr. Lyles stated with the closing coming up, we suggest the last regular meeting of the Board be recessed rather than adjourned in case we need to take action on an item at the last minute in connection with the bond transaction.  We typically announce the meeting is being recessed to the day of the pre-closing or the day before.  The day before will be Thursday, October 19, 2006.  It is doubtful we will need to reconvene, but we recommend recessing this meeting until 4:30 p.m. on October 19, 2006 at this location.

 

On MOTION by Mr. Mendelson seconded by Mr. Mendolia with all in favor the meeting was recessed to Thursday, October 19, 2006 at 4:30 p.m. at the District Offices.

 

 

 

 

                                                                        

 Steve Mendelson                                                            Salvatore Mendolia

 Secretary                                                                        President