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092611 exec session2011-681 CITY COMMISSION MINUTES September 26, 2011 EXECUTIVE SESSION PUBLIC NOTICE TO WHOM IT MAY CONCERN: Please be advised that the City Commission of the City of Sanford will meet in a regular session and an attorney - client session on September 26, 2011, at 6:00 p.m., in the Railroad Conference Room located on the Second Floor of Sanford City Hall, 300 North Park Avenue, Sanford, Florida. The attorney - client session will last approximately one - half hour. The agenda for the meeting follows: AGENDA CALL TO ORDER/ROLL CALL ORDER OF BUSINESS 1. Public Briefing. Public briefing of City Commission relative to Maece Taylor, Inc. agreement, as modified, and history of the matters relating thereto. 2. Request of City Attorney. The City Attorney, in conjunction with Special Legal Counsel, requested an attorney - client session with the City Commission in accordance with the provisions of Section 286.011 (8), Florida Statutes, to discuss pending litigation filed against the City said litigation files and styled as follows: Maece Taylor, Inc. v. City of Sanford, Florida (Case No. 11 -CA- 3445 -15 -L) with jurisdiction residing in the 18th Judicial Circuit Court, Seminole County, Florida. 3. Attendees of the Attorney - Client Session: City Commission; City Manager Norton Bonaparte; City Attorney William Colbert; Special Legal Counsel Bill Lawton, Esquire, and John M. Joyce of the Dean Ringers, Morgan & Lawton, P.A. law firm; and a duly authorized court reporter. The certified court reporter will be present to ensure that the attorney - client session is fully transcribed and that the transcript will be made. 4. Begin Attorney - Client Session. Discussion of litigation. Likely to be about one -half hour in duration. 5. End Attorney - Client Session. Public discussion by City Commission, if desired. 11 Page 6. Adjournment. Although no decision will be made that is subject of appeal during the course of the training, all persons are hereby advised that, pursuant to Section 286.0105, Florida Statutes, any person desiring to appeal any decision will need a record of the proceedings and may need to ensure that a verbatim record of the proceedings is made which includes the testimony and evidence upon which the appeal is to be based. A transcript will be provided by the City of Sanford as required by law, but a record will not otherwise be provided. In accordance with the Americans with Disabilities Act, persons with disabilities needing assistance to participate in any of these proceedings should contact the City Clerk at 407.688.5010 in advance of the meeting. 21Page 2011-682 CITY COMMISSION MINUTES September 26, 2011 EXECUTIVE SESSION The City Commission of the City of Sanford, Florida, met in Executive Session on Monday, September 26, 2011 at 6:00 PM, in the Railroad Depot Room, 2 nd Floor, City Hall, 300 North Park Avenue, Sanford, Florida. CALL TO ORDER/ROLL CALL Present: Mayor Jeff Triplett Vice Mayor Patty Mahany Commissioner Mark M ° Carty Commissioner Velma Williams Commissioner Randy Jones City Attorney William L. Colbert City Manager Norton N. Bonaparte, Jr. Public Works Director Tom George Records Manager Pat Lee Absent: City Clerk Janet Dougherty Vice Mayor Mahany called the Executive Session to order at 6:10 PM. 1. PUBLIC BRIEFING. Public briefing of City Commission relative to Maece Taylor, Inc. agreement, as modified, and history of the matters relating thereto. City Manager Bonaparte asked Public Works Director Tom George to give a history of the City's work with the golf course individuals, and how we got here today. Public Works Director Tom George stated the City entered into a lease agreement with Maece Taylor on September 27, 2007. The Lessee paid $1 million for the lease and was required to make $720,000 worth of improvements to the Club during its first full year of operation. The terms for payment were: 5% of gross revenues and $5,000 per month for the use of up to 5,000 gallons of reclaimed water per month. On 2011 -683 CITY COMMISSION MINUTES September 26, 2011 EXECUTIVE SESSION September 31, 2009, the Lessee was to pay a lump payment of 5% of revenues for the first fifteen months of operation. During the first fifteen months, the Lessee paid the reclaimed water fees each month regularly and when the lump sum payment came due on September 31, 2009, payment was not made. There was an amendment changing from electric carts to gas. They did not make a payment or the lump sum payment due on March 31, 2009 which was approximately $74,311. When they didn't make the lump sum payment, the City met with the Lessee and initiated Amendment No. 2 to help with the payment plan, setting up payments each month from June to November, 2009 to help them "catch up" from the prior year and also in January, 2010, after they made lump sum payments, provided for the Lessee to pay 2.5% of the gross revenues each month to get them on a payment plan. When the lump sum payment became due again on March 31, 2010, the Lessee was still in arrears so Amendment No. 3 was initiated in April, 2010, that provided more catch up payments for prior amounts in arrears and also provided that in January, 2011, they would pay the full 5% each month to again, get them on a monthly type payment plan instead of waiting a full year and not getting paid. They remained in arrears most of the months throughout the four years the City has had the lease with them. The City met with Mr. Phillips to try and figure out why the payments were not being made, noting they (Maece Taylor) grossed over $1.5 million in revenues over their first full year of operations or about $125,000 per month and should have been able to pay the City about $11,000 and they did not make those payments. In subsequent years, they've averaged about $1.2 million per year average revenues and 2011 -684 CITY COMMISSION MINUTES September 26, 2011 EXECUTIVE SESSION their payments to the City would have been about $10,000 and they haven't made those payments either. In early 2011, Maece Taylor met with staff and requested relief from some reclaimed water payments. Staff met with the Commission and worked out Amendment No. 4 which would forgive $2,500 per month of the reclaimed water bill for the last twelve months for a total of $30,000 and from the date the Amendment was executed, cut the reclaimed water payment in half each month. The City expected to get a thank you from the Lessee but instead received a threat of litigation. The City has recorded 39 breaches for payment requirements; 44 breaches for monthly financial reports; 3 breaches for annual payments of taxes to the County; and 25 breaches for payments for reclaimed water. At 6:18 PM, the public briefing was concluded and the Attor44y- Client Session began. Mayor J ATTEST: C Yanet Dougherty, City C rk pal