Book 36 Page 10063 01/10/94 4:00 P.M. MINUTES OF THE SPECIAL MEETING OF THE SARASOTA CITY COMMISSION OF JANUARY 10, 1994 AT 4:00 P.M. PRESENT: Mayor Gene Pillot, Vice Mayor Nora Patterson, Commissioners Fredd Atkins, Mollie Cardamone and David Merrill, City Manager David Sollenberger, City Auditor and Clerk Billy Robinson, and City Attorney Richard Taylor ABSENT: None PRESIDING: Mayor Gene Pillot The meeting was called to order in accordance with Article III, Section 10 of the Charter of the City of Sarasota at 4:00 p.m. City Auditor and Clerk Robinson gave the Invocation followed by the Pledge of Allegiance to the Flag. 1. FIRST READING RE: PROPOSED ORDINANCE NO. 94-3751, AMENDING ARTICLE VIII, DIVISION 12, OF THE ZONING CODE PERTAINING TO SIGN RFGULATIONS IN THE COMMERCIAL, CENTRAL BUSINESS DISTRICT (C-CBD) ZONE DISTRICT, AMENDING SAID SIGN REGULATIONS PERTAINING TO DIRECTORY SIGNS, IDENTIFICATION SIGNS, AND SIGNAGE ON THE FIRST FLOOR OF BUILDINGS IN THE C-CBD ZONE: MAKING FINDINGS AS TO NEED; PROVIDING FOR THE SEVERABILITY OF THE PARTS HEREOF; REPEALING ORDINANCES IN CONFLICT, ETC. (TITLE ONLY) PASSED ON FIRST READING; DIRECTED THE ADMINISTRATION TO NOTIFY BUILDING OWNERS OF THE PROPOSED ORDINANCE; DIRECTED THE ADMINISTRATION TO MODIFY THE ORDINANCE RELEVANT TO HEIGHT; REQUESTED THAT THE PUBLIC HEARING BE REOPENED AT SECOND READING (AGENDA ITEM I) #1 (0028) through (1130) City Manager Sollenberger stated that this matter is continued from the Commission's Regular Meeting of January 3, 1994, at which time the Commission asked that graphics be presented as to how the proposed ordinance would work in practicality. William Hewes, Director of Building, Zoning, and Code Enforcement, and Bruce Franklin, representing the Sarasota City Center, came before the Commission. Mr. Hewes stated that currently 300 square feet of signage in three signs is allowed on top of multi-story buildings; that the proposed ordinance changes this so that 300 square feet of signage can be in four signs; that he does not believe this should be a problem. Vice Mayor Patterson asked whether a two-story building is considered multi-story? Mr. Hewes stated no; that a multi-story building has to be 50 feet high, which is usually a five-story building. Mr. Hewes stated that the proposed ordinance will allow a multi-story building to have an outdoor directory monument, which may not exceed 100 square feet; that the outdoor directory can either be a wall sign or separately mounted; that he does not believe this change will be a problem. Mr. Hewes stated that the current policy is as follows: > individual establishments of multi-story, buildings are permitted outside signs for identification with the permitted aggregate area not to exceed 300 square feet on the first floor and this remains the same in the proposed ordinance; b individual establishments located on the second floor of multi-story buildings are permitted one wall sign per street frontage at the second floor level, with the aggregate area of the sign not to exceed 40 square feet per sign, which means that each tenant on the second floor could have a 40 square foot sign in addition to the signage on the first floor. Mr. Hewes stated that the proposed policy is as follows: individual establishments located on the second floor are no longer going to be allowed to have 40 square foot signs (at the second floor level). Mr. Hewes stated that the current Zoning Code paragraph 4 is eliminated and replaced as follows: (f) All individual establishments shall be permitted to install one wall sign for identification or for advertisement of services or products available in such establishments. The aggregate area of such signs per floor shall not exceed one (1) square foot of area for each foot of building frontage. This signage shall be displayed on the ground floor, but in no event shali the ground floor aggregate area of 300 square feet be exceeded for all establishments in this section. Mr. Hewes stated that this means there will be an additional 300 square feet of signage on the ground floor that cannot be used to advertise the businesses that are on the individual floors; that a building with nine floors in addition to the first floor could have nine additional signs; however, the (building) owner determines how the 300 square feet of signage is divided. Book 36 Page 10064 01/10/94 4:00 P.M. Book 36 Page 10065 01/10/94 4:00 P.M. Mr. Hewes displayed and explained diagrams on the overhead projector and showed photographs of various buildings to the Commissioners. Mr. Hewes stated that he feels a modification should be included that covers buildings one to three or one to four stories with a maximum additional amount of signage. Vice Mayor Patterson asked whether a five-story building could have a roof sign? Mr. Hewes stated that a roof sign would be part of the building identification signs. Commissioner Cardamone asked whether the proposed ordinance was shown to the downtown merchants and the business association? Mr. Franklin stated that Merrill Lynch, a tenant in the Sarasota City Center, filed a variance petition with the Board of Adjustment because Merrill Lynch's office was above the second floor but wanted to have their name on the sign bin; that the Board of Adjustment was getting tired of approving these types of variances; therefore, meetings were held with Timothy Litchet, Manager of Zoning and Code Enforcement, and Mr. Hewes to discuss a Zoning Code amendment to address this issue as well as the directory sign issue. Mr. Franklin continued that, unbeknownst to him, the Downtown Association, who had run into some other problems with signage had drafted a change (to the Zoning Code); that this change, with input from a couple of sign companies, was shown to a number of building owners as well as members of the Downtown Association; that the Downtown Association is supportive of the proposed ordinance. Commissioner Cardamone stated that she feels tenants of second floors would protest this change. Mr. Franklin stated that he feels there is an opportunity between first and second readings of the proposed ordinance to massage the language. Mr. Hewes stated that language he would like to see massaged was the number of square footage (of signage) allowed for buildings less than ten stories. Commissioner Cardamone stated that she is concerned that the City needs to let people know about this proposed change. City Auditor and Clerk Robinson stated that the Commission already held a public hearing on this proposed ordinance; that the Planning Board also reviewed this; that these meetings were noticed in the newspaper with legal ads. Commissioner Cardamone stated that there is a good possibility that very few owners of buildings that are five (stories) or taller in the city of Sarasota even know the Commission is discussing this signage issue, let alone the occupants of the buildings. Mr. Hewes stated that members of the Downtown Association know about the proposed ordinance. Commissioner Cardamone stated that she realizes that notification is an expensive operation; however, she thinks it is imperative that the City makes an effort to let people know about the proposed changes. Vice Mayor Patterson stated that she feels the directory sign and sign on top of a building are nonissues; however, the proposed change moves permission for signage from the second floor to the first floor; that the positive change is that occupants of third, fourth, fifth, and sixth floors will be able to have signage to sell themselves. Vice Mayor Patterson asked why it is recommended to move all the signage to the first floor instead of allowing a band of signage on the second floor available for all tenants of a building to advertise? Mr. Hewes stated that most of the (owners of) newer buildings do not want signs on both the first and second floors; that people were going to the Board of Adjustment and requesting a single band of signs for aesthetic reasons. Commissioner Cardamone stated that her concern is the restrictiveness to second floor signs already is existence; that she feels there is a rush to get the proposed ordinance passed because there is a person who wants to fall into the new ordinance; that she would like to give the business community and building owners one more chance to make sure the changes are understood. Vice Mayor Patterson stated that her concern is that a mid-rise, five-story building will get to have too much signage; that she thinks this should be regulated according to the size of the building. Mr. Franklin stated that work on this issue began in June and no one is trying to rush on this; however, the issue is very complex; that he feels that the Downtown Association could be notified prior to second reading of the proposed ordinance and comments requested. Commissioner Atkins stated that Commissioner Cardamone's concerns are valid; however, he is willing to support passing the proposed ordinance on first reading and make some amendments if needed prior to second reading. Book 36 Page 10066 01/10/94 4:00 P.M. NS Book 36 Page 10067 01/10/94 4:00 P.M. city Attorney. Taylor stated that he would not have any. problem making changes of a more restrictive nature between first and second reading; that he would not want to liberalize the ordinance because it could be a potential problem with the public notice aspect. Vice Mayor Patterson stated that it seems the Commission is requesting that Mr. Hewes, provides a new interpretation that grades this (issue) by height and an attempt be made by the City Auditor and Clerk to achieve better notification of building owners before passing the ordinance on second reading. Vice Mayor Patterson asked whether the second reading could be another public hearing? City Auditor and Clerk Robinson stated yes. Mr. Robinson read proposed Ordinance No. 94-3751 by title only. On motion of Commissioner Atkins and second of Commissioner Merrill, it was moved to pass proposed Ordinance No. 94-3751 on first reading. Vice Mayor Patterson stated that the motion does not include the items the Commission discussed and asked whether an amendment was needed? Commissioner Atkins stated that he felt the items discussed were understood. It was the consensus of the Commission that it is understood that conditions of further exploration with building owners, modifications relevant to height, and that the public hearing be reopened at second reading are part of the motion. Mayor Pillot requested that city Auditor and Clerk Robinson proceed with the roll-call vote. Motion carried unanimously (5 to 0): Atkins, yes; Cardamone, yes; Merrill, yes; Patterson, yes; Pillot, yes. 2. DISCUSSION RE: OFFER FROM DEPARTMENT OF JUSTICE TO NEGOTIATE DISPOSITION OF ALLEGED VIOLATIONS OF EPA PERMIT REQUIREMENTS PERTAINING TO RECLAIMED WATER DISPOSAL AND ALLEGED VIOLATIONS RESULTING FROM OPERATION OF POTABLE WATER PLANT APPROVED THE ADMINISTRATION'S RECOMMENDATION TO AUTHORIZE SPECIAL LEGAL COUNSEL TO FORMALLY RESPOND TO THE DEPARTMENT OF JUSTICE (AGENDA ITEM II) #1 (1131) through #2 (0170) City Manager Sollenberger stated that the Mayor received a letter from the Department of Justice (DOJ) notifying the City that the Environmental Protection Agency (EPA) had referred certain matters to the DOJ for enforcement; that the City is being given the opportunity to present a settlement offer prior to the DOJ initiating litigation against the City. Mr. Sollenberger continued that this matter is very serious; that he proposes discussing the potential for a settlement offer. City Attorney Taylor stated that it is very awkward for the City to meet under these circumstances in a public meeting; that he would have preferred an Out-of-the-Sunshine meeting; however, the State Statutes only allows (for an Out-of-the-Sunshine meeting) in those circumstances where the City has already been sued and no lawsuit has been filed yet; that the Department of Justice has prepared a partial lawsuit; that the DOJ's procedure is to offer a window of opportunity for the City to open dialogue prior to a lawsuit being filed in court. Attorney Taylor continued that the City will need to be somewhat cautious because some things will be almost impossible to discuss in detail before sitting down with representatives of the DOJ and EPA to see whether things can be worked out. Mayor Pillot asked whether the Commission should wait until a lawsuit is filed so that this issue can be discussed in an Executive Session? Attorney Taylor stated that he feels the Commission should attempt to discuss this issue to its satisfaction today. Edward P. de la Parte, Jr., Esq., Special Legal Counsel, came before the Commission and stated that two Letters of Referral were sent from the Environmental Protection Agency to the Department of Justice; that one Letter of Referral deals with the City's wastewater facilities alleging 432 violations of the Clean Water Act; that the second Letter of Referral deals with the City's RO (Reverse Osmosis) facility alleging 3,600 violations of the Clean Water Act; that the letters indicate that the EPA and the Justice Department are prepared to file suit against the City on both of these items; however, the EPA and Justice Department have indicated a willingness to engage in settlement discussions prior to suit, beginning with a settlement offer from the City; that failing a settlement offer from the City, he has no reason to doubt a suit will be filed against the City. Attorney de la Parte stated that the City's RO facility is designed to produce up to 12 million gallons of potable water per day; that this facility produces four distinct waste streams that are discharged at two separate outfalls into Sarasota Bay; that one is discharged indirectly into Hog Creek and the other is discharged to Payne Terminal; that construction of the RO facility began in 1980 and was completed in 1982; that at the time of the facility's design and construction, the City Utility Department had minimal experience with respect to Reverse Osmosis facilities and how to deal with them from an environmental permitting standpoint; therefore, the City relied on its engineer, Smith & Gillespie, to identify and obtain the necessary permits for the facility, because Book 36 Page 10068 01/10/94 4:00 P.M. Book 36 Page 10069 01/10/94 4:00 P.M. Smith & Gillespie represented themselves as experts in all phases of this particular construction; that Smith & Gillespie prepared applications for, and assisted, the City in obtaining permits for exemptions from the Department of Environmental Protection, the Southwest Florida Water Management District (SWFWMD), and the State Board of Trustees of the Internal Improvement Trust Fund. Attorney de la Parte continued that Smith & Gillespie advised the City that all permits had been obtained necessary to construct and operate the facility. Attorney de la Parte displayed an excerpt from Smith & Gillespie's contract with the City that expressly required the engineer to do the following: 3) Prepare complete basis of design, together with statements of allowances, assumptions and factors all to the extent required for submission to and approval by the State Board of Health and other governmental agencies having jurisdiction. 6) Confer with officials of the State Health Department (or other state or federal agencies having jurisdiction), during the preparation of the plans and specifications; and assist the City in obtaining approval of same. Attorney de la Parte stated that late last year the City entered into a tolling agreement with Smith & Gillespie and the project engineer responsible for the project, Dr. Milton; that the tolling agreement tolls the expiration of the Statute of Limitations and freezes the Statute of Limitations situation at this point in time in order to eliminate the need for the City to rush to make a decision whether to file suit against the engineering firm until it is clear exactly what the ramifications of the actions were in terms of the EPA and the Justice Department. Attorney de la Parte continued that the City is currently in the process of seeking an amendment to the City's DEP permit and has applied for the NPDES (National Pollutant Discharge Elimination System) permit for the facility; that these applications call for the relocation of the waste streams from Hog Creek to Payne Terminal so there will only be one outfall in the future. Attorney de la Parte stated that in the late 1970s the City committed to eliminate the adverse impacts of the City's domestic sewage on Sarasota Bayi that the City committed to accomplish this by identifying and implementing a combination of facilities which would minimize quantity, frequency, and pollutant content of sewage wastes reaching surface waters, while providing for beneficial reuse of wastewater. Attorney de la Parte reviewed the Schedule of City's Efforts on the overhead projector and stated that the City engaged in a long process to purchase a site for spray irrigation; that the city then applied for the permits for this site and this is the point in time when problems began that led to the EPA complaint letter; that the City's application for the spray field was denied by the State Environmental Agency in 1986; that in February 1987 the Justice Department and EPA filed suit against the City for not meeting certain compliance deadlines with respect to the discharge to Sarasota Bay; that the suit resulted in consent orders and consent decrees being negotiated by the City in 1987 and 1988; that these consent orders and decrees set the City on a very tight schedule to meet compliance and this tight schedule contributed to the problem. Attorney de la Parte stated that one of the things the consent decree required was for the City to convert the wastewater treatment plant from a secondary treatment facility to an advanced waste treatment facility; that the City committed to an aggressive program of reuse in order to meet the compliance deadlines; that the first phase of this project was the Hi Hat Ranch and the Bobby Jones Golf Course in order to meet all of the City's current wastewater flows for annual average reuse. Attorney de la Parte continued that the environmental agencies required the City to evaluate how much storage and how many days of discharge were going to be necessary as a result of the irrigation project. Attorney de la Parte stated that because of the tight time schedule the City was under with respect to the consent order and consent decree, the City and the consultant did not perform a topographic survey of the site prior to construction to validate the amount of ridge and furrow available because it takes six months to perform a topographic survey; that as a result, the City does not have a sufficient amount of irrigation area in the first phase to cover the City's existing flows. Attorney de la Parte explained a graph showing the prediction of discharge days for 1987 and the actual experience (of discharge days) for 1993. Commissioner Merrill left the Commission Chambers at 4:58 p.m. Attorney de la Parte stated that the City proceeded immediately to add additional reuse sites as soon as it was known that the existing site was not adequate. Commissioner Merrill returned to the Commission Chambers at 5:00 p.m. Attorney de la Parte stated that when all of the reuse capacity projects are completed later this year, the City will have 7.87 MGD (million gallons a day) of reuse capacity and the current flows for the City wastewater treatment plant are 6.8 MGD; that it is believed that the additional reuse capacity and the modification of Book 36 Page 10070 01/10/94 4:00 P.M. Book 36 Page 10071 01/10/94 4:00 P.M. the discharge permit limitations will correct the discharge problems that have occurred over the last two years. Attorney de la Parte stated that the City has several defenses that are available as follows: Wastewater Facility DEP and EPA choice of discharge model DEP choice of ridge and furrow/SCS Plans > Ambiguity of permit conditions > DEP and EPA improper handling of permit modification request Lack of environmental harm DEP improper handling of permitting for added reuse sites Other mitigating factors Water Facility Safe Drinking Water Act preemption D Regulator confusion > Third party responsibility for permitting > Lack of environmental harm Attorney de la Parte stated that the history of EPA penalty policies is as follows: A. Seek 5% of maximum statutory penalty Attorney de la Parte stated that the maximum statutory penalty in the City's case is $25,000 per day per violation, which is approximately $10 million for the wastewater letter and $90 million for the RO letter. B. Seek "A Buck A Butt" Attorney de la Parte stated that this policy succeeded Policy A because a lot of small communities were unable to be held to the same sort of standard as a large city; that this policy charges an amount of money per the (number of) citizens in a particular community. C. Deprive violator of economic benefit of noncompliance Attorney de la Parte stated that Policy A and B have been supplanted in the last five years by this policy; that the EPA has adopted very complicated computer models to assist in making the determination as to what an appropriate penalty would be; that this will be the policy and procedure followed to achieve a settlement. Attorney de la Parte stated that the Commission needs to make a decision today as to what offer, if any, the City should make to the EPA to settle this matter before litigation starts; that he recommends that an offer be made to the EPA. Attorney de la Parte stated that if the City enters into a stipulated consent decree with the EPA, he would like to see certain provisions in the consent decree that will ameliorate some of the problems the City has faced with the EPA as follows: Penalty for past violations Stipulated penalty for further violations Construction schedule for improvements Agreement with EPA to reevaluate permit conditions on: maximum daily flow at WWTP fecal coliform limit authorized discharge period conversion to pound loading > Credit for penalties paid to DEP Payment of penalties over time Payment of portion of settlement to Sarasota Bay National Estuary Program Supplemental enforcement program DEP to assume enforcement responsibility upon assumption of NPDES Program Mayor Pillot asked for an explanation of the item Supplemental Enforcement Project. Attorney de la Parte stated that one example would be if the City agreed to a penalty with half going toward a project to conduct an environmental audit of a particular facility. Attorney de la Parte stated that the last item needing to be discussed is how to arrive at an initial settlement offer to the EPA; that he looked at it from what the City would save in terms of a year of litigation of this matter and the amount he arrived at was $100,000; that given the nature of the statutory penalties, he would advise dividing the settlement amount with $25,000 earmarked for the wastewater facility item and $75,000 for the RO facility item. Mr. Sollenberger stated that he feels a settlement offer is imperative and he supports the recommendation being presented by the special legal counsel. Vice Mayor Patterson stated that she would like the City Attorney to comment. Attorney Taylor stated that he does not believe it is going to be very easy to resolve this issue; however, a settlement offer would Book 36 Page 10072 01/10/94 4:00 P.M. Book 36 Page 10073 01/10/94 4:00 P.M. be the first step; that he contacted an attorney in Washington, DC who is the attorney who headed the enforcement program for the Environmental Protection Agency for a period of time and is an expert and practices as an expert in the area of dealing with federal litigation and compliance types of suits, fines, and penalties; that the attorney's name is Edward Kurent with the firm of Gilberg and Kurent; that Attorney Kurent has reinforced what Attorney de la Parte told the Commission today in terms of the way the process works; that Attorney Kurent's personal opinion is that the City of Sarasota, based on the facts as he knows them, is in good enough shape so as not to overly worry about the big numbers being thrown around; that if the City cannot successfully negotiate, the issue may have to go to court and Attorney Kurent believes the City has a lot of good things going for it that other communities do not; that he thinks Attorney Kurent would feel the proposed offer to be in the range of what is appropriate. Commissioner Merrill asked whether the City could put any conditions on the settlement offer, such as stating that the City would like the money to be given to the National Estuary Program? Attorney de la Parte stated that conditions as well as the settlement offer would be made; that he would state that "to settle the. fines and penalties for $100,000, the City would like to condition it upon payment being made of the penalties to the National Estuary Program (NEP), instead of to the EPA, for environmental projects. Mayor Pillot asked whether Supplemental Enforcement Project meant that a condition of the settlement offer could be for the City to perform additional work to get closer to good discharge of the City's treated effluent? Attorney de la Parte stated that is correct. Mayor Pillot stated that while the NEP is of significant importance, the City's projects might be of greater importance. Vice Mayor Patterson stated that she agrees with the Mayor; that the settlement offer money will come without the consent of the citizens undoubtedly in the water and sewer bills; that if the $100,000 offer could more directly benefit the citizens, she thinks it would be more logical. Commissioner Atkins stated that he has listened to this issue several times before and he has not seen the City ever win in arbitration, mitigation, or in court cases; that the bottom line is that (these problems) usually means that someone, either the Administration and the Staff or consultants, has advised the City wrong; that he thinks it is in the City's best interests to present some type of negotiation with the EPA to encourage the EPA to go light on the City this time, because the City has been doing the best it could; that he does not think the City can win a court case because the City has not adhered to the standards expected, for whatever reason; that he hopes that the Commission gives Attorney de la Parte the opportunity to finish this issue. Vice Mayor Patterson asked whether a settlement would jeopardize the City's Claims against consultants who have evidently not lived up to their obligations with a settlement? Attorney de la Parte stated that he did not believe so; that he thinks the City should send Smith & Gillespie a copy of the City's offer to the EPA, before sending the offer to the EPA, with a letter asking Smith & Gillespie to provide any defenses to eliminate any liability on the City's part and to advise of any reason why it is believed these defenses are available to the City. Attorney de la Parte continued that in the case law that he has studied, if the City follows this process, he thinks the City would be in a solid position later on if the City decides to litigate against Smith & Gillespie to seek compensation of the settlement. Mayor Pillot asked why Smith & Gillespie entered into a tolling agreement with the City? Attorney de la Parte stated that it is in Smith & Gillespie's interest to try to resolve this matter with the EPA as low as possible and as expeditiously as possible. Vice Mayor Patterson stated that it seems to her that the earlier consultants, who evidently advised the City that the model that ignored the reality of the rainy season and the topography of the land, which was unknown at the time, have a certain responsibility as well. Attorney Taylor stated that Attorney Kurent is looking at the issue of Camp, Dresser & McKee for the city; that Camp, Dresser & McKee actually became involved in the process much later in point of time; that he does not think the City is prejudicing itself with regard to Camp, Dresser & McKee. Mayor Pillot stated that he wanted to summarize his position on three factors: 1) he agrees with the comments made by Commissioner Atkins, 2) he agrees with the recommendation of Attorney de la Parte, and 3) he agrees with the recommendation of the City Manager to approve Attorney de la Parte's recommendation. On motion- of Vice Mayor Patterson and second of Commissioner Cardamone, it was moved to approve the Administration's recommendation to authorize Special Legal Counsel to formally respond to the Department of Justice. Motion carried unanimously (5 to 0): Atkins, yes; Cardamone, yes; Merrill, yes; Patterson, yes; Pillot, yeso Book 36 Page 10074 01/10/94 4:00 P.M. Book 36 Page 10075 01/10/94 4:00 P.M. 3. CITIZENS' INPUT (AGENDA ITEM III) #2 (0171) through (0172) There was no one signed up to speak. 4. OTHER MATTERS (AGENDA ITEM IV) #2 (0173) through (0174) There were no other matters. 5. ADJOURN (AGENDA ITEM V) #2 (0175) The Special Meeting of the Sarasota City Commission of January 10, 1994 adjourned at 5:35 p.m. hbe GENE M. PILLOT, MAYOR ATTEST: 19 BillE Robenson BILLY ECROBINSON, CITY AUDITOR AND CLERK