At a hastily called emergency meeting, the County Commission on Thursday liquidated $36-million in investments and used the money to take immediate ownership of Florida Water Services' Spring Hill utility.
The action came hours after Fifth Circuit Court Judge Daniel Merritt rejected a $53-million bid by the city of Weeki Wachee to condemn Florida Water, finding city ownership served no valid public purpose. In so doing, Merritt affirmed that Hernando County's competing $35.6-million condemnation offer was in the public's interest.
With Weeki Wachee out of the way, the county and Florida Water _ which sought purchase by Hernando as part of a coordinated sale of assets to local governments across the state _ moved quickly.
Viewing ownership as a way to obstruct potential appeals by Weeki Wachee, County Attorney Garth Coller called the meeting. There, he pushed through the liquidation of investment money and the deposit of the cash with the court, a move that secures title to the utility.
State law allows flexibility but suggests giving 24-hours notice for such emergency meetings so that the public can be made aware and attend if they desire. The need to complicate Weeki Wachee's possible appeal by laying claim to the utility, Coller said, justified convening quickly.
The county told the Times about the 2:30 p.m. meeting two hours before it began.
Coller's plan carries risk. Bonds meant to cover the purchase of Florida Water _ a total of $43-million due to closing costs and other expenses related to the utility's purchase _ are not to be issued until early December. With the bond money in hand, the shifted investment money will be replenished, county officials said.
Until that time, Hernando is out $36-million.
"I am clearly putting my reputation on the line," Coller said. "But this is a historic moment for Hernando County."
County Finance Director Amy Gillis said the money liquidated comes from county holdings in the State Board of Administration investment fund, the Florida Local Government Investment Trust, the Federal Home Loan Bank and Fannie May, a private mortgage lending institution that operates under congressional charter.
Gillis, like Coller, said the risk to taxpayers is minimal. But prior to the commission's unanimous vote, Gillis said she felt it was her "fiduciary responsibility" to tell the board what can occur.
"If we can't issue the bonds in a timely manner," Gillis said, "I would have spent $36-million of our available cash."
The liquidation, she said, leaves the county with $18.5-million in investment money at its immediate disposal.
County Commissioner Nancy Robinson has spent more than a decade on the board and has followed, firsthand, Hernando's struggles to buy Florida Water.
She dismissed questions about the risks involved in Thursday's action, pointing to an agreement that requires Florida Water to return the $36-million if Hernando is unable to issue the bonds.
"It's a long journey that's coming to an end," Robinson said. "I am absolutely delighted."
The stage to finalize the deal was set earlier in the day when Judge Merritt, at the hearing involving Weeki Wachee, Florida Water and the county, questioned why the city sought to condemn the utility.
Merritt asked Weeki Wachee attorney Rob Kelly whether the city's purpose was to provide a service to its nine citizens or to turn a profit on utility revenue.
While Kelly said making money on the utility was only incidental to the city's takeover bid, Florida Water attorney Bill Moore pointed to a clause in the city's condemnation filing that states that bonds issued to buy the utility also would be used toward infrastructure improvements and upgrades to the struggling Weeki Wachee Springs attraction.
Moore suggested that the difference between the county's offer and the city's $53-million offer was nothing more than extra money to be bonded and used as the city saw fit. That's illegal, Moore argued, because state law requires excess bond proceeds to have a dedicated purpose, like paying off interest.
Kelly replied that it was ridiculous to suggest that Weeki Wachee planned to "run off to Brazil" with $18-million.
"That's just fanciful," Kelly said.
Moore also attacked Weeki Wachee for suggesting their condemnation was justified because it would give the city a say in controlling area development and protecting its springs from pollution.
In unincorporated Spring Hill, home to the utility, Moore pointed out, the county has authority over land use and development. As far as protecting the springs, Moore handed out a list of the many state and federal regulations designed for just that purpose.
"They are just throwing out words," Moore said of Weeki Wachee's argument. "As much as you say a donkey is a thoroughbred, it isn't."
Assistant County Attorney Kurt Hitzemann argued that rate payers and residents should have "ballot box control" over the government running their utility.
In the case of Weeki Wachee, Hitzemann said that ballot box control rests with the wishes of nine residents. Under county ownership, the wishes of all Hernando residents could be heard on utility regulation matters, he said.
With Moore at his side, Hitzemann commented after Judge Merritt ruled in the county's favor.
"I couldn't be more pleased with the court's decision," he said. "We have always believed that we have the stronger arguments."
_ Will Van Sant can reached at 754-6127. Send e-mail to vansantsptimes.com.