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MAY 25, 2010 MINUTESCITY COUNCIL MAYOR WILLIAM D. SESSOMS, JR., At -Large VICE MAYOR LOUIS R. JONES, Bayside - District 4 RITA SWEET BELLITTO, At -Large GLENN R. DAVIS, Rose Hall - District 3 WILLIAM R. DeSTEPH, At -Large HARRY E. DIEZEL, Kempsville - District 2 ROBERT M. DYER, Centerville - District I BARBARA M. HENLEY, Princess Anne — District 7 JOHN E. UHRIN, Beach -- District 6 ROSEMARY WILSON, At -Large JAMES L. WOOD, Lynnhaven -District 5 CITY COUNCIL APPOINTEES CITY MANAGER - JAMES K. SPORE CITY ATTORNEY MARK D. STILES ('ITY ASSESSOR JERALD BANAGAN CITY AUDITOR -- LYNDON S REM/AS ('/7Y CLERK - RUTH HODGES FRASER, MMC CITY OF VIRGINIA BEACH "COMMUNITY FOR A LIFETIME" CITY COUNCIL AGENDA 25 MAY 2010 CITY HALL BUILDING 2401 COURTHOUSE DRIVE VIRGINIA BEACH, VIRGINIA 23456-8005 PHONE: (757) 385-4303 FAX (757) 385-5669 E- MAIL: Ctycncl@vbgov.com I. CITY MANAGER'S BRIEFING: II. IV. - Conference Room - A. INTERIM FINANCIAL STATEMENT Patricia Phillips, Director — Finance Department CITY COUNCIL COMMENTS CITY COUNCIL AGENDA REVIEW INFORMAL SESSION A. CALL TO ORDER — Mayor William D. Sessoms, Jr. - Conference Room - B. ROLL CALL OF CITY COUNCIL C. RECESS TO CLOSED SESSION 4:00 PM 4:30 PM V. FORMAL SESSION - City Council Chamber - 6:00 PM A. CALL TO ORDER — Mayor William D. Sessoms, Jr. B. INVOCATION: Reverend Clark Dennis Cundiff Pastor, Nimmo United Methodist Church C. PLEDGE OF ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA The National Anthem Solo: Little Miss Alana Springsteen D. ELECTRONIC ROLL CALL OF CITY COUNCIL E. CERTIFICATION OF CLOSED SESSION F. MINUTES 1. INFORMAL and FORMAL SESSIONS G. FORMAL SESSION AGENDA H. MAYOR'S PRESENTATIONS 1. RESOLUTIONS OF RECOGNITION a. Green Run High School "Inspiration Award" b. Gloria Winkler, MMC, Senior Deputy City Clerk I. PUBLIC BID OPENING 1. AWARD LICENSE WESTIN TOWER at Town Center J. PUBLIC HEARINGS 1. INSTALLMENT PURCHASE AGREEMENTS Acquisition of Agricultural Land Preservation (ARP) Easements 756 and 772 Princess Anne Road May 11,2010 2. LEASE OF CITY -OWNED PROPERTY a. 3rd Street and Atlantic Avenue b. T -Mobile Northeast, LLC - 616 North Great Neck Road 3. SALE OF EXCESS PROPERTY 2278 Wolf Street 4. PPEA PROPOSAL Adoption Friendly Animal Shelter K. CONSENT AGENDA L. ORDINANCES/RESOLUTIONS 1. Ordinance to AMEND Section 5-401 of the City Code re fees for the impoundment, spaying or neutering of animals 2. Resolutions re Water and Sewer Bonds: a. AUTHORIZE Refunding Bonds, Series of 2010, not to exceed $125 -Million b. Ninth Supplemental Master Water and Sewer Revenue Bond Resolution of February 11, 1992 3. Ordinance to DECLARE City property EXCESS at 280 London Bridge Road and AUTHORIZE the City Manager to sell the property to Robert F. Sutherland 4. Ordinance to ESTABLISH the rights-of-way of Princess Anne Road between Oakmears Crescent and Hampshire Lane, Witchduck Road and Kempsville Road between Bonney Road and Chief Trail as underground utility corridors and AUTHORIZE the Director of Public Works to EXECUTE Agreements for reimbursement of costs with the Virginia Department of Transportation (VDOT) and the utility owners 5. Ordinances to AUTHORIZE acquisition of Agricultural Land Preservation (ARP) easements to Whale Wallow, L.C.: a. 772 Princess Anne Road $1,617,805 b. 756 Princess Anne Road $1,290,666 6. Ordinance to AUTHORIZE the City Manager to EXECUTE a Lease for vehicular parking with the Dolphin Run Condominium Association, Inc. at 3rd Street and Atlantic Avenue 7. Ordinance to AUTHORIZE and DIRECT the City Manager to EXECUTE a Lease with T -Mobile re telecommunications at 616 North Great Neck Road 8. Ordinance to AUTHORIZE and DIRECT the City Manager to EXECUTE a Virginia Water and Wastewater Agency Response Network Mutual Aid Agreement 9. Ordinance to AUTHORIZE temporary encroachments into a portion of City -owned right-of-way for EDWARD F. and CHRISTEL L. LEWIS at Croatan Beach, 522 South Atlantic Avenue, to construct and maintain an elevated wood walk, steps and observation platform for beach access DISTRICT 6 — BEACH 10. Ordinance to APPROPRIATE $200,000 from the U.S. Department of Homeland Security, Federal Emergency Management Agency (FEMA), to the FY2009-10 Operating Budget of the Fire Department re deployment of VA-TF2 Tram for Haiti Earthquake 11. Ordinance to ACCEPT and APPROPRIATE $200,000 grant funds from the U.S. Department of Energy, with Federal revenues increased accordingly, to the FY2009-10 Operating Budget of the Planning Department re development of an energy assurance program 12. Ordinance to APPROPRIATE $90,000 from the Fund Balance of the Sheriff's Department Inmate Services to the FY2009-10 Operating Budget of the Sheriff's Department to support medical deputy positions 13. Ordinance to APPROPRIATE $1,266,587 of the fund balance and TRANSFER to the Agricultural Reserve Program (ARP) Special Revenue Fund to cover the costs for the purchase of various agricultural land preservation easements 14. Ordinance to TRANSFER $265,210 from the General Fund Reserve for Contingencies to the FY2009-10 Operating Budget of the Sheriff's Department re State imposed furlough and absorbing benefits 15. Ordinance to TRANSFER $52,135 from the Fire Department's Operating Budget re the purchase of replacement defibrillators M. PLANNING 1. Applications of BREATHWAITE PLACE at 732-746 Newtown Road and 5573 Rock Creek Lane re townhouse dwellings BAYSIDE — DISTRICT 4 a. Street Closure re proposed multi -family project b. Change of Zoning from R-7.5 Residential District to Conditional A-24 Apartment District RECOMMENDATION APPROVAL 2. Application of JACQUELINE B. AMATO to enlarge a Nonconforming Structure at 5306 Atlantic Avenue. LYNNHAVEN - DISTRICT 5 RECOMMENDATION APPROVAL 3. Application of CHESAPEAKE ATLANTIC, LLC for Modification of Conditional Change of Zoning (approved by City Council on October 24, 2006) at 173 and 177 South Birdneck Road and 1228 Jenson Drive. BEACH — DISTRICT 6 RECOMMENDATION REFER BACK TO PLANNING COMMISSION 4. Application of GRACE BIBLE CHURCH for Modification of Conditions 1 and 2 (approved by City Council on April 24, 2007) at Ansol Lane ROSE HALL — DISTRICT 3 RECOMMENDATION APPROVAL 5. Application of HARVEST OUTREACH MINISTRIES, INC. for Modification of Conditions 1 and 2 (approved by City Council on March 25, 2008) at 3168 Indian River Road. PRINCESS ANNE — DISTRICT 7 RECOMMENDATION APPROVAL 6. Application of VIRGINIA BEACH UNITED METHODIST CHURCH for a Conditional Use Permit re expansion of the church for religious uses at 212 19th Street. BEACH - DISTRICT 6 RECOMMENDATION APPROVAL 7. Application of T -MOBILE NORTH EAST, L.L.C./EDISON LANE STORAGE ASSOC., LLC, for a Conditional Use Permit re a communication tower at 1744 General Booth Boulevard. PRINCESS ANNE — DISTRICT 7 RECOMMENDATION APPROVAL 8. Application of the CITY OF VIRGINIA BEACH for a Conditional Use Permit re outdoor artists market (flea market) at Parks Avenue and 19th Street BEACH — DISTRICT 6 RECOMMENDATION 9. Ordinances to AMEND the City Zoning Ordinance (CZO): APPROVAL a. Sections 111, 215, and 216 to ADD Section 218 defining electronic display billboards and ESTABLISH a fee in the amount of Four Hundred Dollars ($400.00) for electronic display billboard applicataions as authorized by Virginia Code Section 15.2-2286 (A)(6) b. Section 501 to allow cemeteries, columbariums, crematoriums and mausoleums as Conditional Uses in the R-20, R-30 and R-40 Residential Zoning Districts RECOMMENDATION APPROVAL N. APPOINTMENTS BEACHES and WATERWAYS COMMISSION SOCIAL SERVICES BOARD TIDEWATER TRANSPORTATION DISTRICT COMMISSION OF HAMPTON ROADS TIDEWATER YOUTH SERVICES COMMISSION O. UNFINISHED BUSINESS P. NEW BUSINESS Q. ADJOURNMENT Agenda 05/25/2010gw www.vbgov.com ******** If you are physically disabled or visually impaired and need assistance at this meeting, please call the CITY CLERK'S OFFICE at 385-4303 * * * * * * * * * * * 1 MINUTES VIRGINIA BEACH CITY COUNCIL Virginia Beach, Virginia May 25, 2010 Mayor William D. Sessoms, Jr., called to order the CITY MANAGER'S BRIEFING to present the INTERIM FINANCIAL STATEMENT in the City Council Conference Room, Tuesday, May 25, 2010, at 4:00 P.M Council Members Present: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Barbara M Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Absent: Robert M. Dyer [111 - Entered: Formal Session 6:00 P.M.] May 25, 2010 11 2 CITY MANAGER'S BRIEFING INTERIM FINANCIAL STATEMENT ITEM # 59959 Patricia Phillips, Director of Finance, presented the Interim Financial Statement: July 1 through April 30, 2010. This statement provides a summary of the City's major fund performance in comparison to the budget as well as the prior year's performance. General Fund Revenues, as of April 30, 2010, total $631.3 -Million, as a result of the April 29th receipt of the unbudgeted $18.1 -Million Southeastern Public Service Authority (SPSA) repayment. Because of the SPSA collection, current year revenues are 60.5% of the budget, compared to 59.7% in FY 2009 and 58.9% in FY 2008. Without the collection of the SPSA revenue, the current year percentage of budget would be 58.8%. 1 FY2010 General Fund Revenues 1 FY 2010 General Fund Expenditures 1 Limited Projections 1 Next Steps Revenues Local Revenues* State Revenues** Federal Revenues Total Revenues Overview FISCAL YEAR 2009-2010 General Fund Revenues and Expenditures Compared to Budget Thru April 30, 2010 (in millions) Annual YTD Budget Actual Variance $ 861.5 $ 530.3 $ (331.2) 159.1 83.6 (75.5) 23.1 17.4 (5.7) $ 1,043.7 $ 631.3 $ (412.4) Expe nditure s/Encumbrances Departmental Totals $ 530.5 $ 428.1 $ 102.4 Transfers 564.1 474.5 89.6 Reserve for Contingencies 2.3 2.3 Total Expenditures/Encumbrances $ 1,096.9 $ 902.6 $ 194.3 Less Amounts Funded from Fund Balance Outstanding Encumbrance at 6/30/09 $ 6.1 Approved Carryover Requests 1.2 Funding for City Capital Projects 33.9 SPSA Disposal 7.2 Operarting Budget FY10 4.8 Adjusted Expenditures/Encumbrances $ 1,043.7 *Local Revenues reflect SPSA payment of $18.1M in April **State Revenues contain PPTRA Budget of $53.4M and Actual of $6.5M May 25, 2010 100% 80% 20% 0% -3- CITY MANAGER'S BRIEFING INTERIM FINANCIAL STATEMENT ITEM # 59959 (Continued) FY 2010 Year To Date General Fund Revenues Compared to Historic Trend April 30, 2010 100.0°/ ----) L- YTD ACTUAL = $631.3M 71.3% 60.5% ANNUAL BUDGET = $1,043.7M 43.2' , 55. 50.2% 46.0% 49.5% 45.7% 0/, ^' 55.3% 58.6% 23.5% 24.4% 42.5% 1.9% ....... 14.4% 9.7% 14.0% 4.4% 9.5% 7°/. 5.2% Jul Aug Sep Oct Nov —4—Rev Trend —7K— % of FYI 0 Rev Budget Jan Feb Mar Apr May Jun FY 2010 — General Fund Revenues The next few months are critical ... Several items are on a 1-2 month lag • Real Estate 2nd installment due June 5th • Local Annual Personal Property Tax due June Sth • State Revenues received after June 30th: About $51 -Million of $157 -Million Revenues $ Million $600 Real Estate Revenues April 30, 2006 - 2010 0500 -0400 - $383.3 0300 - 0200 — 0100 — FAVORABLE TREND 100% — 80% 00 FY 2006 FY 2007 FY 2008 FY 2008 ®Actual Coll.cOmu CYT° r-% of Total June 5ih billing = $239.7M ($5.8M Tess than FY 2009) FY 2010 %of Total Collections 4 May 25, 2010 Revenues $ Million -4 - CITY MANAGER'S BRIEFING INTERIM FINANCIAL STATEMENT ITEM # 59959 (Continued) Senior and Disabled Credit April 30, 2006 - 2010 # Qualified Sao FY 2006 1 4.539 1 FY 2007 1 5.420 1 FY 2006 Through June 30 1 6,408 1 FY 2008 1 7.143 1 FY 2010 1 7,654 1 Personal Property Taxes — Local Billed April 30, 2006 - 2010 UNFAVORABLE TREND 873.1 — 80% FY 2006 FY 2007 FY 2008 FY 2009 t�AeWI Collections YTO este.% of Total FY 2010 Yo of Total Collections May 25, 2010 Revenues S Million 060 -5- CITY MANAGER'S BRIEFING INTERIM FINANCIAL STATEMENT ITEM # 59959 (Continued) General Sales Taxes April 30, 2006 - 2010 UNFAVORABLE TREND 4% Down from FY09 6.0% 2.0% 0.0% -4.0% FY 2006 FY 2007 FY 2008 FY 2009 Camil Actual Collections =II YTD —C+.•% of Total FY 2010 General Sales Taxes Collections Monthly %Change from FY09 to FY10 100% 80% 60% 40% 20% 0A % of Total Collections 6.1% 1.9% -8.0% i-- -10.0% cP 494* 0,4 eideaMonthly % Change from PY * Collections lag sales by 2 months 9.9%,, 64, 00 May 25, 2010 -6- CITY MANAGER'S BRIEFING INTERIM FINANCIAL STATEMENT ITEM # 59959 (Continued) Business Licenses — (BPOL) April 30, 2006 - 2010 $50 150% UNFAVORABLE TREND 641.8 $41.0 BUDGET $40.6 - 125% 50 FY 2006 FY 2007 FY 2008 FY 2009 ®Mn al Collector* MOM YTD e.t.a% of Total Hotel Room Taxes April 30, 2006 - 2010 1.9% down from FY09 UNFAVORABLE TREND FY2010 FY 2006 FY 2007 FY 2008 FY 2009 =Actual Collections =IS YTD of Total FY 2010 0% 150% 125% 0 0 0 f 0 100% c 0 u 0 0 75% o 0 1— `0 50% 25% 0% 2 May 25, 2010 11 0 0 tl Revenues $ Million -7- CITY MANAGER'S BRIEFING INTERIM FINANCIAL STATEMENT ITEM # 59959 (Continued) Restaurant Meal Taxes April 30, 2006 - 2010 0.1% Down from FY09 UNFAVORABLE TREND 150% - 125% FY 2006 930 FY 2007 FY 2008 FY 2009 ® Actual Collections YTD rr.%of Total Utility Taxes April 30, 2006 - 2010 UNFAVORABLE TREND FY 2010 BUDGET $25.7 100% FY 2006 FY 2007 FY 2008 FY 2009 ® Annual Collections HIM YTD —o—% of Total FY 2010 % of Total Collections % of Total Collections May 25, 2010 I II *30 *25 c $20 2 • 515 *10 *5 *0 -8- CITY MANAGER'S BRIEFING INTERIM FINANCIAL STATEMENT ITEM # 59959 (Continued) Virginia Telecommunications Tax April 30, 2006 - 2010 FY 2006 FY 2007 FY 2008 FY 2009 1 CCCCIAnnu•I Collections IIIMMYTD —o.ci%of Total FY 2010 — General Fund State Revenue Reductions • $3.5 -Million Reduction to the Original Budget > Recordation Fees $1,725,638 ➢ State Aid Law Enforcement $783,677 > Constitutional Officers & Appointed Officials $712,723 > Human Services $281,319 > State Aid to Libraries $12,695 FY 2010 120% 100% 80% 60% 40% 20% 0% % of Total Collections • Additional Reductions: ➢ Maintenance of Roads $1,139,314 ➢ State Aid Law Enforcement $83,521 > Compensation Board reductions in 4th Quarter reimbursement to Constitutional Officers $89,623 > Public Assistance Grant $1 -Million (offset with Federal Stimulus Funding) May 25, 2010 Revenues $ Million -9 - CITY MANAGER'S BRIEFING INTERIM FINANCIAL STATEMENT ITEM# 59959 (Continued) Summary of General Fund Revenues April 30, 2010 (In Millions) Real Estate Taxes $477.1 $256.2 53.7 % Personal Property Taxes 64.2 18.0 28.1 PPTRA 53.4 6.5 12.2 - General Sales Tax 51.1 37.7 73.7 U Utility Taxes 25.7 19.5 75.9 11 Telecommunications Tae 23.7 14.5 61.3 11 Franchise Taxes 5.9 4.1 69.3 F Business Licenses 40.6 36.8 90.9 11 Restaurant Taxes 49.8 40.0 80.3 U Hotel Taxes 23.9 19.4 81.1 U Cigarette Taxes 12.9 9.9 76.5 13 Automobile Licenses 9.1 6.4 70.4 11 Amusement Taxes 5.3 4.4 83.8 A City Taxon Deeds 5.9 4.5 76.7 F Interest on Bank Deposits 5.7 0.5 8.8 1.1 Other Local Revenues 60.6 40.3 66.5 1 State Revenues 105.7 77.1 72.9 l.! Federal Revenues 23.1 17.4 75.2 F $ 1,043.7 $ 613.2 58.8 % U SPSA - 18.1 - $1.043.7 $ 631.3 60.5 % F Excludes Schools Revenues FY 2010 Year -to -Date General Fund Revenues Prior Fiscal Years Year -End Results $1,500 $1,000 $500 $0 FY 2007 FY 2008 FY 2009 °Annual Actual ■Annual Budget FY 2010 May 25, 2010 II - 10 - CITY MANAGER `SBRIEFING INTERIM FINANCIAL STATEMENT ITEM # 59959 (Continued) General Fund Projected Revenues with SPSA General Fund Projected Revenues without SPSA May 25, 2010 Percent of Total Expenditures -11 - CITY MANAGER'SBRIEFING INTERIM FINANCIAL STATEMENT ITEM # 59959 (Continued) FY 2010 Year -to -Date General Fund Expenditures Compared to Historic Trend April 30, 2010 100% 80% Y 60% 1- 0 40% 20% 0% 100A% Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Expendiuue Trend 'Z %of FYIO Exp Budget FY 2010 Year -to -Date General Fund Revenues & Expenditures Compared to Historic Trend At April 30, 2010 1000/a 80°/a 60% 40% 20% 0% 100.0% 94.8% - 85.58- 85.5% 81 94,8% YTD ACTUAL = $902.6M .:.a _9.3% 5 • `. 58.60 51.9"/0, ' 502° 553', 44.8% .1.6%46.0° 43.2% 49S"., 3, 6% 44.2% , 5" 45.7% 29.0% 37.2% 28.3% 23' 24.4" 0 17.0` -1 ANNUAL BUDGET = $1,096.9M 68.1 ��% 73.8% 66.8% 82.3% 60.6% 44.8, i 37.6% 51.97, 51.6 ee 2'" 59.3% 29.0%37.2% 1' 0'%. 28.3% 89/0 17.0% 9.8% Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Expendiuue Trend 'Z %of FYIO Exp Budget FY 2010 Year -to -Date General Fund Revenues & Expenditures Compared to Historic Trend At April 30, 2010 1000/a 80°/a 60% 40% 20% 0% 100.0% 94.8% - 85.58- 68.I'Y 73.8% 71.3% 60.6" y`"'✓'w .6.8"/0 60.5% SPSA$18.1M .:.a _9.3% 5 • `. 58.60 51.9"/0, ' 502° 553', 44.8% .1.6%46.0° 43.2% 49S"., 3, 6% 44.2% , 5" 45.7% 29.0% 37.2% 28.3% 23' 24.4" 0 17.0` State $ received after 6/30/10 - PPTRA $46.9M - Other $4.6M B.v % 17.0% 14.4% 9.7% 14.0% 9.8%4 0 95^G, 1.9% % 5.2% Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun '-e-Rev Trend ...-Expenditure Trend tet -%of FY 10 Rev Budges -.xu.%of FYIO Exp Budget May 25, 2010 - 12 - CITY MANAGER'S BRIEFING INTERIM FINANCIAL STATEMENT ITEM # 59959 (Continued) General Fund FY 2010 Expenditures 1 Total at April 30, 2010: $902.6M, or 82.3%, of $1.09B Budget 1 Summary of Actual Expenditures Under Budget at June 30: Sav 2007 (Actual 2008 (Actual 2009 (Actual) Total $41.7 $60.3 $43.0 ice.. millions) 10 of Total Budget 4.1% 5.6% 3.8% f© of Cit Budge $25.9 $25.0 $28.1 General Fund Projected Expenditures Bottom Line 3.8% 3.5% 3.6% Revenues <$14M - $20M> under SPSA $18.1M $ OM - $ 2M over Expenditures <$22M - $28M> under May 25, 2010 Dollars (Millions) - 13 - INTERIM FINANCIAL STATEMENT ITEM # 59959 (Continued) Undesignated General Fund Balance 12.8% 11.+% 11.0% 10.1% E.9% Projected 10.0% 9.0% 16.0% 12.0% 8.0% 2007 2008 2009 =Undesignated GF Balance of Budgeted GF Revenue Policy = 8-12% of Revenues Next Steps 1 Continue to Monitor Revenues in FY 2010 • Personal Property — May/June • Real Estate — May/June 1 Next briefing on June 22, 2010 for data through May 2010. 1 "Close out"—August 13 of Budgeted GF Revenue 27 May 25, 2010 - 14 - CITY COUNCIL COMMENTS 4:22 P.M. ITEM # 59960 Mayor Sessoms advised Councilman Dyer was ill, but hopes to arrive for the Formal Session. Mayor Sessoms and City Council wished Councilman John E. Uhrin a very Happy Birthday. Mayor Sessoms wished to congratulate new Grandparents: Council Lady Barbara Henley and City Manager Jim Spore. ITEM # 59961 Councilman Diezel referenced the last meeting, May Twenty-fourth re Mayor's Committee on Employee Pensions. Councilman Diezel served as Chair and Councilman Davis as Vice Chair. Other members served that represented both the employees as well as the community. An Executive Summary will be provided within the next two or three weeks. The Committee will probably make recommendations that can be utilized internally and also ask that you City Council consider for lobbying interest to the General Assembly. The VRS (Virginia Retirement System) is a legislative system and the representatives of VRS are administrators of that regulatory process. This was an excellent committee. ITEM # 59962 Mayor Sessoms referenced the grand opening of JT's Grommet Island Beach Park and Playground on May 22, 2010. The idea was born when Josh Thompson's family wanted to go to the beach, but he stayed behind because of the difficulty of getting his wheelchair to the beach, across the sand and down to the surf The park idea was born, Bruce Thompson, Josh's Dad, took the idea of a 100% handicap accessible Oceanfront park to the City where it was embraced with enthusiasm. JT Walk and Beach Party will continue its work this year with a portion of the money going toward an endowment for the Park's maintenance and improvements. May 25, 2010 - 15 - AGENDA REVIEW SESSION 4:25 P.M. ITEM # 59963 Council Lady Bellitto inquired re the meaning of the "emergency assurance program": 11. Ordinance to ACCEPT and APPROPRIATE $200, 000 Grant funds from the U.S. Department of Energy, with Federal revenues increased accordingly, to the FY2009-10 Operating Budget of the Planning Department re development of an energy assurance program The City Manager advised this $200, 000 Grant award from the U.S. Department of Energy was received through the 2009 American Recovery and Reinvestment Act's Local Energy Assurance Plan (LEAP) Grant program. This initiative will allow the City to develop a standardized energy assurance and resiliency plan to rely on during energy emergencies and supply disruptions. Item # 59964 BY CONSENSUS, the following items shall compose the CONSENT AGENDA: L. ORDINANCES/RESOLUTIONS 1. Ordinance to AMEND Section 5-401 of the City Code re fees for the impoundment, spaying or neutering of animals 2. Resolutions re Water and Sewer Bonds: a. AUTHORIZE Refunding Bonds, Series of 2010, not to exceed $125 -Million b. Ninth Supplemental Master Water and Sewer Revenue Bond Resolution of February 11, 1992 3. Ordinance to DECLARE City property EXCESS at 280 London Bridge Road and AUTHORIZE the City Manager to sell the property to Robert F. Sutherland 4. Ordinance to ESTABLISH the rights-of-way of Princess Anne Road between Oakmears Crescent and Hampshire Lane, Witchduck Road and Kempsville Road between Bonney Road and Chief Trail as underground utility corridors and AUTHORIZE the Director of Public Works to EXECUTE Agreements for reimbursement of costs with the Virginia Department of Transportation (VDOT) and the utility owners 5. Ordinances to AUTHORIZE acquisition of Agricultural Land Preservation (ARP) easements to Whale Wallow, L.C.: a. 772 Princess Anne Road $1,617,805 b. 756 Princess Anne Road $1,290,666 6. Ordinance to AUTHORIZE the City Manager to EXECUTE a Lease for vehicular parking with the Dolphin Run Condominium Association, Inc. at 3rd Street and Atlantic Avenue 7. Ordinance to AUTHORIZE and DIRECT the City Manager to EXECUTE a Lease with T -Mobile re telecommunications at 616 North Great Neck Road May 25, 2010 - 16 - A GEN DA REVIEW SESSION ITEM # 59964 (Continued) 8. Ordinance to AUTHORIZE and DIRECT the City Manager to EXECUTE a Virginia Water and Wastewater Agency Response Network Mutual Aid Agreement 9. Ordinance to AUTHORIZE temporary encroachments into a portion of City - owned right-of-way for EDWARD F and CHRISTEL L. LEWIS at Croatan Beach, 522 South Atlantic Avenue, to construct and maintain an elevated wood walk, steps and observation platform for beach access DISTRICT 6 — BEACH 10. Ordinance to APPROPRIATE $200, 000 from the U.S. Department of Homeland Security, Federal Emergency Management Agency (FEMA), to the FY2009-10 Operating Budget of the Fire Department re deployment of VA-TF2 Team for Haiti Earthquake 11. Ordinance to ACCEPT and APPROPRIATE $200, 000 grant funds from the U.S. Department of Energy, with Federal revenues increased accordingly, to the FY2009-10 Operating Budget of the Planning Department re development of an energy assurance program 12. Ordinance to APPROPRIATE $90, 000 from the Fund Balance of the Sheriff's Department Inmate Services to the FY2009-10 Operating Budget of the Sheriff's Department to support medical deputy positions 13. Ordinance to APPROPRL4TE $1,266,587 of the fund balance and TRANSFER to the Agricultural Reserve Program (ARP) Special Revenue Fund to cover the costs for the purchase of various agricultural land preservation easements 14. Ordinance to TRANSFER $265,210 from the General Fund Reserve for Contingencies to the FY2009-10 Operating Budget of the Sheriff's Department re State imposed furlough and absorbing benefits 15. Ordinance to TRANSFER $52,135 from the Fire Department's Operating Budget re the purchase of replacement defibrillators Councilman DeSteph will ABSTAIN, on Items 5a/b (Agricultural Land Preservation (ARP) easements to Whale Wallow, L.C. and 13 (Agricultural Reserve Program (ARP) Special Revenue Fund to cover the costs for the purchase of various agricultural land preservation easements) May 25, 2010 1 - 17 - AGENDA REVIEW SESSION ITEM # 59965 Stephen White, Planning, provided a revised Plat and Page 1 of the Ordinance reflecting A correction in Item M. 1: Applications of BREATHWAITE PLACE at 732-746 Newtown Road and 5573 Rock Creek Lane re townhouse dwellings BAYSIDE DISTRICT 1 KEMPSVILLE — DISTRICT 2 a. Street Closure re proposed multi family project b. Change of Zoning from R-7.5 Residential District to Conditional A-24 Apartment District ITEM # 59966 BY CONSENSUS, the following items shall compose the PLANNING BY CONSENT AGENDA: M PLANNING 1. Applications of BREATHWAITE PLACE at 732-746 Newtown Road and 5573 Rock Creek Lane re townhouse dwellings BAYSIDE DISTRICT 1 KEMPSVILLE — DISTRICT 2 a. Street Closure re proposed multi family project b. Change of Zoning from R-7.5 Residential District to Conditional A-24 Apartment District 2. Application of JACQUELINE B. AMATO to enlarge a Nonconforming Structure at 5306 Atlantic Avenue. LYNNHA VEN - DISTRICT 5 3. Application of CHESAPEAKE ATLANTIC, LLC for Modification of Conditional Change of Zoning (approved by City Council on October 24, 2006) at 173 and 177 South Birdneck Road and 1228 Jenson Drive. BEACH— DISTRICT 6 4. Application of GRACE BIBLE CHURCH for Modification of Conditions 1 and 2 (approved by City Council on April 24, 2007) at Ansol Lane ROSE HALL — DISTRICT 3 5. Application of HARVEST OUTREACH MINISTRIES, INC. for Modification of Conditions 1 and 2 (approved by City Council on March 25, 2008) at 3168 Indian River Road. PRINCESS ANNE — DISTRICT 7 May 25, 2010 -18 - AGENDA REVIEW SESSION ITEM # 59966 (Continued) 6. Application of VIRGINIA BEACH UNITED METHODIST CHURCH for a Conditional Use Permit re expansion of the church for religious uses at 212 19th Street. BEACH - DISTRICT 6 7. Application of T -MOBILE NORTHEAST, L.L.C./EDISONLANE STORAGE ASSOC., LLC, for a Conditional Use Permit re a communication tower at 1744 General Booth Boulevard. PRINCESS ANNE — DISTRICT 7 8. Application of the CITY OF VIRGINIA BEACH for a Conditional Use Permit re outdoor artists market (flea market) at Parks Avenue and 19th Street BEACH— DISTRICT 6 9. Ordinances to AMEND the City Zoning Ordinance (CZO): b. Section 501 to allow cemeteries, columbariums, crematoriums and mausoleums as Conditional Uses in the R-20, R-30 and R-40 Residential Zoning Districts Item M3. (Chesapeake Atlantic, LLC) shall be REFERRED BACK TO THE PLANNING COMMISSION, BY CONSENT Vice Mayor Jones DISCLOSED Pursuant to Section 2.2-3115(G), Code of Virginia re City Council's discussion and vote on Section 501 of the City Zoning Ordinance to allow cemeteries, columbariums, crematoriums and mausoleums as Conditional Uses in the R-20, R-30 and R-40 Residential Districts (Item 9b). Vice Mayor Jones is a member of the funeral business, and has an ownership interest in both Tidewater Cemetery Corporation and Holloman -Brown Funeral Home, Inc. His ownership interest in both corporations exceeds 3% of the total equity in each corporation. He is a member of a business or profession (the funeral business) and a group (persons with an ownership interest in the funeral business) the members of which are affected by City Council 's consideration of this application. Although he is able to participate fairly, objectively and in the public interest, Vice Mayor Jones wishes to ABSTAIN. Vice Mayor Jones' correspondence of May 24, 2010, is hereby made a part of the record. May 25, 2010 - 19 - ITEM # 59967 Mayor William D. Sessoms, Jr., entertained a motion to permit City Council to conduct its CLOSED SESSION, pursuant to Section 2.2-3711(A), Code of Virginia, as amended, for the following purpose: PERSONNEL MATTERS: Discussion, consideration of or interviews of prospective candidates for employment, assignment, appointment, promotion, performance, demotion, salaries, disciplining or resignation of specific public officers, appointees or employees pursuant to Section 2.2-3711 (A)(1) Council Appointments: Boards, Commissions, Committees, Authorities, Agencies and Appointees PUBLICLY -HELD PROPERTY. Discussion or consideration of the, acquisition, or of the disposition of publicly -held property, where discussion in an open meeting would adversely affect the bargaining position or negotiating strategy of the public body pursuant to Section 2.2-3711(A)(3). Acquisition/Disposition of City Property: Kempsville District Princess Anne District Upon motion by Councilman Wood, seconded by Council Lady Wilson, City Council voted to proceed into CLOSED SESSION at 4:32 P.M. Voting: 10-0 Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Barbara M Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: Robert M Dyer (Closed Session: 4:32 P.M. - 5:30 P.M.) (Dinner: 5:30 P.M. - 5:55 P.M.) May 25, 2010 - 20 - FORMAL SESSION VIRGINIA BEACH CITY COUNCIL May 25, 2010 6:00 P.M. Mayor William D. Sessoms, Jr. called to order the FORMAL SESSION of the VIRGINL4 BEACH CITY COUNCIL in the Council Chamber, City Hall Building, on Tuesday, May 25, 2010, at 6:00 P.M. Council Members Present: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood. Council Members Absent: None INVOCATION: Reverend Clark Dennis Cundiff Pastor, Nimmo United Methodist Church PLEDGE OF ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA The National Anthem Solo: Little Miss Alana Springsteen Miss Springsteen has sung for the Norfolk Tides, Norfolk Admirals, Rock N' Roll half Marathon, Governor Robert McDonnell Inaugural Balls, and is scheduled to sing for the Chicago Cubs in Historic Wrigley Field on July 17th. Mayor Sessoms DISCLOSED as an officer of TowneBank (which has a corporate office located at 297 Constitution Drive in Virginia Beach), he is directly and indirectly involved in many of TowneBank's transactions. However, due to the size of TowneBank and the volume of transactions it handles, TowneBank has an interest in numerous matters in which he is not personally involved and of which he does not have personal knowledge. In that regard, he is always concerned about the appearance of impropriety that might arise if he unknowingly participates in a matter before City Council in which TowneBank has an interest. Mayor Sessoms also has similar concerns with respect to Prudential Towne Realty, which is an affiliate of TowneBank. In order to ensure his compliance with both the letter and spirit of the State and Local Government Conflict of Interests Act (the "Act"), it is his practice to thoroughly review each City Council agenda to idents any matters in which he might have an actual or potential conflict. If during his review of an agenda, he identifies a matter in which he has a `personal interest", as defined by the Act, he will either abstain from voting, or file the appropriate disclosure letter with the City Clerk to be included in the official records of City Council. Mayor Sessoms' letter of March 24, 2009, is hereby made a part of the record. May 25, 2010 -21- Vice Mayor Jones DISCLOSED, for many years, he served on the Board of Directors of Resource Bank. Three (3) years ago, Fulton Financial Corporation ("Fulton Financial') purchased Resource Bank. On March 31, 2007, Vice Mayor Jones retired from the Board of Directors. Although, he is no longer a Board Member, he owns stock in Fulton Financial and that stock ownership causes him to have a "personal interest" in Fulton Financial. However, due to the size of Fulton Financial and the volume of transactions it handles in any given year, Fulton Financial, or any of the banks that are owned by Fulton Financial, may have an interest in numerous matters in which Vice Mayor Jones has no personal knowledge. In order to ensure his compliance with both the letter and the spirit of the State and Local Government Conflict of Interests Act, it is his practice to thoroughly review the agenda for each meeting of City Council for the purpose of identifying any matters in which he might have an actual or potential conflict. If, during his review, he identifies any matters, Vice Mayor Jones will prepare and file the appropriate disclosure letter to be recorded in the official records of City Council. Vice Mayor Jones regularly makes this disclosure. Vice Mayor Jones' letter of April 10, 2007, is hereby made a part of the record. Council Lady Rosemary Wilson DISCLOSED her husband is a principal in the accounting firm of Goodman and Company and is directly and indirectly involved in many of Goodman and Company's transactions. However, due to the size of Goodman and Company and the volume of transactions it handles in any given year, Goodman and Company has an interest in numerous matters in which her husband is not personally involved and of which she does not have personal knowledge. In order to ensure her compliance with both the letter and the spirit of the State and Local Government Conflict of Interests Act, it is her practice to thoroughly review the agenda for each meeting of City Council for the purpose of identifying any matters in which she might have an actual or potential conflict. If, during her review she identifies any matters, she will prepare and file the appropriate disclosure letter to be recorded in the official records of City Council. Council Lady Wilson regularly makes this disclosure. Council Lady Wilson 's letter of January 27, 2004, is hereby made a part of the record. Council Lady Rosemary Wilson DISCLOSED she is a Real Estate Agent affiliated with Prudential Decker Realty. Because of the nature of Real Estate Agent affiliation, the size of Prudential, and the volume of transactions it handles in any given year, Prudential has an interest in numerous matters in which she is not personally involved and of which she does not have personal knowledge. In order to ensure her compliance with both the letter and the spirit of the State and Local Government Conflict of Interests Act, it is her practice to thoroughly review the agenda for each meeting of City Council for the purpose of identifying any matters in which she might have an actual or potential conflict. If, during her review she identifies any matters, she will prepare and file the appropriate disclosure letter to be recorded in the official records of City Council. Council Lady Wilson regularly makes this disclosure. Council Lady Wilson 's letter of January 27, 2004, is hereby made a part of the record. May 25, 2010 Item V --E.1 CERTIFICATION - 22 - ITEM # 59968 Upon motion by Councilman Wood, seconded by Council Lady Wilson, City Council CERTIFIED THE CLOSED SESSION TO BE IN ACCORDANCE WITH THE MOTION TO RECESS. Only public business matters lawfully exempt from Open Meeting requirements by Virginia law were discussed in Closed Session to which this certification resolution applies. AND, Only such public business matters as were identified in the motion convening the Closed Session were heard, discussed or considered by Virginia Beach City Council. Voting: 10-0 Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Abstaining: Robert M. Dyer Council Members Absent: None Councilman Dyer ABSTAINED, as he was ill and not in attendance for the Closed Session. May 25, 2010 1 RESOLUTION CERTIFICATION OF CLOSED SESSION VIRGINIA BEACH CITY COUNCIL WHEREAS: The Virginia Beach City Council convened into CLOSED SESSION, pursuant to the affirmative vote recorded in ITEM #59967, Page 19, and in accordance with the provisions of The Virginia Freedom of Information Act, and, WHEREAS: Section 2.2-3712 of the Code of Virginia requires a certification by the governing body that such Closed Session was conducted in conformity with Virginia law. NOW, THEREFORE, BE IT RESOLVED: That the Virginia Beach City Council hereby certifies that, to the best of each member's knowledge, (a) only public business matters lawfully exempted from Open Meeting requirements by Virginia law were discussed in Closed Session to which this certification resolution applies; and, (b) only such public business matters as were identified in the motion convening this Closed Session were heard, discussed or considered by Virginia Beach City Council. uth Hodges Fraser, MMC City Clerk May 25, 2010 Item V -F.1 - 23 - ITEM # 59969 Upon motion by Councilman Dyer, seconded by Council Lady Wilson, City Council APPROVED the MINUTES of the INFORMAL and FORMAL SESSIONS of May 11, 2010. Voting: 10-0 Council Members Voting Aye: Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Abstaining: Rita Sweet Bellitto Council Members Absent: None Council Lady Bellitto ABSTAINED as she was not in attendance during the City Council Session of May 11, 2010. Her father, John W. "Jack" Sweet, Sr., passed away on Friday, May 7, 2010. Funeral was in Pennsylvania on May 11, 2010 May 25, 2010 - 24 - Item V -G1. ADOPT AGENDA FOR FORMAL SESSION ITEM # 59970 BY CONSENSUS, City Council ADOPTED: AGENDA FOR THE FORMAL SESSION May 25, 2010 - 25 - Item V -H.1. MAYOR'S PRESENTATION RESOLUTION IN RECOGNITION ITEM # 59971 Mayor Sessoms PRESENTED: RESOLUTION IN RECOGNITON TO GREEN RUN HIGH SCHOOL "INSPIRATION AWARD" Five (5) representatives were in attendance to accept the Resolution: Dr. George Parker, III Principal Green Run High School Anne Midyette Teacher Sharon Walker Teacher Keenan Williams Kaitlyn Crowe Students Each Spring the College Board presents the Inspiration Award to three of America's most improved secondary schools, that are recognized for their outstanding college preparation programs and partnerships among teachers, parents and community organizations; This year Green Run High School has been selected as a recipient of the Inspiration Award that includes a cash prize of $25, 000 to help further their goal of helping economically challenged students attend college; Green Run High School has been dedicated to improving its academic environment and helping a significant percentage of Seniors realize the promise of a higher education by increasing the number of minority students taking Advanced Placement and other Advanced Level Courses; and, The academic rigor of students enrolled in Advanced Classes, the Advanced Via Individual Determination Program (AVID), the mentoring, tutoring and remediation programs that have been implemented to support minority students and recognize achievement were major factors in Green Run High School's selection. The City Council of the City of Virginia Beach commends and congratulates the Principal, Teachers, Staff, Parents and Students of Green Run High School on receiving the Inspiration Award and for their dedication and commitment to higher education for students facing economic, social and cultural barriers. May 25, 2010 3th�ntuIthn '4'%E EAS, Each Spring the Coll.ege Board presents the Inspiration Award to three of America's most improved secondary schools, that are recognized for their outstanding college - preparation programs andpartnerships among teachers, parents and community organizations; WJPER,EAS, This year Green 4jin Nigh School. has been selected as a recipient of the Inspiration Award that includes a cash prize of $25, 000 to help further their goal. of helping economically challenged students attend college; 14/YEWS, Green gOin 7figh School has been dedicated to improving its academic environment and helping a significant percentage of Seniors realize the promise of a higher education by increasing the number of minority students taking Advanced Pl.acement and other advanced level courses; and, "4VJZnEcRE1S, �c acudEmic rigor or students enrolled in advanced classes, theAdvanced (lie. Individual Determination Program O VIDD), the mentoring, tutoring and remediation programs that have been implemented to support minority students and recognize achievement were major factors in Green q j n 5figh School's selection. NO'W, TfflEKTEUXE, BE IT RESOLVED : That the City Council of the City of 'Virginia Beach 'commends and congratulates the ThincipaC Teachers, Staff, Barents ancfStudents of green tin Lfigh School- on receiving the Inspiration Award and for their dedication and commitment to higher education for students facing economic, social and cultural barriers. Given under our hands this 25°E day of Way 2010. 5. Council Lady Rita Sweet Bellitto � 1 Cour Councilman Glenn,R., Davis Councizna Couricibnan Robert airy Councit.fd.3� Barbara nan John E. 'fibrin Council L' ady Rose r • ry Wilson � Cour titin n Jaynes L. 'Wood MMlayor'Willianz D. "'Will' Sessorns, Jr. - 26 - Item V -H.1. MAYOR'S PRESENTATION RESOLUTION IN RECOGNITION ITEM # 59972 Mayor Sessoms PRESENTED: RESOLUTION IN RECOGNITON TO GLORIA WINKLER, MMC Senior Deputy City Clerk Gloria G. Winkler has been employed by the City of Virginia Beach in the City Clerk's Office since July 2001. During that time she has been an exemplary employee tackling the myriad of duties associated with the office in an efficient and effective manner. Gloria is a member of the International Institute of Municipal Clerks (IIMC) and the Virginia Municipal Clerk's Association (VMCA). IIMC, VMCA and the City Clerk recognize the importance of continuing education to the development and enhancement of professional Clerks. Yearly the Old Dominion University, Department of Continuing Studies, sponsored by VMCA, holds an Institute and Academy in Virginia Beach to provide educational credit to Municipal Clerks from across the state and neighboring states. These are rigorous college level courses that require hard work and dedication to complete. The Student must prepare a comprehension component to ascertain how the student perceived the class and how they will put what has been learned into practice in their locality. Gloria received her designation as a Certified Municipal Clerk in March of 2000. She continued to take advance courses and received her Master Municipal Clerk's designation in May 2009. May 25, 2010 LwLuthrn WJ{EREAS, y%ria S. Winkler has been employed 6y the City of 2'irginia Beach in the City Clerk's Office since July 2001. During that time she has been an exemplary employee tackling the myriad of duties associated with the office in an efficient and effective manner, WHEREAS, Gloria is a member of the Internationallnstitute of Municipal Clerks (71MC) and the Ziirginia Municipal Clerk's Association (MICA); WXErRrEAS, the City Cferk,IIMC, and vMCA recognize the importance of continuing education to the development and enhancement of professional Clerks. Annually, the Oki -Dominion 'University Department of Continuing Education, sponsored 6y II9KC in cooperation with 4'MCA, holds an Institute andAcademy in Virginia Beach to provide education credit to Clerks from across the Commonwealth and neighboring states. Mese are rigorous college level courses that require hard workand dedication to complete. The Clerkmust prepare a Comprehension Component to attest to the educational value, how the student perceived the class and how they will put into practice what has been learned; and WOEREAS, Gloria received her designation as a Certified lunicipa(Clerkin March 2000. She continued to take advanced courses and received her %taster Municipal Clerk's designation in May 2009. WO` i' 71PEEFOR , BE ITRESOLVED : That the City Council of tfie City of Virginia Beach commends Gthria S. Winkler, Senior Deputy City Clerk for her efforts in furthering her professional education and congratulates her on achieving the highest status given. 6y the International lnstitute ofMunu:ipalClerks, the Waster 9unicipa(Clerk. Given under our hands this 25th day of May 2010. 57,0-ke;p3S.,.11 CouncilLady Rita Sweet Bellitto Coni Councilman Glenn R cDavu Councilman Po6ert Councilllady,13arbara Ile nan John E. vhrin Council Lady 1posei(ry Wilson Com n james L. 'Wood 7vlavor William D. ` 'iOC Sessoms, Jr. Item V -I.1. PUBLIC BID OPENING AWARD LICENSE WESTIN TOWER at Town Center -27- ITEM # 59973 Mayor Sessoms announced a Public Bid Opening to Award License: Sub -License of City Property — 4535 Commerce Street (Westin Tower): "Pursuant to Virginia Code Section 15.2-2102, the Chair will now summarize the bids that have been received for a proposed sub -license of a portion of the City property located underneath the spire on top of the Westin Tower at 4535 Commerce Street for use as a radio telecommunications facility. One bid has been received, as follows: Liberty University has bid: Base rent: Annual increase: $25,800 per year 3% Are there any other persons desiring to submit a bid at this time? There being no further bids, the bidding is closed. The staff will evaluate the bid that has been received and make its recommendations to the City Council concerning the proposed sub -license at a future meeting." May 25, 2010 i -28- Item V -J.1. PUBLIC HEARING ITEM # 59974 Mayor Sessoms DECLARED A PUBLIC HEARING: INSTALLMENT PURCHASE AGREEMENTS Acquisition of Agricultural Land Preservation (ARP) Easements 756 and 772 Princess Anne Road There being no speakers, Mayor Sessoms CLOSED THE PUBLIC HEARING May 25, 2010 1 - 29 - Item V -J.2. PUBLIC HEARING ITEM # 59975 Mayor Sessoms DECLARED A PUBLIC HEARING: LEASE OF CITY -OWNED PROPERTY a. 3rd Street and Atlantic Avenue b. T -Mobile Northeast, LLC - 616 North Great Neck Road There being no speakers, Mayor Sessoms CLOSED THE PUBLIC HEARING May 25, 2010 1 - 30 - Item V -J.3. PUBLIC HEARING ITEM # 59976 Mayor Sessoms DECLARED A PUBLIC HEARING: SALE OF EXCESS PROPERTY 2278 Wolf Street There being no speakers, Mayor Sessoms CLOSED THE PUBLIC HEARING May 25, 2010 - 31 - Item V -J.4. PUBLIC HEARING ITEM # 59977 Mayor Sessoms DECLARED A PUBLIC HEARING: PPEA PROPOSAL Adoption Friendly Animal Shelter Juliana Pontone, 1232 Carlson Lane, Phone: 272-7252, represented the Friends of Virginia Beach Animal Control and expressed appreciation for funding a new facility. Debra Griggs, Treasurer — Virginia Federation of Humane Societies, 111 South Arden Circle, Norfolk 23505, Phone: 725-1705, expressed appreciation and stated the City is setting a standard for other municipalities across the Commonwealth. Bobbie Gribble, President — Animal Rescue of Tidewater, 820 Jennings Street, Phone: 420-7677, expressed appreciation for approving the Budget, which included the Virginia Beach Animal Care and Adoption Center. There being no further speakers, Mayor Sessoms CLOSED THE PUBIC HEARING. May 25, 2010 -32 - Item L. ORDINANCES/RESOLUTIONS ITEM # 59978 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council APPROVED in ONE MOTION Items 1.1, 2a/b/, 3, 4, 5a/b, 6, 7, 8, 9, 10, 11, 12, 13, 14 and 15 of the CONSENT AGENDA. Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None Councilman DeSteph will ABSTAIN, on Items 5a/b (Agricultural Land Preservation (ARP) easements to Whale Wallow, L.C.) and 13 (Agricultural Reserve Program (ARP) Special Revenue Fund to cover the costs for the purchase of various agricultural land preservation easements) May 25, 2010 - 33 - Item L.1. ORDINANCES/RESOLUTIONS ITEM # 59979 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to AMEND Section 5-401 of the City Code re fees for the impoundment, spaying or neutering of animals Voting.• 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 1 AN ORDINANCE TO AMEND CITY CODE SECTION 5- 2 401 PERTAINING TO FEES FOR THE IMPOUNDMENT 3 OF ANIMALS, GENERALLY 4 SECTION AMENDED: § 5-401 5 BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF VIRGINIA BEACH, 6 VIRGINIA: 7 That Section 5-401 of the Code of the City of Virginia Beach, Virginia is hereby 8 amended and reordained to read as follows: 9 10 Sec. 5-401. Fees for the impoundment of animals, generally. 11 12 .... 13 14 (d) Any person adopting an animal spayed or neutered at the expenses of the City 15 shall also incur an additional cost of one hundred dollars ($100.00) for dogs, and forty dollars 16 ($40.00) for cats. In the event sterilization services are not available from the City, any person 17 adopting an unaltered animal will be required to deposit an additional one hundred dollars 18 ($100.00) for dogs, and forty dollars ($40.00) for cats which shall be reimbursed if proof of 19 sterilization is presented to the bureau of animal control within thirty (30) days of the adoption. 20 21 (d) (e) The person desiring to adopt the animal shall sign an adoption contract agreeing 22 to abide by the rules and regulations of the bureau of animal control. 23 24 25 26 27 28 adoptie-n, BE IT FURTHER ORDAINED: That the effective date of this ordinance shall be July 1, 2010. Adopted by the Council of the City of Virginia Beach, Virginia, on this 25th day of May , 2010. Approved as to Content Manag- en Services CA11463 R-1 May 14, 2010 Approved as to Legal Sufficiency - 34 - Item L.2.a/b. ORDINANCES/RESOLUTIONS ITEM # 59980 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Resolutions re Water and Sewer Bonds: a. AUTHORIZE Refunding Bonds, Series of 2010, not to exceed $125 -Million b. Ninth Supplemental Master Water and Sewer Revenue Bond Resolution of February 11, 1992 Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 I II CERTIFICATE OF RESOLUTION The undersigned City Clerk of the City of Virginia Beach, Virginia (the "City"), certifies that: 1. A regular meeting of the Council of the City (the "Council") was held onMa y 2 5 2010, at which the following members were present and absent: PRESENT: Rita Sweet Bellito Glen R. Davis Bill R. DeSteph Harry E. Diezel Robert M. Dyer Barbara M. Henley Louis R. Jones William D. Sessoms John E. Uhrin Rosemary Wilson James L. Wood ABSENT: None 2. A resolution entitled "Resolution Authorizing the Distribution of a Preliminary Official Statement and Other Actions in Connection with the Issuance by the City of Virginia Beach, Virginia, of its Water and Sewer System Revenue and Refunding Bonds, Series of 2010," was adopted by an affirmative roll call vote of a majority of all members of the Council, the ayes and nays being recorded in the minutes of the meeting as shown below: MEMBER VOTE Rita Sweet Bellito AYE Glen R. Davis AYE Bill R. DeSteph AYE Harry E. Diezel AYE Robert M. Dyer AYE Barbara M. Henley AYE Louis R. Jones AYE William D. Sessoms AYE John E. Uhrin AYE Rosemary Wilson AYE James L. Wood AYE 3. Attached hereto is a true and correct copy of such resolution as recorded in the minutes of such meeting of the Council held on May 25, 2010. 4. This resolution has not been repealed, revoked, rescinded or amended and is in full force and effect on the date hereof. RESOLUTION AUTHORIZING THE DISTRIBUTION OF A PRELIMINARY OFFICIAL STATEMENT AND OTHER ACTIONS IN CONNECTION WITH THE ISSUANCE BY THE CITY OF VIRGINIA BEACH, VIRGINIA, OF ITS WATER AND SEWER SYSTEM REVENUE AND REFUNDING BONDS, SERIES OF 2010 WHEREAS, the City of Virginia Beach, Virginia (the "City"), proposes to issue its Water and Sewer System Revenue and Refunding Bonds, Series of 2010, in an amount not to exceed $125,000,000 (the "Bonds"), pursuant to the Ninth Supplemental Resolution amending the City's Master Water and Sewer Bond Resolution, originally adopted February 11, 1992, as amended from time to time thereafter (the "Ninth Supplemental Resolution"); WHEREAS, in connection with the adoption by the Council of the City (the "City Council") of the Ninth Supplemental Resolution, there have been presented to or otherwise made available to this meeting drafts of the following documents: (a) Notices of Sale, drafts dated May 14, 2010 (collectively, the "Notice of Sale"), of the City relating to the advertisement of the public offering of the Bonds; (b) Preliminary Official Statement, draft dated May 14, 2010 (the "Preliminary Official Statement"), of the City relating to the public offering of the Bonds; and (c) Continuing Disclosure Agreement, draft dated May 14, 2010, pursuant to which the City agrees to undertake continuing disclosure obligations pursuant to Rule 15c2-12 (the "Rule") promulgated by the Securities and Exchange Commission (the "SEC") for the benefit of the holders of the Bonds; NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF VIRGINIA BEACH, VIRGINIA, AS FOLLOWS: 1. The City Manager, in collaboration with Government Finance Associates, Inc., the City's financial advisor (the "Financial Advisor"), is authorized and directed to take all proper steps to advertise the Bonds for sale substantially in accordance with the form of Notice of Sale attached hereto, which is approved, provided that the City Manager, in collaboration with the Financial Advisor, may make such changes in the Notice of Sale not inconsistent with this Resolution as he may consider to be in the best interest of the City. 2. The City authorizes the distribution of the Preliminary Official Statement in form deemed "near final" as of its date, within the meaning of the Rule of the SEC, to prospective purchasers of the Bonds, with such completions, omissions, insertions and changes as may be approved by the City Manager. Such distribution shall constitute conclusive evidence of the approval of the City Manager as to any such completions, omissions, insertions and changes and that the City has deemed the Preliminary Official Statement to be near final as of its date. 3. The City Manager, in collaboration with the Financial Advisor, is hereby authorized and directed to approve such completions, omissions, insertions and other changes to the Preliminary Official Statement necessary to reflect the terms of the sale of the Bonds and the details thereof appropriate to complete it as an official statement in final form (the "Official Statement") and to execute and deliver the Official Statement to the purchasers of the Bonds. Execution of the Official Statement by the City Manager shall constitute conclusive evidence of his approval of any such completions, omissions, insertions and changes and that the Official Statement has been deemed final by the City as of its date within the meaning of the Rule. 4. The Mayor, the City Manager and such officer or officers of the City as either may designate, any of whom may act, are hereby authorized and directed to execute the Continuing Disclosure Agreement, the form of which is approved, with such completions, omissions, insertions and changes that are not inconsistent with this Resolution. 5. The officers of the City are hereby authorized and directed to execute, deliver and file all certificates and documents and to take all such further action as they may consider necessary or desirable in connection with the issuance and sale of the Bonds, including without limitation (a) execution and delivery of a certificate setting forth the expected use and investment of the proceeds of the Bonds to show that such expected use and investment will not violate the provisions of Section 148 of Code, and regulations thereunder, applicable to "arbitrage bonds," (b) making any elections that such officers deem desirable regarding any provision requiring rebate to the United States of "arbitrage profits" earned on investment of proceeds of the Bonds, and (c) filing Internal Revenue Service Form 8038-G and, for any Bonds issued as "build America bonds" within the meaning of Section 54AA of the Code, Internal Revenue Service Form 8038-B. The foregoing shall be subject to the advice, approval and direction of bond counsel. 6. Any authorization herein to execute a document shall include authorization to deliver it to the other parties thereto. 7. All other acts of the officers of the City that are in conformity with the purposes and intent of this Resolution and in furtherance of the issuance and sale of the Bonds are hereby approved and ratified. 8. This Resolution shall take effect immediately. Adopted by the Council of the City of Virginia Beach, Virginia, on the 25th day of May, 2010. APPROVED AS TO CONTENT: inance D partment a APPROVED AS TO LEGAL SUFFICIENCY: City Att ey's Office WITNESS my signature and the seal of the City of Virginia Beach, Virginia, this day of May, 2010. City Clerk, City of Virginia Beach, Virginia (SEAL) CITY OF VIRGINIA BEACH, VIRGINIA NINTH SUPPLEMENTAL RESOLUTION SUPPLEMENTING AND AMENDING RESOLUTION ADOPTED FEBRUARY 11, 1992, ENTITLED "MASTER WATER AND SEWER REVENUE BOND RESOLUTION PROVIDING FOR THE ISSUANCE FROM TIME TO TIME OF ONE OR MORE SERIES OF WATER AND SEWER SYSTEM REVENUE BONDS OF THE CITY OF VIRGINIA BEACH," AS PREVIOUSLY SUPPLEMENTED AND AMENDED, TO PROVIDE FOR THE ISSUANCE AND SALE OF UP TO $125,000,000 OF WATER AND SEWER SYSTEM REVENUE AND REFUNDING BONDS, SERIES OF 2010, AND PROVIDING FOR THE FORM, DETAILS AND PAYMENT THEREOF AND THE FINANCING OF THE COST OF IMPROVEMENTS TO THE CITY'S WATER AND SANITARY SEWER FACILITIES ADOPTED ON , 2010 I TABLE OF CONTENTS Page ARTICLE I NINTH SUPPLEMENTAL RESOLUTION Section 9.101 Ninth Supplemental Resolution. 1 Section 9.102 Meaning of Terms; Definitions 2 Section 9.103 Reference to Articles and Sections 3 ARTICLE II 2010 PROJECT Section 9.201 Authorization of 2010 Project 3 ARTICLE III ISSUANCE AND SALE OF SERIES 2010 BONDS Section 9.301 Issuance and Sale of Series 2010 Bonds. 3 Section 9.302 Details of Series 2010 Bonds. 4 Section 9.303 Book Entry System. 5 Section 9.304 Registrar. 6 Section 9.305 Form of Series 2010 Bonds 6 Section 9.306 Security for Series 2010 Bonds 6 Section 9.307 Application of Proceeds. 6 ARTICLE IV REDEMPTION OF SERIES 2010 BONDS Section 9.401 Optional Redemption Provisions. 7 Section 9.402 Mandatory Redemption. 7 Section 9.403 Extraordinary Optional Redemption of Taxable Bonds Due to Loss of Build America Bond Status. 7 Section 9.404 Selection of Series 2010 Bonds for Redemption. 8 Section 9.405 Notice of Redemption. 9 ARTICLE V FEDERAL TAX PROVISIONS Section 9.501 Limitation of Use of Proceeds. 9 Section 9.502 Rebate Requirement. 10 Section 9.503 Calculation and Payment of Rebate Amount. 11 ARTICLE VI AMENDMENTS TO MASTER RESOLUTION Section 9.601 Effective Date of Amendment. 11 Section 9.602 Amendment to Section 101 12 ARTICLE VII MISCELLANEOUS Section 9.701 Limitation of Rights. 12 Section 9.702 SNAP Investment 12 (i) Section 9.703 Section 9.704 Appendix A - Appendix B - Appendix C - Appendix D - Severability. Effective Date. 13 13 Description of the 2010 Project A-1 Form of the Tax -Exempt Bonds B-1 Form of the Taxable Bonds C-1 D-1 Notice to Bondholders NINTH SUPPLEMENTAL RESOLUTION SUPPLEMENTING AND AMENDING RESOLUTION ADOPTED FEBRUARY 11, 1992, ENTITLED "MASTER WATER AND SEWER REVENUE BOND RESOLUTION PROVIDING FOR THE ISSUANCE FROM TIME TO TIME OF ONE OR MORE SERIES OF WATER AND SEWER SYSTEM REVENUE BONDS OF THE CITY OF VIRGINIA BEACH," AS PREVIOUSLY SUPPLEMENTED AND AMENDED, TO PROVIDE FOR THE ISSUANCE AND SALE OF UP TO $125,000,000 OF WATER AND SEWER SYSTEM REVENUE AND REFUNDING BONDS, SERIES OF 2010, AND PROVIDING FOR THE FORM, DETAILS AND PAYMENT THEREOF AND THE FINANCING OF THE COST OF IMPROVEMENTS TO THE CITY'S WATER AND SANITARY SEWER FACILITIES WHEREAS, the Council (the "Council") of the City of Virginia Beach, Virginia (the "City"), adopted a resolution on February 11, 1992 (the "Master Resolution"), providing for the issuance from time to time of water and sewer revenue bonds to finance the cost of improvements and extensions to its water and sanitary sewer system; and WHEREAS, the Council desires to issue pursuant to the Master Resolution up to $13,344,201 of the $16,997,000 water and sewer system revenue bonds authorized by an ordinance adopted by the Council on May 10, 2005, up to $18,950,465 of the $18,950,465 water and sewer system revenue bonds authorized by an ordinance adopted by the Council on May 9, 2006, up to $18,793,000 of the $18,793,000 water and sewer system revenue bonds authorized by an ordinance adopted by the Council on May 15, 2007, up to $13,000,000 of the $13,000,000 water and sewer system revenue bonds authorized by an ordinance adopted by the Council on May 13, 2008, up to $912,334 of the $17,000,000 water and sewer system revenue bonds authorized by an ordinance adopted by the Council on May 12, 2009, and to sell such bonds in one or more issues in a collective amount equal to $65,000,000; and WHEREAS, the Council desires to refund all or a portion of the City's Water and Sewer System Revenue Bonds, Series of 2002, and all or a portion of the City's Water and Sewer System Revenue and Refunding Bonds, Series of 2005; and WHEREAS, the City is not in default under the Master Resolution or in payment of the principal of or interest on the Outstanding Bonds (as defined in the Master Resolution); BE IT RESOLVED BY THE COUNCIL OF THE CITY OF VIRGINIA BEACH, VIRGINIA: ARTICLE I NINTH SUPPLEMENTAL RESOLUTION Section 9.101 Ninth Supplemental Resolution. This Ninth Supplemental Resolution is adopted pursuant to and in accordance with Section 1101(g) of the Master Resolution. All covenants, conditions and agreements of the II I Master Resolution shall apply with equal force and effect to the Series 2010 Bonds (as hereinafter defined) and to the holders thereof, except as otherwise provided herein. Section 9.102 Meaning of Terms; Definitions. All capitalized terms used herein and not defined either in this Section or elsewhere in this Ninth Supplemental Resolution (including the recitals hereto), shall have the meanings ascribed to such terms in the Master Resolution. The following terms shall have the following meanings in this Ninth Supplemental Resolution. "2002 Refunded Bonds" shall mean all or a portion of the outstanding principal amount of the City's $28,000,000 Water and Sewer System Revenue Bonds, Series of 2002, being refunded with a portion of the proceeds of the Series 2010 Bonds. "2005 Refunded Bonds" shall mean all or a portion of the outstanding principal amount of the City's $92,700,000 Water and Sewer System Revenue and Refunding Bonds, Series of 2005, being refunded with a portion of the proceeds of the Series 2010 Bonds. "2010 Project" shall mean the acquisitions, improvements, extensions, additions and replacements to the System as described in Article II. "DTC" shall mean The Depository Trust Company, New York, New York, a securities depository, as holder of the Series 2010 Bonds, or its successors or assigns in such capacity. "Escrow Agent" shall mean The Bank of New York Mellon Trust Company, N.A., as escrow agent for the Refunded Bonds. "Escrow Deposit Agreement" shall mean the Escrow Deposit Agreement between the City and the Escrow Agent. "Escrow Fund" shall mean the fund established by the Escrow Deposit Agreement. "Ninth Supplemental Resolution" shall mean this Ninth Supplemental Resolution, which supplements the Master Resolution. "Rebate Amount" shall mean the excess of (a) the future value of all nonpurpose receipts with respect to the Series 2010 Bonds over (b) the future value of all nonpurpose payments with respect to the Series 2010 Bonds, in each case calculated under Section 9.503 pursuant to the requirements of Section 148 of the Code, or such other amount of arbitrage required to be rebated to the United States of America under Section 148 of the Code. "Rebate Amount Certificate" shall have the meaning set forth in Section 9.503. "Refunded Bonds" shall mean the 2002 Refunded Bonds and the 2005 Refunded Bonds. "Registrar" shall mean The Bank of New York Mellon Trust Company, N.A., as paying agent and bond registrar for the Series 2010 Bonds. 2 "Series 2010A Bonds" shall mean the Water and Sewer System Revenue Bonds, Series of 2010A, in the amount to be issued in accordance with the provisions of Article III. "Series 2010B Bonds" shall mean the Water and Sewer System Refunding Revenue Bonds, Series of 2010B (Tax -Exempt), in the amount to be issued in accordance with the provisions of Article III. "Series 2010C Bonds" shall mean the Water and Sewer System Refunding Revenue Bonds, Series of 2010C (Tax -Exempt), in the amount to be issued in accordance with the provisions of Article III. "Taxable Bonds" shall mean any portion of the Series 2010A Bonds issued as taxable Build America Bonds. "Tax -Exempt Bonds" shall mean the Series 2010B Bonds, the Series 2010C Bonds, and any portion of the Series 2010A Bonds issued as tax-exempt bonds. Section 9.103 Reference to Articles and Sections Unless otherwise indicated, all references herein to particular articles or sections are references to articles or sections of this Ninth Supplemental Resolution. ARTICLE II 2010 PROJECT Section 9.201 Authorization of 2010 Project. The Council has authorized the acquisitions, improvements, extensions, additions and replacements to the System described on Appendix A, which are part of the approved capital improvement program of the City. ARTICLE III ISSUANCE AND SALE OF SERIES 2010 BONDS Section 9.301 Issuance and Sale of Series 2010 Bonds. The City hereby provides for the issuance of water and sewer system revenue bonds in a principal amount up to $65,000,000, consisting of up to $13,344,201 of the $16,997,000 water and sewer system revenue bonds authorized by an ordinance adopted by the Council on May 10, 2005, up to $18,950,465 of the $18,950,465 water and sewer system revenue bonds authorized by an ordinance adopted by the Council on May 9, 2006, up to $18,793,000 of the $18,793,000 water and sewer system revenue bonds authorized by an ordinance adopted by the Council on May 15, 2007, up to $13,000,000 of the $13,000,000 water and sewer system revenue bonds authorized by an ordinance adopted by the Council on May 13, 2008, up to $912,334 of the $17,000,000 water and sewer system revenue bonds authorized by an ordinance adopted by the Council on May 12, 2009, which such bonds shall be issued and sold pursuant hereto. The 3 proceeds thereof shall be used to refund the Refunded Bonds and pay the Cost of the 2010 Project. All such bonds shall constitute Bonds, as defined in the Master Resolution. Section 9.302 Details of Series 2010 Bonds. (a) Subject to the provisions of paragraph (f) below, the Series 2010A Bonds shall be designated "Water and Sewer System Revenue Bonds, Series of 2010A," shall be issued in one or more subseries designated A-1 upward, shall be numbered R-1 upward, shall be dated, shall be in an aggregate principal amount not to exceed $65,000,000, shall bear interest at rates, payable semiannually on such dates and shall mature in installments on such dates and in years and amounts, all as determined by the City Manager to be in the best interest of the City. (b) Subject to the provisions of paragraph (f) below, the Series 2010B Bonds shall be designated "Water and Sewer System Refunding Revenue Bonds, Series of 2010B (Tax - Exempt)," shall be numbered R-1 upward, shall be dated, shall be, together with the Series 2010C Bonds, in an aggregate principal amount not to exceed $60,000,000, shall bear interest at rates, payable semiannually on such dates and shall mature in installments on such dates and in years and amounts, all as determined by the City Manager to be in the best interest of the City. (c) Subject to the provisions of paragraph (f) below, the Series 2010C Bonds shall be designated "Water and Sewer System Refunding Revenue Bonds, Series of 2010C (Tax - Exempt)," shall be numbered R-1 upward, shall be dated, shall be, together with the Series 2010B Bonds, in an aggregate principal amount not to exceed $60,000,000, shall bear interest at rates, payable semiannually on such dates and shall mature in installments on such dates and in years and amounts, all as determined by the City Manager to be in the best interest of the City. (d) Principal of the Series 2010 Bonds and the premium, if any, thereon shall be payable to the holders upon the surrender of such Bonds at the principal corporate trust office of the Registrar. Interest on the Series 2010 Bonds shall be payable by check or draft mailed to the holders as of the 15th day of the month prior to each interest payment date, at their addresses as they appear on the registration books kept by the Registrar. (e) Except as otherwise provided herein, the Series 2010 Bonds shall be payable, executed, authenticated, registrable, exchangeable and secured, all as set forth in the Master Resolution. (f) The Bonds shall be sold by competitive bid, and the City Manager shall receive bids for the Bonds and award the Bonds to the bidder providing the lowest "true" or "Canadian" interest cost, subject to the following limitations. The Bonds shall (a) have a "true" or "Canadian" interest cost not to exceed 5.00% (taking into account any original issue discount or premium on the Bonds and taking into account any direct credit payments from the United States Treasury expected to be received for any Bonds issued as "build America bonds" within the meaning of Section 54AA of the Internal Revenue Code of 1986 (as amended) (the "Code")), (b) be sold to the purchaser at a price not less than 100.00% of the principal amount thereof and (c) mature no later than the year 2035. 4 Section 9.303 Book Entry System. Initially, one Series 2010 Bond certificate for each maturity will be issued to DTC, which is designated as the securities depository for the Series 2010 Bonds, or its nominee, and immobilized in its custody. Beneficial owners of the Series 2010 Bonds will not receive physical delivery of the Series 2010 Bonds. So long as DTC is acting as securities depository for the Series 2010 Bonds, a book entry system shall be employed, evidencing ownership of the Series 2010 Bonds in principal amounts of $5,000 or multiples thereof, with transfers of beneficial ownership effected on the records of DTC and its participants pursuant to rules and procedures established by DTC and its participants. Interest on the Series 2010 Bonds shall be payable in clearinghouse funds to DTC or its nominee as registered owner of the Series 2010 Bonds. Principal, premium, if any, and interest shall be payable in lawful money of the United States of America by the Registrar. Transfer of principal and interest payments to participants of DTC shall be the responsibility of DTC; transfer of principal and interest payments to beneficial owners by participants of DTC will be the responsibility of such participants and other nominees of beneficial owners. The City and the Registrar shall not be responsible or liable for maintaining, supervising or reviewing the records maintained by DTC, its participants or persons acting through such participants. In the event that (a) DTC determines not to continue to act as securities depository for the Series 2010 Bonds by giving notice to the City and the Registrar discharging its responsibilities hereunder, (b) the Registrar or the City determines that DTC is incapable of discharging its duties or that continuation with DTC as securities depository is not in the best interest of the City, or (c) the Registrar or the City determines that continuation of the book entry system of evidencing ownership and transfer of ownership of the Series of 2002 Bonds is not in the best interest of the City or the beneficial owners of the Series 2010 Bonds, the Registrar and the City shall discontinue the book entry system with DTC. If the Registrar or the City fails to identify another qualified securities depository to replace DTC, the Registrar shall authenticate and deliver replacement bonds in the form of fully registered certificates to the beneficial owners or to the DTC participants on behalf of beneficial owners, substantially in the form as set forth in Appendix B and Appendix C, as applicable, with such variations, omissions or insertions as are necessary or desirable in the delivery of replacement certificates in printed form. The Series 2010 Bonds would then be registrable and exchangeable as set forth in Section 204 of the Master Resolution. So long as DTC is the securities depository for the Series 2010 Bonds (a) it shall be the registered owner of the Series 2010 Bonds, (b) transfers of ownership and exchanges shall be effected on the records of DTC and its participants pursuant to rules and procedures established by DTC and its participants, and (c) references in this Ninth Supplemental Resolution to holders of the Series 2010 Bonds shall mean DTC or its nominee and shall not mean the beneficial owners of the Series 2010 Bonds. 5 Section 9.304 Registrar. The selection of The Bank of New York Mellon Trust Company, N.A. as paying agent and bond registrar for the Series 2010 Bonds is approved. Section 9.305 Form of Series 2010 Bonds. (a) The Tax -Exempt Bonds shall be in substantially the form set forth in Appendix B with such variations, omissions and insertions as may be necessary to set forth the details thereof pursuant to Article II of the Master Resolution and Article III hereof. (b) The Taxable Bonds shall be in substantially the form set forth in Appendix C with such variations, omissions and insertions as may be necessary to set forth the details thereof pursuant to Article II of the Master Resolution and Article III hereof. Section 9.306 Security for Series 2010 Bonds. The Series 2010 Bonds shall be issued pursuant to the Master Resolution and this Ninth Supplemental Resolution and shall be equally and ratably secured under and to the extent provided in the Master Resolution with the Prior Parity Bonds, any Bonds that may be issued under the Master Resolution, any Parity Double Barrel Bonds that may be issued and any Parity Debt Service Components that may be incurred, without preference, priority or distinction of any obligations over any other obligations; provided, however, the Debt Service Reserve Fund will secure only the Bonds. Section 9.307 Application of Proceeds. The proceeds of the Series 2010 Bonds shall be applied as follows: (a) The amount of Tax -Exempt Bond proceeds set forth in the Escrow Deposit Agreement shall be paid to the Escrow Agent and deposited in the Escrow Fund to be invested, together with available amounts transferred to the Escrow Fund from (i) the Interest Account and Principal Account in the Revenue Bond Fund with respect to the Refunded Bonds and (ii) available moneys from the debt service accounts established for the Refunded Bonds. Such amounts shall be used, together with interest earnings thereon, by the Escrow Agent for the sole purpose of paying principal, premium and interest on the Refunded Bonds and the Related Fees. (b) The amount of Series 2010 Bond proceeds necessary, together with amounts on deposit in the Debt Service Reserve Fund, to equal the Debt Service Reserve Requirement after the issuance of the Series 2010 Bonds shall be paid to the Fiscal Agent and deposited into the Debt Service Reserve Fund. (c) The balance of the proceeds shall be retained by the City and deposited in a General Account in the Construction Fund to be used to pay the Cost of the 2010 Project and to pay expenses incident to issuing the Series 2010 Bonds. 6 ARTICLE IV REDEMPTION OF SERIES 2010 BONDS Section 9.401 Optional Redemption Provisions. The Series 2010 Bonds may be subject to redemption prior to maturity at the option of the City on or after dates, if any, determined by the City Manager, in whole or in part at any time at redemption prices equal to the principal amount of the Series 2010 Bonds, together with any accrued interest to the redemption date, plus redemption premiums not to exceed 2% of the principal amount of the Series 2010 Bonds, as such redemption premiums may be determined by the City Manager. Section 9.402 Mandatory Redemption. The Series 2010 Bonds may be subject to mandatory sinking fund redemption prior to maturity in years and amounts, upon payment of 100% of the principal amount thereof to be redeemed plus interest accrued to the redemption date, as may be determined by the City Manager. Section 9.403 Extraordinary Optional Redemption of Taxable Bonds Due to Loss of Build America Bond Status. Prior to October 1, 2020, the Taxable Bonds are subject to redemption prior to their maturity at the option of the City, in whole or in part, upon the occurrence of an Extraordinary Build America Bond Event (as hereinafter defined) at a redemption price equal to the greater of: (i) 100% of the principal amount of the Taxable Bonds to be redeemed; and (ii) The sum of the present value of the remaining scheduled payments of principal and interest to the maturity date of the Taxable Bonds to be redeemed, not including any portion of those payments of interest accrued and unpaid as of the date on which the Taxable Bonds are to be redeemed, discounted to the date on which the Taxable Bonds are to be redeemed on a semi-annual basis, assuming a 360 -day year consisting of twelve 30 -day months, at the Treasury Rate (as hereinafter defined), plus 100 basis points; plus, in either case, accrued interest on such Taxable Bonds to be redeemed to the redemption date. An "Extraordinary Build America Bond Event" will have occurred if a material adverse change has occurred to Section 54AA or 6431 of the Code (as such Sections were added by Section 1531 of the Recovery Act, pertaining to `Build America Bonds") or there is any guidance published by the Internal Revenue Service or the United States Treasury with respect to such Sections or any other determination by the Internal Revenue Service or the United States Treasury, which determination is not the result of any act or omission by the City to satisfy the requirements to qualify to receive the Federal Subsidy from the United States Treasury, pursuant 7 II I to which the City's 35% Federal Subsidy from the United States Treasury is reduced or eliminated. "Treasury Rate" means, as of any redemption date, the yield to maturity as of such redemption date of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two Business Days prior to the redemption date (excluding inflation indexed securities) (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the redemption date to the maturity date of the Taxable Bonds to be redeemed; provided, however, that if the period from the redemption date to such maturity date is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used. The redemption price of such Taxable Bonds to be redeemed will be determined by an independent accounting firm, investment banking firm or financial advisor retained by the City to calculate such redemption price. The City may conclusively rely on the determination of such redemption price by such independent accounting firm, investment banking firm or financial advisor and will not be liable for such reliance. Section 9.404 Selection of Series 2010 Bonds for Redemption. If less than all of the Series 2010 Bonds of a Series are called for redemption, the Series 2010 Bonds of a Series to be redeemed shall be selected in such manner as the City Manager or the chief financial officer of the City may determine to be in the best interest of the City. If less than all of the Tax -Exempt Bonds of a particular maturity are called for redemption, the Tax -Exempt Bonds to be redeemed shall be selected by DTC or any successor securities depository pursuant to its rules and procedures or, if the book entry system is discontinued, shall be selected by the Registrar by lot in such manner as the Registrar at its discretion may determine. If less than all of the Taxable Bonds of a particular maturity are called for redemption, the particular Taxable Bonds to be redeemed shall be selected on a pro -rata basis. With respect to such Taxable Bonds sold, "pro rata" is determined, in connection with any mandatory sinking fund redemption or any optional redemption in part, by multiplying the principal amount of such maturity to be redeemed on the applicable redemption date by a fraction, the numerator of which is equal to the principal amount of the Taxable Bond of such maturity owned by the registered owner, and the denominator of which is equal to the total amount of the Taxable Bonds of such maturity then outstanding immediately prior to such redemption date, and then rounding the product down to the next lower integral multiple of $5,000; provided that the portion of any Taxable Bonds to be redeemed are required to be in authorized denominations and all Taxable Bonds of a maturity to remain outstanding following any redemption are required to be in authorized denominations. Notwithstanding the foregoing, if the Taxable Bonds are in book - entry form at the time of such redemption, the City shall instruct DTC to instruct the DTC participants to select the specific Taxable Bonds for redemption by lot within maturities among 8 Beneficial Owners, and the City shall not have any responsibility to ensure that DTC or the DTC participants properly select such Taxable Bonds for redemption. The portion of any Series 2010 Bond to be redeemed shall be in the principal amount of $5,000 or some multiple thereof. In selecting Series 2010 Bonds for redemption, each Series 2010 Bond shall be considered as representing that number of Series 2010 Bonds which is obtained by dividing the principal amount of such Series 2010 Bond by $5,000. If a portion of a Series 2010 Bond shall be called for redemption, a new Series 2010 Bond in principal amount equal to the unredeemed portion thereof shall be issued to the registered owner upon the surrender thereof. Section 9.405 Notice of Redemption. (a) The Registrar shall send notice of the call for redemption identifying the Series 2010 Bonds or portions thereof to be redeemed, not less than 30 nor more than 60 days prior to the redemption date, (1) by facsimile or electronic transmission, registered or certified mail or overnight express delivery, to the holder of each Series 2010 Bond to be redeemed at his address as it appears on the registration books kept by the Registrar, (2) by facsimile or electronic transmission, registered or certified mail or overnight express delivery, to all organizations registered with the Securities and Exchange Commission as securities depositories, and (3) to the Electronic Municipal Market Access (EMMA) system (established by the Municipal Securities Rulemaking Board) or any other nationally recognized municipal securities information repository designated as such by the Securities and Exchange Commission. (b) In the case of an optional redemption, the notice may state that (1) it is conditioned upon the deposit of moneys, in an amount equal to the amount necessary to effect the redemption, with an escrow agent no later than the redemption date or (2) the City retains the right to rescind such notice on or prior to the scheduled redemption date (in either case, a "Conditional Redemption"), and such notice and optional redemption shall be of no effect if such moneys are not so deposited or if the notice is rescinded as described herein. Any Conditional Redemption may be rescinded at any time prior to the redemption date, and the Registrar shall give prompt notice of such rescission to the affected Series 2010 Bondholders. Any Series 2010 Bonds subject to Conditional Redemption where redemption has been rescinded shall remain Outstanding, and the rescission shall not constitute an Event of Default. Further, in the case of a Conditional Redemption, the failure of the City to make funds available on or before the redemption date shall not constitute an Event of Default, and the Registrar shall give immediate notice to all organizations registered with the Securities and Exchange Commission as securities depositories or the affected Series 2010 Bondholders that the redemption did not occur and that the Series 2010 Bonds called for redemption and not so paid remain outstanding. ARTICLE V FEDERAL TAX PROVISIONS Section 9.501 Limitation of Use of Proceeds. The City covenants with the holders of the Series 2010 Bonds as follows: 9 (a) The City shall not take or omit to take any action or make any investment or use of the proceeds of any Series 2010 Bonds (including failure to spend the same with due diligence) the taking or omission of which would cause the Series 2010 Bonds of either Series to be "arbitrage bonds" within the meaning of Section 148 of the Code, including without limitation participating in any issue of obligations that would cause the Series 2010 Bonds of either Series to be part of an "issue" of obligations that are arbitrage bonds, within the meaning of Treasury Regulations Section 1.148-10 or successor regulation, or otherwise cause (i) interest on the Tax - Exempt Bonds to be includable in the gross income of the registered owners under existing law or (ii) the Taxable Bonds to lose their qualification as "build America bonds" (within the meaning of Section 54AA of the Code). Without limiting the generality of the foregoing, the City shall comply with any provision of law that may require the City at any time to rebate to the United States of America any part of the earnings derived from the investment of gross proceeds of the Series 2010 Bonds. (b) The City shall not permit the proceeds of the Series 2010 Bonds or the facilities to be financed with such proceeds to be used in any manner that would result in either (1) 5% or more of such proceeds or the facilities being financed with such proceeds being considered as having been used in any trade or business carried on by any person other than a governmental unit as provided in Section 141(b) of the Code, (2) 5% or more of such proceeds or the facilities being financed with such proceeds being used with respect to any "output facility" (other than a facility for the furnishing of water) within the meaning of Section 141(b)(4) of the Code, or (3) 5% or more of such proceeds being considered as having been used directly or indirectly to make or finance loans to any person other than a governmental unit, as provided in Section 141(c) of the Code. (c) The City shall not take any other action that would adversely affect, and shall take all action within its power necessary to maintain, the exclusion of interest on all Series 2010 Bonds from gross income for federal income taxation purposes; provided, however, that if the City receives an opinion of Bond Counsel that compliance with any such covenant is not required to prevent the interest on the Tax -Exempt Bonds from being includable in the gross income of the registered owners thereof under existing law, the City need not comply with such restriction. (d) The City shall not take any other action that would adversely affect, and shall take all action within its power necessary to maintain, the eligibility of the Taxable Bonds as "build America bonds" for purposes of the American Recovery and Reinvestment Act of 2009, including the applicable provisions in Sections 141, 148 and 149 of the Code. Section 9.502 Rebate Requirement. The City shall determine and pay, from any legally available source, the Rebate Amount, if any, to the United States of America, as and when due, in accordance with the "rebate requirement" described in Section 148(0 of the Code and retain records of all such determinations until six years after payment of the Series 2010 Bonds. 10 Section 9.503 Calculation and Payment of Rebate Amount. (a) The City selects June 1 as the end of the bond year with respect to the Series 2010 Bonds pursuant to Treasury Regulation Section 1.148-1. (b) Within 30 days after the initial installment computation date, the last day of the fifth bond year (June 1, 2015), unless such date is changed by the City prior to the date that any amount with respect to the Series 2010 Bonds is paid or required to be paid to the United States of America as required by Section 148 of the Code, and at least once every five years thereafter, the City shall cause the Rebate Amount to be computed. Prior to any payment of the Rebate Amount to the United States of America as required by Section 148 of the Code, such computation (the "Rebate Amount Certificate") setting forth such Rebate Amount shall be prepared or approved by (1) a person with experience in matters of governmental accounting for Federal income tax purposes or (2) a bona fide arbitrage rebate calculation reporting service. (c) Not later than 60 days after the initial installment computation date, the City shall pay to the United States of America at least 90% of the Rebate Amount as set forth in the Rebate Amount Certificate prepared with respect to such installment computation date. At least once on or before 60 days after the installment computation date that is the fifth anniversary of the initial installment computation date and on or before 60 days every fifth anniversary date thereafter until final payment of the Series 2010 Bonds, the City shall pay to the United States of America not less than the amount, if any, by which 90% of the Rebate Amount set forth in the most recent Rebate Amount Certificate exceeds the aggregate of all such payments theretofore made to the United States of America pursuant to this Section. On or before 60 days after final payment of the Series 2010 Bonds, the City shall pay to the United States of America the amount, if any, by which 100% of the Rebate Amount set forth in the Rebate Amount Certificate with respect to the date of final payment of the Series 2010 Bonds exceeds the aggregate of all payments theretofore made pursuant to this Section. All such payments shall be made by the City from any legally available source. (d) Notwithstanding any provision of this Article to the contrary, no such calculation or payment shall be made if the City receives an opinion of Bond Counsel to the effect that (1) such payment is not required under the Code in order to prevent the Series 2010 Bonds from becoming "arbitrage bonds" within the meaning of Section 148 of the Code or (2) such payment should be calculated and paid on some alternative basis under the Code, and the City complies with such alternative basis. ARTICLE VI AMENDMENTS TO MASTER RESOLUTION Section 9.601 Effective Date of Amendment. Notwithstanding anything herein to the contrary, pursuant to Section 1102 of the Master Resolution, the amendments provided in this Article shall be effective upon the consent of the holders of a majority in aggregate principal amount of Bonds then Outstanding. The original 11 I II purchasers of the Series 2010 Bonds by their purchase thereof shall be deemed to have consented to the amendments provided in this Article. At such time as the City has received the consent of the holders of not less than a majority in aggregate principal amount of Outstanding Bonds to the amendments provided in this Article, the City shall cause the "Notice to Bondholders" attached hereto as Appendix D to be sent by facsimile or electronic transmission, registered or certified mail or overnight express delivery to the holders of any then Outstanding (a) $1,405,031.36 Taxable Water and Sewer System Revenue Bond, Series of 1994, (b) $7,500,000 Taxable Water and Sewer System Revenue Bond, Series of 1997, (c) $6,200,000 Taxable Water and Sewer System Revenue Bond, Series of 1998, (d) $40,000,000 Water and Sewer System Revenue Bonds, Series of 2000, (e) $28,000,000 Water and Sewer System Revenue Bonds, Series of 2002, and (f) $92,700,000 Water and Sewer System Revenue and Refunding Bonds, Series of 2005. Section 9.602 Amendment to Section 101. The definition of "Utility Transfers" in Section 101 of the Master Resolution is hereby amended to read as follows: "Utility Transfers" shall mean annual transfers from the Residual Account to the City's general fund, as may be approved by the City Council, as payments in lieu of taxes, in an annual amount equal to the lesser of $4,000,000 and 15% of the Net Assets Restricted for Operations, as shown on the City's audited financial statements. Utility Transfers are to compensate the City's general fund for loss of System Revenues because the System is owned by the City and is not a private entity. ARTICLE VII MISCELLANEOUS Section 9.701 Limitation of Rights. With the exception of the rights herein expressly conferred, nothing expressed or mentioned in or to be implied from this Ninth Supplemental Resolution is intended or shall be construed to give any person other than the parties hereto and the holders of the Series 2010 Bonds any legal or equitable right, remedy or claim under or in respect to this Ninth Supplemental Resolution or any covenant, condition or agreement herein contained, this Ninth Supplemental Resolution and all of the covenants, conditions and agreements hereof being intended to be and being for the sole and exclusive benefit of the holders of the Series 2010 Bonds as herein provided. Section 9.702 SNAP Investment. The Council has received and reviewed the Information Statement (the "Information Statement") describing the State Non -Arbitrage Program of the Commonwealth of Virginia ("SNAP") and the Contract Creating the State Non -Arbitrage Program Pool I (the "Contract"). The Council acknowledges the Treasury Board of the Commonwealth of Virginia is not, and 12 shall not be, in any way liable to the City in connection with SNAP, except as otherwise provided in the Contract. Section 9.703 Severability. If any provision of this Ninth Supplemental Resolution shall be held invalid by any court of competent jurisdiction, such holding shall not invalidate any other provision hereof. Section 9.704 Effective Date. This Ninth Supplemental Resolution shall take effect immediately. APPROVED AS TO CONTENT: 4/(19/Y\ 0'f Finance Dep ment 13 APPROVED AS TO LEGAL SUFFICIENCY: City o ey's Office APPENDIX A DESCRIPTION OF THE 2010 PROJECT CITY OF VIRGINIA BEACH, VIRGINIA WATER AND SEWER SYSTEM REVENUE BONDS SERIES OF 2010 The 2010 Project consists of extensions, improvements, enlargements, additions and replacements to the plants, systems, facilities, equipment or property owned, in whole or in part, acquired, operated or maintained by or on behalf of the City of Virginia Beach, Virginia, in connection with the collection, treatment or disposal of sanitary sewer and the supply, treatment, storage or distribution of water. The water system improvements include but are not limited to replacement of existing water mains, construction of new water mains, modification of existing pump stations and small line improvements. The sanitary sewer system improvements include but are not limited to construction of new gravity sanitary sewers, construction of new force mains, modification of existing pumping stations and construction of new pumping stations. A-1 APPENDIX B FORM OF TAX-EXEMPT BONDS Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to the issuer or its agent for registration of transfer, exchange, or payment, and any certificate is registered in the name of Cede & Co., or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. REGISTERED REGISTERED R- $ UNITED STATES OF AMERICA COMMONWEALTH OF VIRGINIA CITY OF VIRGINIA BEACH Water and Sewer System [Refunding] Revenue Bond, Series of 2010[A] [B] [C] (Tax -Exempt) MATURITY DATE DATED DATE CUSIP October 1, _, 2010 INTEREST RATE REGISTERED OWNER: CEDE & CO. PRINCIPAL AMOUNT: DOLLARS The City of Virginia Beach, Virginia (the "City"), for value received, hereby promises to pay upon surrender hereof at the [principal] corporate trust office of The Bank of New York Mellon Trust Company, N.A. (the "Registrar"), solely from the source and as hereinafter provided, to the registered owner hereof, or registered assigns or legal representative, the principal sum stated above on the maturity date stated above, subject to prior redemption as hereinafter provided, and to pay, solely from such source, interest hereon semiannually on each April 1 and October 1, beginning October 1, 2010, at the annual rate stated above, calculated on the basis of a 360 -day year of twelve 30 -day months. Interest is payable (a) from the Dated Date, if this Bond is authenticated prior to October 1, 2010, or (b) otherwise from the April 1 or October 1 that is, or immediately precedes, the date on which this Bond is authenticated (unless payment of interest hereon is in default, in which case this Bond shall bear interest from the date to which interest has been paid). Interest is payable by check or draft mailed to the registered owner hereof at his address as it appears on the 15th day of the month preceding each interest B-1 payment date on registration books kept by the Registrar. Principal, premium, if any, and interest are payable in lawful money of the United States of America. Notwithstanding any other provision hereof, this Bond is subject to a book entry system maintained by The Depository Trust Company ("DTC") and the payment of principal and interest, the providing of notices and other matters will be made as described in the City's Blanket Letter of Representations to DTC. This Bond is one of an issue of $ Water and Sewer System [Refunding] Revenue Bonds, Series of 2010[A][B][C] (Tax -Exempt) (the "Bonds"), of like date and tenor, except as to number, denomination, rate of interest, privilege of redemption and maturity, authorized and issued pursuant to ordinances and resolutions adopted by the City Council including a resolution adopted on February 11, 1992, as previously supplemented and as supplemented and amended by a resolution adopted on _, 2010 (collectively, the "Resolution"), and the Constitution and statutes of the Commonwealth of Virginia, including the City Charter and the Public Finance Act of 1991, to provide funds, together with other available funds, to pay the cost of the acquisition and construction of improvements and extensions to the City's water and sanitary sewer system (the "System"), as more fully described in the Resolution. The Bonds and the premium, if any, and the interest thereon are limited obligations of the City and are payable solely from the revenues to be derived from the ownership or operation of the System, as the same may from time to time exist, except to the extent payable from the proceeds of the Bonds, the income, if any, derived from the investment thereof, certain reserves, income from investments pursuant to the Resolution or proceeds of insurance, which revenues and other moneys have been pledged as described in the Resolution to secure payment thereof. The Bonds, the premium, if any, and the interest thereon are payable solely from the revenues pledged thereto in the Resolution, and nothing herein or in the Resolution shall be deemed to create or constitute an indebtedness of or a pledge of the faith and credit of the Commonwealth of Virginia or of any county, city, town or other political subdivision of the Commonwealth, including the City. The Bonds are issued under and are equally and ratably secured on a parity with the unpaid balance of the City's $1,405,031.36 Taxable Water and Sewer System Revenue Bond, Series of 1994, $7,500,000 Taxable Water and Sewer System Revenue Bond, Series of 1997, $6,200,000 Taxable Water and Sewer System Revenue Bond, Series of 1998, $40,000,000 Water and Sewer System Revenue Bonds, Series of 2000, $28,000,000 Water and Sewer System Revenue Bonds, Series of 2002, and $92,700,000 Water and Sewer System Revenue and Refunding Bonds, Series of 2005 (collectively, the "Parity Bonds"), to the extent set forth in the Resolution. Reference is hereby made to the Resolution and all amendments and supplements thereto for a description of the provisions, among others, with respect to the nature and extent of the security, the rights, duties and obligations of the City, the rights of the holders of the Bonds and the terms upon which the Bonds are issued and secured. Additional bonds ranking equally with the Bonds and the Parity Bonds may be issued on the terms provided in the Resolution. The Bonds are subject to redemption beginning , in whole or in part at any time, at the option of the City, at a redemption price equal to [100]% of the principal amount of Bonds to be redeemed plus interest accrued and unpaid to the redemption date. B-2 Bonds maturing on _, , are required to be redeemed prior to maturity, in part, in accordance with the sinking fund requirements of Section 9.402 of the resolution adopted on _, 2010, on _ in years and amounts upon payment of [100]% of the principal amount thereof plus interest accrued to the redemption date, as follows: Year Amount Year Amount The amount of the Bonds required to be redeemed pursuant to the preceding paragraph may be reduced in accordance with provisions of the Resolution. If less than all the Bonds are called for redemption, the maturities of the Bonds to be redeemed shall be selected in such manner as the City Manager or the chief financial officer of the City may determine to be in the best interest of the City. If less than all of the Bonds of any maturity are called for redemption, the Bonds to be redeemed shall be selected by DTC or any successor securities depository pursuant to its rules and procedures or, if the book entry system is discontinued, shall be selected by the Registrar by lot in such manner as the Registrar in its discretion may determine. In either case, (a) the portion of any Bond to be redeemed shall be in the principal amount of $5,000 or some integral multiple thereof and (b) in selecting Bonds for redemption, each portion of $5,000 principal amount shall be counted as one bond for this purpose. If a portion of a Bond is called for redemption, a new Bond in principal amount equal to the unredeemed portion thereof will be issued to the registered owner upon the surrender hereof. The Registrar will cause notice of the call for redemption identifying the Bonds or portions thereof to be redeemed, not less than 30 nor more than 60 days prior to the redemption date, (1) by facsimile or electronic transmission, registered or certified mail or overnight express delivery, to the holder of each Bond to be redeemed at his address as it appears on the registration books kept by the Registrar, (2) by facsimile or electronic transmission, registered or certified mail or overnight express delivery, to all organizations registered with the Securities and Exchange Commission as securities depositories, and (3) to the Electronic Municipal Market Access (EMMA) system (established by the Municipal Securities Rulemaking Board) or any other nationally recognized municipal securities information repository designated as such by the Securities and Exchange Commission. Provided funds for their redemption are on deposit at the place of payment on the redemption date, all Bonds or portions thereof so called for redemption shall cease to bear interest on such date, shall no longer be secured as set forth in the Resolution and shall not be deemed to be outstanding under the provisions of the Resolution. The registered owner of this Bond shall have no right to enforce the provisions of the Resolution or to institute action to enforce the covenants therein or to take any action with respect to any Event of Default under the Resolution or to institute, appear in or defend any suit or other proceedings with respect thereto, except as provided in the Resolution. Modifications or alterations of the Resolution, or of any supplement thereto, may be made only to the extent and in the circumstances permitted by the Resolution. B-3 1 The Registrar shall treat the registered owner as the person exclusively entitled to payment of principal, premium, if any, and interest and the exercise of all other rights and powers of the owner, except that interest payments shall be made to the person shown as owner on the 15th day of the month preceding each interest payment date. All acts, conditions and things required to happen, exist or be performed precedent to and in the issuance of this Bond have happened, exist and have been performed. This Bond shall not be valid or be entitled to any security or benefit under the Resolution until the Registrar shall have executed the Certificate of Authentication appearing hereon and inserted the date of authentication hereon. B-4 IN WITNESS WHEREOF, the City of Virginia Beach, Virginia, has caused this Bond to be signed by the manual signature of its Mayor, to be countersigned by the manual signature of its Clerk, its seal to be impressed hereon, and this Bond to be dated the Dated Date. COUNTERSIGNED: (SEAL) Clerk, City of Virginia Beach, Virginia Mayor, City of Virginia Beach, Virginia Date Authenticated: B-5 1 CERTIFICATE OF AUTHENTICATION This Bond is one of the Bonds described in the within -mentioned Resolution. Registrar By Authorized Signature ASSIGNMENT FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and transfer(s) unto (please print or typewrite name and address including zip code of Transferee) PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF TRANSFEREE the within -mentioned Bond and all rights thereunder, hereby irrevocably constituting and appointing Attorney, to transfer said Bond on the books kept for the registration thereof, with full power of substitution in the premises. Dated: Signature Guaranteed NOTICE: Signature(s) must be guaranteed by an Eligible Guarantor Institution such as a Commercial Bank, Trust Company, Securities Broker/Dealer, Credit Union or Savings Association who is a member of a medallion program approved by The Securities Transfer Association, Inc. B-7 (Signature of Registered Owner) NOTICE: The signature above must correspond with the name of the registered owner as it appears on the front of this bond in every particular, without alteration or enlargement or any change whatsoever. APPENDIX C FORM OF TAXABLE BONDS Interest on this bond is intended by the issuer thereof to be included in gross income for federal income tax purposes. Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to the issuer or its agent for registration of transfer, exchange, or payment, and any certificate is registered in the name of Cede & Co., or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein. REGISTERED REGISTERED R- $ UNITED STATES OF AMERICA COMMONWEALTH OF VIRGINIA CITY OF VIRGINIA BEACH Water and Sewer System Revenue Bond, Series of 2010A (Taxable - Build America Bonds) INTEREST RATE MATURITY DATE DATED DATE CUSIP October 1, , 2010 REGISTERED OWNER: CEDE & CO. PRINCIPAL AMOUNT: DOLLARS The City of Virginia Beach, Virginia (the "City"), for value received, hereby promises to pay upon surrender hereof at the [principal] corporate trust office of The Bank of New York Mellon Trust Company, N.A. (the "Registrar"), solely from the source and as hereinafter provided, to the registered owner hereof, or registered assigns or legal representative, the principal sum stated above on the maturity date stated above, subject to prior redemption as hereinafter provided, and to pay, solely from such source, interest hereon semiannually on each April 1 and October 1, beginning October 1, 2010, at the annual rate stated above, calculated on the basis of a 360 -day year of twelve 30 -day months. Interest is payable (a) from the Dated Date, if this Bond is authenticated prior to October 1, 2010, or (b) otherwise from the April 1 or C-1 October 1 that is, or immediately precedes, the date on which this Bond is authenticated (unless payment of interest hereon is in default, in which case this Bond shall bear interest from the date to which interest has been paid). Interest is payable by check or draft mailed to the registered owner hereof at his address as it appears on the 15th day of the month preceding each interest payment date on registration books kept by the Registrar. Principal, premium, if any, and interest are payable in lawful money of the United States of America. Notwithstanding any other provision hereof, this Bond is subject to a book entry system maintained by The Depository Trust Company ("DTC") and the payment of principal and interest, the providing of notices and other matters will be made as described in the City's Blanket Letter of Representations to DTC. This Bond is one of an issue of $ Water and Sewer System Revenue Bonds, Series of 2010A (Taxable - Build America Bonds) (the "Bonds"), of like date and tenor, except as to number, denomination, rate of interest, privilege of redemption and maturity, authorized and issued pursuant to ordinances and resolutions adopted by the City Council including a resolution adopted on February 11, 1992, as previously supplemented and as supplemented and amended by a resolution adopted on _, 2010 (collectively, the "Resolution"), and the Constitution and statutes of the Commonwealth of Virginia, including the City Charter and the Public Finance Act of 1991, to provide funds, together with other available funds, to pay the cost of the acquisition and construction of improvements and extensions to the City's water and sanitary sewer system (the "System"), as more fully described in the Resolution. The Bonds and the premium, if any, and the interest thereon are limited obligations of the City and are payable solely from the revenues to be derived from the ownership or operation of the System, as the same may from time to time exist, except to the extent payable from the proceeds of the Bonds, the income, if any, derived from the investment thereof, certain reserves, income from investments pursuant to the Resolution or proceeds of insurance, which revenues and other moneys have been pledged as described in the Resolution to secure payment thereof. The Bonds, the premium, if any, and the interest thereon are payable solely from the revenues pledged thereto in the Resolution, and nothing herein or in the Resolution shall be deemed to create or constitute an indebtedness of or a pledge of the faith and credit of the Commonwealth of Virginia or of any county, city, town or other political subdivision of the Commonwealth, including the City. The Bonds are issued under and are equally and ratably secured on a parity with the unpaid balance of the City's $1,405,031.36 Taxable Water and Sewer System Revenue Bond, Series of 1994, $7,500,000 Taxable Water and Sewer System Revenue Bond, Series of 1997, $6,200,000 Taxable Water and Sewer System Revenue Bond, Series of 1998, $40,000,000 Water and Sewer System Revenue Bonds, Series of 2000, $28,000,000 Water and Sewer System Revenue Bonds, Series of 2002, and $92,700,000 Water and Sewer System Revenue and Refunding Bonds, Series of 2005 (collectively, the "Parity Bonds"), to the extent set forth in the Resolution. Reference is hereby made to the Resolution and all amendments and supplements thereto for a description of the provisions, among others, with respect to the nature and extent of the security, the rights, duties and obligations of the City, the rights of the holders of the Bonds and the terms upon which the Bonds are issued and secured. Additional bonds ranking equally with the Bonds and the Parity Bonds may be issued on the terms provided in the Resolution. C-2 I II Optional Redemption. The Bonds are subject to redemption beginning October 1, in whole or in part at any time, at the option of the City, at a redemption price equal to [100]% of the principal amount of Bonds to be redeemed plus interest accrued and unpaid to the redemption date. Mandatory Redemption. Bonds maturing on October 1, , are required to be redeemed prior to maturity, in part, in accordance with the sinking fund requirements of Section 9.402 of the resolution adopted on_, 2010, on in years and amounts upon payment of [100]% of the principal amount thereof plus interest accrued to the redemption date, as follows: Year Amount Year Amount The amount of the Bonds required to be redeemed pursuant to the preceding paragraph may be reduced in accordance with provisions of the Resolution. Extraordinary Optional Redemption of Bonds Due to Loss of Build America Bond Status. Prior to , , the Bonds are subject to redemption prior to their maturity at the option of the City, in whole or in part, upon the occurrence of an Extraordinary Build America Bond Event (as hereinafter defined) at a redemption price equal to the greater of: (i) 100% of the principal amount of the Bonds to be redeemed; and (ii) The sum of the present value of the remaining scheduled payments of principal and interest to the maturity date of the Bonds to be redeemed, not including any portion of those payments of interest accrued and unpaid as of the date on which the Bonds are to be redeemed, discounted to the date on which the Bonds are to be redeemed on a semi-annual basis, assuming a 360 -day year consisting of twelve 30 -day months, at the Treasury Rate (as hereinafter defined), plus 100 basis points; plus, in either case, accrued interest on such Bonds to be redeemed to the redemption date. An "Extraordinary Build America Bond Event" will have occurred if a material adverse change has occurred to Section 54AA or 6431 of the Code (as such Sections were added by Section 1531 of the Recovery Act, pertaining to "Build America Bonds") or there is any guidance published by the Internal Revenue Service or the United States Treasury with respect to such Sections or any other determination by the Internal Revenue Service or the United States Treasury, which determination is not the result of any act or omission by the City to satisfy the requirements to qualify to receive the Federal Subsidy from the United States Treasury, pursuant to which the City's 35% Federal Subsidy from the United States Treasury is reduced or eliminated. "Treasury Rate" means, as of any redemption date, the yield to maturity as of such redemption date of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two Business Days prior to the redemption date (excluding inflation C-3 I II indexed securities) (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the redemption date to the maturity date of the Bonds to be redeemed; provided, however, that if the period from the redemption date to such maturity date is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used. The redemption price of such Bonds to be redeemed will be determined by an independent accounting firm, investment banking firm or financial advisor retained by the City to calculate such redemption price. The City may conclusively rely on the determination of such redemption price by such independent accounting firm, investment banking firm or financial advisor and will not be liable for such reliance. If less than all the Bonds are called for redemption, the maturities of the Bonds to be redeemed shall be selected in such manner as the City Manager or the chief financial officer of the City may determine to be in the best interest of the City. If less than all of the Bonds of a particular maturity are called for redemption, the particular Bonds to be redeemed will be selected on a pro -rata basis. With respect to such Bonds sold, "pro rata" is determined, in connection with any mandatory sinking fund redemption or any optional redemption in part, by multiplying the principal amount of such maturity to be redeemed on the applicable redemption date by a fraction, the numerator of which is equal to the principal amount of the Bond of such maturity owned by the registered owner, and the denominator of which is equal to the total amount of the Bonds of such maturity then outstanding immediately prior to such redemption date, and then rounding the product down to the next lower integral multiple of $5,000; provided that the portion of any Bonds to be redeemed are required to be in authorized denominations and all Bonds of a maturity to remain outstanding following any redemption are required to be in authorized denominations. Notwithstanding the foregoing, if the Bonds are in book -entry form at the time of such redemption, the City will instruct DTC to instruct the DTC participants to select the specific Bonds for redemption by lot within maturities among Beneficial Owners, and the City shall not have any responsibility to ensure that DTC or the DTC participants properly select such Bonds for redemption. In either case, (a) the portion of any Bond to be redeemed shall be in the principal amount of $5,000 or some integral multiple thereof and (b) in selecting Bonds for redemption, each portion of $5,000 principal amount shall be counted as one bond for this purpose. If a portion of a Bond is called for redemption, a new Bond in principal amount equal to the unredeemed portion thereof will be issued to the registered owner upon the surrender hereof. The Registrar will cause notice of the call for redemption identifying the Bonds or portions thereof to be redeemed, not less than 30 nor more than 60 days prior to the redemption date, (1) by facsimile or electronic transmission, registered or certified mail or overnight express delivery, to the holder of each Bond to be redeemed at his address as it appears on the registration books kept by the Registrar, (2) by facsimile or electronic transmission, registered or certified mail or overnight express delivery, to all organizations registered with the Securities and Exchange Commission as securities depositories, and (3) to the Electronic Municipal Market Access (EMMA) system (established by the Municipal Securities Rulemaking Board) or any other nationally recognized municipal securities information repository designated as such by the Securities and Exchange Commission. C-4 1 Provided funds for their redemption are on deposit at the place of payment on the redemption date, all Bonds or portions thereof so called for redemption shall cease to bear interest on such date, shall no longer be secured as set forth in the Resolution and shall not be deemed to be outstanding under the provisions of the Resolution. The registered owner of this Bond shall have no right to enforce the provisions of the Resolution or to institute action to enforce the covenants therein or to take any action with respect to any Event of Default under the Resolution or to institute, appear in or defend any suit or other proceedings with respect thereto, except as provided in the Resolution. Modifications or alterations of the Resolution, or of any supplement thereto, may be made only to the extent and in the circumstances permitted by the Resolution. The Registrar shall treat the registered owner as the person exclusively entitled to payment of principal, premium, if any, and interest and the exercise of all other rights and powers of the owner, except that interest payments shall be made to the person shown as owner on the 15th day of the month preceding each interest payment date. All acts, conditions and things required to happen, exist or be performed precedent to and in the issuance of this Bond have happened, exist and have been performed. This Bond shall not be valid or be entitled to any security or benefit under the Resolution until the Registrar shall have executed the Certificate of Authentication appearing hereon and inserted the date of authentication hereon. C-5 1 IN WITNESS WHEREOF, the City of Virginia Beach, Virginia, has caused this Bond to be signed by the manual signature of its Mayor, to be countersigned by the manual signature of its Clerk, its seal to be impressed hereon, and this Bond to be dated the Dated Date. COUNTERSIGNED: (SEAL) Clerk, City of Virginia Beach, Virginia Mayor, City of Virginia Beach, Virginia Date Authenticated: C-6 1 CERTIFICATE OF AUTHENTICATION This Bond is one of the Bonds described in the within -mentioned Resolution. Registrar By Authorized Signature I ASSIGNMENT FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and transfer(s) unto (please print or typewrite name and address including zip code of Transferee) PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF TRANSFEREE the within -mentioned Bond and all rights thereunder, hereby irrevocably constituting and appointing Attorney, to transfer said Bond on the books kept for the registration thereof, with full power of substitution in the premises. Dated: Signature Guaranteed NOTICE: Signature(s) must be guaranteed by an Eligible Guarantor Institution such as a Commercial Bank, Trust Company, Securities Broker/Dealer, Credit Union or Savings Association who is a member of a medallion program approved by The Securities Transfer Association, Inc. C-8 (Signature of Registered Owner) NOTICE: The signature above must correspond with the name of the registered owner as it appears on the front of this bond in every particular, without alteration or enlargement or any change whatsoever. APPENDIX D NOTICE TO BONDHOLDERS NOTICE OF AMENDMENT TO MASTER RESOLUTION CITY OF VIRGINIA BEACH, VIRGINIA Taxable Water and Sewer System Revenue Bond, Series of 1994 Taxable Water and Sewer System Revenue Bond, Series of 1997 Taxable Water and Sewer System Revenue Bond, Series of 1998 Water and Sewer System Revenue Bonds, Series of 2000 [CUSIPS & Maturities] Water and Sewer System Revenue Bonds, Series of 2002 [CUSIPS & Maturities] Water and Sewer System Revenue and Refunding Bonds, Series of 2005 [CUSIPS & Maturities] The Bank of New York is Bond Registrar for the above -captioned bonds (the "Bonds"), which were issued under a Master Resolution adopted by the City Council (the "City Council") of the City of Virginia Beach, Virginia (the "City"), on February 11, 1992, as previously supplemented and amended (the "Master Resolution"). The purpose of this Notice is to notify Bondholders that the Master Resolution has been amended. Capitalized terms used and not defined herein shall have the meanings ascribed to them in the Master Resolution. The amendment relates to the amount the City is permitted to transfer annually from the Residual Account to the City's general fund ("Utility Transfers"). Prior to the effective date of the amendment, "Utility Transfers" were limited to an amount not to exceed 2% of the increase of retained earnings of the System for the immediately preceding fiscal year over the next previous fiscal year, as shown on the City's audited financial statements, to compensate the City for general revenue it would otherwise have received had the System been owned by a private operator. The amendment allows annual transfers as may be approved by City Council, as payments in lieu of taxes, in an annual amount equal to the lesser of $4,000,000 and 15% of the Net Assets Restricted for Operations, as shown on the City's financial statements. Transfers from the Residual Account are permitted only after the payment of debt service on the Bonds. A copy of the Master Resolution and the amendment may be obtained from the Clerk of the City upon written request (addressed to the attention of the Department of Finance, Municipal Center, Virginia Beach, Virginia 23456), together with satisfactory evidence that the requestor is a holder of a Bond. No amendments were made to the terms of the Bonds. CUSIP Numbers are included solely for the convenience of the Bondholders. Neither the City nor The Bank of New York D-1 1 shall be responsible for the selection or use of the CUSIP Numbers, nor is any representation made as to its correctness on any bond or as indicated in any notice. Dated: THE BANK OF NEW YORK, as Registrar D-2 City of Virginia Beach Department of Public Utilities Municipal Center, Building 2 • 2405 Courthouse Drive • Virginia Beach, VA 23456-9034 DRAFT Financial Feasibility Report Series 2010 Water and Sewer Revenue Bonds May 2010 Report Prepared By: REIN CONSULTI NG A WYI61O14 fir MALCOLM P1RMIG 310 Bendix Road, Suite 410 Virginia Beach, VA 23452 0153443 757-419-3970 Table of Contents Contents 1. Introduction 1.1. Purpose .............................. 1.2. System Overview ............... 1-1 1.3. Report Organization 1-2 2. Organization and Management 2-1 2.1. Organization...................................................,,..,.,..................... 2.1 22. Management............................................................... 3. Water System Description ...... 2-1 3-1 3.1. History of Water System .................... ......... ......... ,,..,,..,.,... 3-1 3.2. Water System Description................................................................ 3-2 3.2.1. Source of Supply........................................................................................ 3-2 3.2.2. Water Treatment ......................................... 3-3 3.2.3. Water Transmission and Distribution............................................................ 3-4 3.2.3.1. Pump Stations..................................................................................... 3-4 3.2.32. Water Storage ......,.. ..................... .......................... 3-5 3.3. Water System Condition............................................................................................. 3-7 3.4. Water System Service Area ............... .................... ..... .,..,, ..,.....,.,...,........... 3-7 3.5. Water Demand.............................................................................................................. 3-9 3.6. Inter -Governmental Agreements............................................................................... 3-10 3.6.1. Norfolk Water Services Contract.... ,.............................. .......... ............. 3-10 3.6.2. Wheeling Agreement with the U.S. Government ..................................... 3-11 3.7. Existing Water Rates..............................................................................................3.11 4. Sanitary Sewer System Description .1 4.1. History of Sanitary Sewer System • ................... ......... ............. 4-1 4.2. Sanitary Sewer System Description ................................................. ,........................ . 4-2 4.3. Sanitary Sewer System Condition ................. ......... .................... ...................... ... 4-4 4.4. Sanitary Sewer System Service Area.. ....................................................... 4-4 4.5. Existing Sanitary Sewer Rates.. ............. . .. . ... ......... ..... .............. ... 4-5 5. Capital Improvement Plan 5-1 5.1. Introduction ..............................................•.,... 5-1 5.2. Description of Water System Projects ............... • 5-1 5.3. Description of Sanitary Sewer Projects ................................. 6.Financial Feasibility ............................ 5-2 6-1 RED') ° `. Cily of 4'irginia Beach CONSUL I N ,wr Financ. Feasibility Report ...E.;., .� •,...• • • w = 015.14-43 Draft Financial Fcasibildy Report Table of Contents 6.1. Historical and Projected Revenues. ........ ....... ................. ..... . ..... 6-1 6.1.1. Historical Revenues6-1 6.1.2. Projected Revenues...—. ......................................... 6.1 6.1.2.1. Projected Water and Sewer Accounts and Water Demand 6-2 6.1.2.2. Projected Water and Sewer Rates 6-4 6.1.3. Projected Rate Revenues ........................................................................ 6-7 6.1.4. Projected Other Revenues 6-7 6.2. Historical and Projected O&M Expense.....,.. .................................... ........................ 6-8 6.3. Capital Improvement Plan Funding........................................................................,.... 6-9 6.4. Historic and Projected Debt Service 6-10 6.4.1. Debt Service Coverage Requirements 6-10 6.4.2. Debt Management Policies ........................................ ......... 6-12 7. Conclusion 7-1 7.1, Conclusions..............................»,...»,.,..»,,.........................• ......... ........................., 7-1 7.2. Considerations and Assumptions ...... .... .............. 7-2 List of Tables Table 3-1: Water Pump Station Locations and Capacities ........................... 3-5 Table3-2: Water System Storage ...........................................................................,...,.,.......... 3-6 Table 3-3: Water Account History 3-8 Table 3-4: Water Demand History ....................... ............... 3-9 Table 3-5: Average Annual Norfolk Water Rate Charged to the City ........................................ 3-10 Table 3-6: Summary of Historical and Existing Water Rates .... ................ .............. ............,..... 3-12 Table 4-1: Sanitary Sewer Pump Station Summary 4-3 Table 4-2: Sewer Account History 4-5 Table 4-3: Summary of Historical and Existing Sewer Rates....,,...... 4-6 Table 5-1: Water and Sewer Capital Improvement Plan 5-1 Table 6-1: Historical Water and Sewer Revenues 6-2 Table 6-2: Projection of Water Accounts and Billed Water Consumption__. ..... ..... ........ .... 6-3 Table 6-3: Projection of Sewer Accounts 6-4 Table 6-5: Anticipated Sewer Rates FY 2011Through FY 2015...,.. .............. 6-6 Table 6-6: Cash Flow Forecast 6-12 Table 6-7: Projected Debt Service Coverage 6-13 REj .)A . City of Virginia Beach CONSULTING Financial Feasibility Report • 0153443 Draft Financial Feasibility Report ii Figures Table of Contents Figure 3-1 Lake Gaston Facilities .............. . .... .... .... .... __Following Page 3-3 Figure 3-2 Existing Water and Sewer Service Area....., Following Page 3-7 KEMP, K City of Virginia Beach CONSULT 1 N Financial Feasibility Report • caL •••*, 0153443 Draft Financial Feasibiliiy Report Iii 1. Introduction 1.1. Purpose This report has been prepared by Red Oak Consulting, a Division of Malcolm Pimie, Inc. ("Red Oak") to document our evaluation of the financial feasibility of the City of Virginia Beach, Virginia ("City"), Department of Public Utilities (the "Department") Water and Sewer Enterprise Fund to generate revenues sufficient to provide for the payment of operating expenses and debt service, and achieve required financial performance measures, such as debt service coverage and reserves. The City intends to issue approximately $65 million in Series 2010 Water and Sewer Bonds in calendar year 2010. The proceeds are to be used to fund water and sewer utility capital projects. 1.2. System Overview The Department provides water and sanitary sewer services to approximately 433,511 people in Virginia Beach. The City maintains a Water and Sewer Fund, which is a separate and independent enterprise fund. The City's fiscal year starts on July ls` of each year. The Department purchases water treatment and conveyance services from the City of Norfolk under a Water Services Contract. Water is conveyed to approximately 131,000 customers through a City -owned transmission and distribution system. The water system is comprised of more than 1,400 miles of transmission and distribution mains, twelve distribution storage tanks, and nine pumping stations (including the Lake Gaston raw water pump station). The demand for water has increased over the past 10 years (from fiscal year ("FY") 1998 to FY 2008) along with residential and commercial development. However, the average usage per account has decreased slightly over the same period. Average daily water use was approximately 35.4 million gallons per day (mgd) in 2008 and 33.8 mgd in 2009. The Department also provides water to U.S. Government establishments in the City that are customers of the City of Norfolk. Under the terms of an agreement with the U.S. Government, the City "wheels" water purchased by the U.S. Government from the City of Norfolk for delivery through City water lines to U.S. Government establishments. The City is reimbursed for the cost of wheeling water at a rate of $0.44 per thousand gallons, and wheeling revenue amounts to approximately $150,000 to $190,000 per year. Sanitary sewer services are provided to approximately 129,000 customers through a network of collection lines, force mains, and pump stations. The sanitary sewer system R.EIIJ %1.City of Virginia Beach CONSU111NGT Financial Feasibility Report ,..— 0153443 Draft Financial Feasibility Report i-1 Section 1 Introduction consists of 1,621 miles of pipeline, and 405 sewer pumping stations. Wastewater is conveyed from individual properties to one of two wastewater treatment plants owned and operated by the Hampton Roads Sanitation District ("HRSD"). City customers pay a commodity charge for treatment of wastewater to HRSD, in addition to the City's charge for sanitary sewer collection. 1.3. Report Organization In addition to this Introduction section, this report contains the following sections: • Section 2 — Organization and Management — This section provides a description of the City's Water and Sewer Fund and its organization and management. • Section 3 —Water System Description — This section provides a summary of the water system service area, system facilities, inter -municipal agreements, and existing and anticipated future system demands. • Section 4 — Sanitary Sewer System Description - This section provides a summary of the sanitary sewer system service area, system facilities, and existing and anticipated future system demands. • Section 5 — Capital Improvement Plan — This section describes the planned capital improvements and the estimated project costs. • Section 6 — Financial Feasibility — This section contains a projection of the financial condition of the City's Water and Sewer Fund, projected revenues, expenditures, projected debt service coverage, and projected user charges. • Section 7 — Conclusion — This section contains conclusions of the study and an opinion of financial feasibility for the proposed bond issuance. RED)A City of Virginia Beach CONSU I Tl Nt Financial Feasibility Report .,a- >_ -�«_•- . ,y.< 0153443 Draft Financial Feasibility Report 1-2 2. Organization and Management 2.1. Organization The City's Department of Public Utilities is organized into four divisions, namely: the Director's Office, Engineering, Operations and Maintenance, and Business. The Department has approximately 404 employees. The Director of Public Utilities oversees the operation of each of the four divisions. The Engineering Division Manager oversees the Capital Improvements Fund, manages the development and administration of this Division, and coordinates engineering and administration for the City's raw water supply. The Utility Operations Division Manager oversees the Operations and Maintenance Division, including the operation and maintenance of the water distribution and sanitary sewer collection system. The Business Division Manager is responsible for human resources, customer service, finance, and administration. 2.2. Management Mr. Thomas M. Leahy, III is the Director of Public Utilities and has been in his present position since May 2005. He was previously Acting Director of Public Utilities from March 2003 through April 2005 and Water Resources Manager of Public Utilities from July 1980 through February 2003. He has a Bachelor of Science in Chemical Engineering, a Master of Science in Chemical Engineering, and a Masters in Public Administration. He is a registered Professional Engineer and is a member of the American Water Works Association, National Society of Professional Engineers, American Desalting Association, and Association of Metropolitan Water Agencies. Mr. Gary L. Jones is the Engineering Division Manager of Public Utilities and has 33 years of experience with the Department. He has served as the Engineering Manager for the past 14 years and the Assistant Director of Public Utilities for the 10 years prior to serving as the Engineering Manager. He has a Bachelor of Science in Civil Engineering and has participated in continuing education classes in Management. He is a registered Professional Engineer, a Registered Land Surveyor, and is a member of the American Water Works Association, American Society of Civil Engineers, National Society of Professional Engineers, and Virginia Society of Professional Engineers. Mr. James W. Sarver is the Utility Operations Division Manager and has worked for the City of Virginia Beach for 34 years. He has served in his current position as Utility Operations Manager since 1992. He has a Bachelor of Science degree in Civil Engineering and a Masters degree in Engineering Administration. He is a registered Professional Engineer and is a member of the American Society of Civil Engineers and American Water Works Association. R,E ; ` ;, City of Virginia Beach CONSULTING Financial Feasibility Report , — ,...,,o,. --, 0153443 Draft Financial Feasibility Report 2-1 Section 2 Organization and Management Mr. Robert S. Montague, Jr. is the Business Division Manager and has 15 years of experience with the Department of Public Utilities. He has served in his current position since 2001. He has a Bachelor of Arts in Government and a Masters in Public Administration. He is a member of the American Water Works Association. RE .A K City of Virginia Beach CONSULTIN , € Financial Feasibility Report «...e.« .,,-- 0153443 Draft Financial Feasibility Report 2-2 3. Water System Description 3.1. History of Water System The City's water system originated with the incorporation of the Town of Virginia Beach in 1906. The original town consisted principally of a resort area along a narrow section of beach frontage to the Atlantic Ocean. The water system included wells, water mains, pumps, and an iron removal plant. Treated water began to be purchased from the City of Norfolk in 1924, and was conveyed to the City through a 16 -inch diameter transmission main. An additional 20 -inch diameter main was installed from the City of Norfolk to the Town in 1944. The present City of Virginia Beach was created in 1963 through a merger of the Town of Virginia Beach with Princess Anne County. Water was supplied to residents through private wells, small private water systems and, in part, from the City of Norfolk. The City of Virginia Beach purchased the water distribution systems within its boundaries from Norfolk in 1973, and at that time entered into a 20 -year contract to purchase water surpluses from the City of Norfolk. In 1975, a Department of Public Utilities was established to operate the City's Water and Sanitary Sewer Systems. In 1977, the City experienced a drought that caused the initiation of water conservation measures. Stricter mandatory measures were imposed upon citizens of the City during a more severe drought in 1980-81. Surcharges were also assessed for excessive water consumption. Conservation efforts were effective in sustaining the water resources on a short term basis; however, the drought accentuated the need to investigate additional water resources to meet the long-term demands of the City. In 1980 through 1981, the City, in an effort to mitigate water supply constraints, had commissioned numerous studies and imposed water restrictions and surcharges for excessive water consumption. The City had also constructed five emergency wells in the City of Suffolk and Counties of Isle of Wight and Southampton. An investigation into possible Tong -term sources of water supply led to the decision that Lake Gaston was the best alternative source of raw water. Construction of Lake Gaston was completed in 1997 to meet the long-term water demands of the City and in response to drought conditions. The Lake Gaston water supply is an existing impounded water supply source that was created by dams on the RE[;'.: City of Virginia Beach CONS U LCI NG Financial Feasibility Report .,. s. 0153443 Draft Financial Feasibility Report 3-1 Section 3 Water System Description Roanoke River located just south of the Virginia border in North Carolina. Additional information pertaining to Lake Gaston is provided later in this section of the report. In 1973, the City signed a Water Sales Contract with the City of Norfolk to purchase water surpluses from the City of Norfolk. A new Water Sales Contract was subsequently executed and became effective July 1, 1993. This new contract was intended to provide an interim water supply to the City until the Lake Gaston Project became operational and was terminated in January of 1998, except for certain sections that remained until June 30, 1999. The existing Water Services Contract with Norfolk became effective January 1, 1998 and is in effect until 2030. The Water Services Contract establishes engineering, water quality, and operational standards for the City of Norfolk to receive, treat, convey, test, and deliver Lake Gaston water to the City. In late 2000, the City changed its disinfection process in the distribution system from chlorine to chloramines. The change in the disinfection process was to lower disinfection byproducts in response to new and more stringent State and federal regulations. This change has resulted in a one-third reduction in disinfection byproducts in 2001 and improved disinfection performance, along with improved taste and odor. In 2001, the City resumed its annual City-wide flushing program. Flushing the City's public water distribution system of sediment built-up reduces discolored water, taste and odor problems, and water quality degradation in the distribution system. In 2009, the City began a comprehensive asset management program consisting of asset planning, condition and criticality assessment, performance management and level of service program development. 3.2. Water System Description 3.2.1. Source of Supply The major source of water supply for the City is the Pea Hill Creek tributary of Lake Gaston, located in Brunswick County, Virginia. Prior to the completion of the Lake Gaston Project, the City had no independent water supply. The Lake Gaston water supply is an existing impounded water supply source that was created by dams on the Roanoke River located just south of the Virginia border in North Carolina. Construction of Lake Gaston was completed in 1997 to meet the long-term water demands of the City and in response to drought conditions. The Lake Gaston Water Supply Project is a 76 -mile, 60 -inch diameter pipeline extending from the Pea Hill Creek tributary of Lake Gaston in Brunswick County, Virginia to the City of Norfolk's raw water facilities located in the County of Isle of Wight and the City of Suffolk. A R.F. ; i iy City of Virginia Beach CONSULTIN Financial Feasibility Report ,...a. _ t...•. 0153443 Draft Financial Feasibility Report 3-2 Section 3 Water System Description graphical depiction of the Lake Gaston Project is shown in Figure 3-1. The pipeline was designed with a capacity of 60 mgd. The City receives 83.3 percent of the water transported from Lake Gaston. The City of Chesapeake entered into an agreement with the City of Virginia Beach for a 16.7 percent ownership of the Lake Gaston Project. Construction of the Lake Gaston Project was completed in November of 1997 and the pipeline was placed into operation on January 1, 1998. The cost of the completed Lake Gaston Project is estimated at approximately $153,866,000. As of June 30, 2009, the City had incurred expenditures of approximately $152,192,000 for the project. With the exception of $10,145,000 in bonds, all of the Lake Gaston Project expenditures have been paid for by cash, exemplifying the strong financial position of the Fund. The City of Chesapeake has paid $24,548,853 in capital costs and $1,759,284 in operating and maintenance expenses associated with the Project. On March 31, 2004, the Federal Energy Regulatory Commission ("FERC") issued a new, 40 -year license for Lake Gaston that was consistent with a settlement agreement involving Dominion Resources regarding the Lake Gaston hydroelectric project, with the exception of minor issues not related to the City of Virginia Beach's interest. With the settlement agreement and the new license, the regulatory controversies and disputes that surrounded the construction and operation of the Lake Gaston pipeline are now officially concluded. In 2002, the City of Virginia Beach and the City of Norfolk reached an agreement whereby the City of Virginia Beach purchased Stumpy Lake, including adjacent lands and pumping facilities, from the City of Norfolk. Stumpy Lake is located in the City of Virginia Beach. Water from Stumpy Lake will be conveyed to the City of Norfolk for treatment in the same manner as water from Lake Gaston. The Water Services Contract has been amended to cover this new source of supply. The City of Virginia Beach is currently undertaking improvements to the Stumpy Lake facilities as part of its capital improvement program. The raw water sources of the City of Norfolk and City of Virginia Beach, including Lake Gaston are of high quality. Presently, treated water from the City of Norfolk distributed to the City of Virginia Beach is in compliance with the Virginia Department of Health and the U.S. Environmental Protection Agency requirements. 3.2.2. Water Treatment The City of Norfolk's Moores Bridges water treatment plant supplies water to the City of Virginia Beach. The plant is located near the border of the City of Norfolk and the City of Virginia Beach. The plant was originally constructed in 1899 with a capacity of eight mgd. The plant has been upgraded periodically throughout the years, most recently in 1999 when the plant was expanded from a capacity of 77 mgd to 108 mgd. Today the Rhin}''` City of Virginia Beach CONSULTING Financial Feasibility Report ..o. • • 0153443 Draft Financial Feasibility Report 3-3 I Section 3 Water System Description City of Norfolk has a program to meet the City of Virginia Beach's future needs in terms of water treatment and treated water transmission service. The City of Norfolk sources of supply for the Moores Bridge water treatment plant are divided into two systems. The largest is the Western Reservoir System consisting of Lake Prince, Western Branch Reservoir, and Lake Burnt Mills. The Western Reservoir System is located about 20 miles west of the City of Norfolk and can store 13.3 billion gallons of water. The western reservoirs are augmented by water pumped from the Blackwater River and the Nottoway River. The smaller reservoir system, the In -Town Lakes System, consists of interconnected surface supplies from Lake Wright, Lake Whitehurst, Lake Smith, and Lake Lawson. The In -Town Lake System has a storage capacity of 2.4 billion gallons of water and is located near the Moores Bridges Water Treatment Plant. The Pea Hill Creek tributary of Lake Gaston, located in Brunswick County, Virginia and Stumpy Lake, located in the City of Virginia Beach, provides water for the City. The water from Lake Gaston is transmitted to the Western Reservoir System via a 76 mile pipeline operated and maintained by Virginia Beach to the Western Reservoir System, and is treated at the Moores Bridges water treatment plant. In the future, water from Stumpy Lake will be transmitted via an eight mile pipeline operated and maintained by City to the City of Norfolk's In -Town Lakes System for treatment at the Moores Bridges water treatment plant. 3.2.3. Water Transmission and Distribution The City receives treated, potable water from the City of Norfolk. The water is conveyed to approximately 131,000 customers through a City -owned transmission and distribution system. The transmission and distribution system is comprised of approximately 1,482 miles of transmission and distribution mains, twelve distribution storage tanks and nine pumping stations (including the Lake Gaston raw water pump station). The transmission and distribution mains range in size from 2 to 48 inches in diameter, and are constructed of steel, concrete, cast iron, and ductile iron. Water distribution is monitored through 23 master meters at seven locations along the border of the two cities. The Department utilizes a programmed computerized model of the Water System to plan improvements and extensions to the water system. The model of the Water System was developed as part of an ongoing comprehensive water system study. The Department has a policy to repair all significant leaks in the system within 24 hours. 3.2.3.1. Pump Stations There are nine pumping stations in the water system, including the Lake Gaston raw water pump station. Eight pumping stations transfer water through three pressure zones RED City of Virginia Beach CONSUL l NG Financial Feasibility Report . , .,�.9• ...u.* ..••.< 0153443 Draft Financial Feasibility Report 3-4 Section 3 Water System Description within the service area. Maximum pumping capacities of the stations range from 0.8 to 60.0 mgd. A summary of the pump stations and pump station capacities is provided in Table 3-1. Table 3-1: Water Pump Station Locations and Capacities Pump Station Locations 1. Landstown 2. Kempsville Road 3. Columbus Loop 4. Witchduck 5. Lynnhaven 6. Shore Drive 7. Sandbridge 8. Virginia Beach Boulevard 9. Lake Gaston Pump Station Capacity (mgd) 10.0 20.0 30.0 8.5 30.0 8.4 0.8 8.2 60.0 The eight pumping stations conveying treated water can be monitored and operated by telemetric and computer control from the City's Landstown Operations Center. The Landstown Operations Center is the City's water and sanitary sewer system operation and maintenance facility. This facility consists of administrative offices, vehicle, and equipment storage and maintenance facilities, a material storage yard, a water quality testing laboratory, a meter testing facility, and the operation and control center. The Lake Gaston pumping station is controlled independently through an on-site control and monitoring system. The Lake Gaston facilities are operated and maintained by United Water Environmental Services, Inc., a private company, under an eight-year contract with the City of Virginia Beach. The current contract expires July 2011. 3.2.3.2. Water Storage Water storage within the distribution system is comprised of five elevated storage tanks, one ground level storage tank, and six standpipes, which are located at various points throughout the City. The total system storage capacity is 27.75 million gallons ("MG"). A summary of the system storage facilities and capacities is provided in Table 3-2. RED City of Virginia Beach CONSULTING Financial Feasibility Report ...... >, .«.,..,... 0153443 Draft Financial Feasibility Report Section 3 Water System Description Table 3-2: Water System Storage Storage Tank Location Storage Tank Storage Tank Capacity (MG) Type Elevated Storage: Courthouse/Forest 1.00 Elevated Great Neck Road 1.00 Elevated Sandbridge 0.50 Elevated 47'" Street' 0.25 Elevated Plaza Park 1.00 Elevated Total Elevated Storage 3.75 Reservoir Storage: Lynnhaven QI). Reservoir Standpipe Storage: Kempsville Road 3.00 Standpipe Columbus Loop I 4.00 Standpipe Columbus Loop II 4.00 Standpipe Witchduck 2.00 Standpipe Shore Drive 2.00 Standpipe 29'" Street2 4.00 Standpipe Total Standpipe Storage 19.00 Total System Storage 27.75 'Currently being removed. 2Currently being replaced. The Department has developed and implemented an operation and maintenance program for system storage. The purpose of this program is to ensure safe and sanitary operation of the potable water storage tanks and extend the storage system's useful life. Recent and planned improvements include repainting and restoration of 10 tanks to meet structural, sanitary, and health regulations. Upgrades to six tanks have been completed. Repainting and restoration of the Columbus Loop II Tank is scheduled in FY 2011. The 29th Street tank is being replaced due to a failing foundation. The new tank is anticipated to be in service in the spring of FY 2010. The 47th Street tank is hydraulically unnecessary and will be removed in FY 2010. Improvements to the three remaining tanks are scheduled for FY 2012 through FY 2015. Projects related to these efforts are: • Water Tank Upgrade Program Phase II (5-131); ,',•. REEMK K City of Virginia Beach • , CONSULTING Financial Feasibility Report 0153443 Draft Financial Feasibility Report 3-6 Section 3 Water System Description • Water Tank Upgrade Program Phase III (5-167); • 29th Street Water Tank Replacement (5-600); and • Water Pumping Station and Tank Upgrade Program Phase I (5-501). 3.3. Water System Condition A visual inspection of the water system facilities was made on March 2, 2010. This inspection was limited to a visual inspection of a representative sample of water system facilities, including portions of the Lake Gaston pipeline, Lake Gaston intake and outfall structures, water pump stations, water storage tanks, and operations facilities. Based on the visual inspections, the water system is in good working condition. However, a detailed condition assessment was not completed as part of the inspections. Completion of a more detailed criticality and condition assessment of water distribution system assets, including a detailed review of asset condition and failure data, development of an asset criticality model for asset condition ranking, expansion of the Department's asset condition database, and assessment of asset condition assessment activities have been planned as part of the Department's asset management program, and the results of these assessments and activities were not available at the time that this report was prepared. It is estimated that the more detailed water system condition assessment will be completed over the next two to three years. 3.4. Water System Service Area The City's service area is located entirely within the northern half of the corporate City boundaries, as shown on Figure 3-2. As of FY 2009, the water service area is comprised of a land area of nearly 160 square miles. The existing City water system serves approximately 433,500 people and approximately 131,000 customers. The City of Virginia Beach provides water service to customers within the City limits through a universally metered system. A small portion of the population of the City is not served by the City's public water system. This population consists of residents living in the rural, southern end of the City, U.S. military personnel and their families living on military bases within the City, and a very small number of existing neighborhoods in the northern section of the City. By City Council policy, water and sanitary sewer service is not provided to residents in the southern part of the City. The City's comprehensive Land Use Plan provides that the southern part of the City is to remain rural with mostly farmland. The U.S. military bases in the City of Virginia Beach are customers of the City of Norfolk and they purchase their water from the City of Norfolk. The City "wheels" water to the military bases for the City of Norfolk. On -base residents (residential housing) are also customers of the City of Norfolk. Certain existing neighborhoods in the northern section of the City use wells and septic tank systems. Neighborhoods without public water and sewer service are REED, s� City of Virginia Beach CONSULTENNG Financial Feasibility Report ..... e> .. =a • *+�� 0153443 Draft Financial Feasibility Report 3-7 Princess Anne • REC AK • CONSULTING A 0' •,•I•11 PP YAlNLY rn.q[ CITY OF VIRGINIA BEACH DEPT. OF PUBLIC UTTLi11ES FINANCIAL FEASIBILITY REPORT EXISTING WATER AND SEWER SERVICE AREA APRIL 2010 FIGURE 3-2 Section 3 Water System Description decreasing as the City has extended water and sewer service to the existing neighborhoods over the past 35 years. According to the U. S. Census, the population of Virginia Beach was 425,257 in 2000. The census data for the past five decades is as follows: U. S. Census Data City of Virginia Beach Year Population 1960 69,036 1970 172,106 1980 262,199 1990 393,069 2000 425,257 A historical summary of the number of water system accounts connected to the City's water system is provided on Table 3-3. Table 3-3: Water Account History Water Water Fiscal Accounts1 Annual Accounts2 Annual Year (End of FY) Increase (Year Avg.) Increase 1994 114,952 - 114,124 1995 114,546 -0.4% 114,749 0.5% 1996 117,177 2.3% 115,862 1.0% 1997 117,403 0.2% 117,290 1.2% 1998 119,414 1.7% 118,409 1.0% 1999 120,646 1.0% 120,030 1.4% 2000 123,026 2.0% 121,836 1.5% 2001 124,630 1.3% 123,828 1.6% 2002 126,093 1.2% 125,362 1.2% 2003 127,534 1.1% 126,814 1.2% 2004 128,718 0.9% 128,126 1.0% 2005 129,376 0.5% 129,047 0.7% 2006 130,005 0.5% 129,691 0.5% 2007 130,647 0.5% 130,326 0.5% 2008 131,085 0.3% 130,866 0.4% 2009 131,367 0.2% 131,226 0.3% 'Sources:1994-2000 data from AB&H study, 2001-2009 data provided by City. 2Arithmettc average of the tw o appropriate end of fiscal year w ater accounts. RED' '. City of Virginia Beach CONSULTING Financial Feasibility Report = a.. t,.- 0153443 Draft Financial Feasibility Report 3-8 Section 3 Water System Description 3.5. Water Demand The demand for water has increased over the period from FY 1998 to FY 2008 along with residential and commercial development, whereas the average usage per account has remained relatively steady. However, a decrease in demand and the average usage per account was observed in FY 2009, as shown in Table 3-4. Average daily water use was approximately 35.4 mgd in 2008 and 33.8 mgd in 2009. The average water demand and consumption per day per account figures in 2009 were low compared to prior years, likely due to a combination of economic and weather factors. In this year, the City experienced a high property vacancy rate and relatively wet summer conditions. Growth is expected in the Courthouse / Sandbridge area and it is possible that consumption will increase in that area. Growth is also forecasted in the Kempsville and Holland areas, but demand increases are not projected to be as dramatic. Table 3-4: Water Demand History Water Avg Water Gallons/ Fiscal Accounts Demand' Day/Account2 Annual Year (Year Average) (MGD) (Year Average) Increase 1994 114,124 31.7 278 1995 114,749 31.6 275 -0.3% 1996 115,862 32.6 281 3.2% 1997 117,290 31.7 270 -2.8% 1998 118,409 32.3 273 1.9% 1999 120,030 33.9 282 5.0% 2000 121,836 33.2 272 -2.1% 2001 123,828 33.6 271 1.2% 2002 125,362 34.0 271 1.2% 2003 126,814 34.1 269 0.3% 2004 128,126 35.3 276 3.6% 2005 129,047 35.2 273 -0.3% 2006 129,691 35.4 273 0.5% 2007 130,326 35.9 276 1.4% 2008 130, 866 35.4 271 -1.4% 2009 131,226 33.8 258 -4.5% 1Sources:1994-2000 data from AB&H study, 2001-2009 data provided by OEy. 2Average Day Water Demand divided by yearly average w ater accounts. REI.J City of Virginia Beach CONSUI Tl NG Financial Feasibility Report '....A. • "AAA'. "A' 0153443 0153443 Drafi Financial Feasibility Report 3-9 Section 3 Water System Description 3.6. Inter -Governmental Agreements 3.6.1. Norfolk Water Services Contract The City signed a Water Sales Contract with the City of Norfolk in 1973 to purchase water surpluses from the City of Norfolk. This contract expired on June 30, 1993, and a new Water Sales Contract was subsequently executed and became effective July 1, 1993. This new contract was intended to provide an interim water supply to the City until the Lake Gaston Project became operational and was terminated in January of 1998, except for certain sections that remained until June 30, 1999. The existing Water Services Contract with Norfolk became effective January 1, 1998 and will expire in 2030. The Water Services Contract establishes engineering, water quality, and operational standards for the City of Norfolk to receive, treat, convey, test, and deliver potable water to the City. This contract was amended and restated in February 2001. In accordance with the Water Services Contract, a cost of service methodology is used by the City of Norfolk to develop projected rates applicable to the City for treated water service on a biennial basis. Under the "utility basis" cost of service methodology, the City pays the City of Norfolk for a proportional share of operation, maintenance, and depreciation expenses, in addition to a rate of return on assets that provide service to the City. The historical and projected average cost of service rates that the City paid and will pay for the services provided by the City of Norfolk are shown in Table 3-5. Table 3-5: Average Annual Norfolk Water Rate Charged to the City ($11,000 Gallons) Cost of Service Fiscal Year Rate Water Charge Total Rate 1997 $1.52 $0.48 $2.00 1998 $1.66 $0.56 $2.22 1999 $1.85 $0.58 $2.43 2000 $1.93 N/A $1.93 2001 $1.91 N/A $1.91 2002 $1.97 N/A $1.97 2003 $2.00 N/A $2.00 2004 $1.85 N/A $1.85 2005 $1.86 N/A $1.86 2006 $1.97 N/A $1.97 2007 $1.97 N/A $1.97 2008 $1.89 N/A $1.89 2009 $1.91 N/A $1.91 2010' $1.91 N/A $1.91 2011* $1.92 N/A $1.92 *Estimated REINA`, ` City of Virginia Beach CONSULTIN(.. Financial Feasibility Report • •...... •••_ 0153443 Draft Financial Feasibility Report 3-10 Section 3 Water System Description At the end of the second fiscal year in each biennial period, the City of Norfolk prepares and provides to the City a revised cost of service analysis for the previous two fiscal years reflecting an allocation of cost of service based on actual cost incurred by the City of Norfolk water system. The most recent allocation of actual costs has resulted in a payment to Norfolk from the City of approximately $2.6 million to be paid during the twelve month period of FY 2011. This amount represents costs incurred by Norfolk in excess of actual payments from the City during fiscal years FY 2008 and FY 2009. The City of Norfolk is contesting the true -up amounts in prior fiscal years (FY 2004 through FY 2007) which could result in the City of Virginia Beach owing the City of Norfolk approximately $4 million. However, at the time that this report was prepared, this issue was not resolved. 3.6.2. Wheeling Agreement with the U.S. Government U.S. Government establishments located in the City, including the Oceania Naval Air Force Base, and the Fort Story Army Post are water customers of the City of Norfolk. Under the terms of an agreement with the U.S. Government, the City of Virginia Beach "wheels" or transports all water purchased by the U.S. Government from the City of Norfolk for delivery through City water lines to U.S. Government establishments located within the City. The Department currently conveys approximately 1.09 mgd of treated water to these U.S. Government establishments. The Department is reimbursed for this pass-through water service at a rate that is established by the Department through a cost of service evaluation process. The current wheeling rate is $0.44 per thousand gallons. Wheeling revenues collected by the Department amount to less than $200,000 annually. 3.7. Existing Water Rates The Department's historical and current water rate structure consists of a minimum service availability charge that varies based upon meter size and a uniform water commodity rate for all customers. The service availability charge does not include any volume of water, and the commodity rate is charged for each unit volume that is consumed. The Department also charges a separate wheeling charge for wheeling water to the military bases. A summary of the historical, existing, and adopted water rates is provided in Table 3-6. .'� *.7 [ UIs A K City of Virginia Beach .. CONSULTING Financial Feasibility Report 6,...a. _.. • •,—. 0153443 Draft Financial Feasibility Report Section 3 Water System Description Table 3-6: Summary of Historical and Existing Water Rates Water Minimum Service Availability Charges Meter Size $ per Month (inches) FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 5/8 $3.75 $4.10 $4.10 $4.10 $4.10 3/4 $4.80 $5.25 $5.25 $5.25 $5.25 1 $6.90 $7.60 $7.60 $7.60 $7.60 1 - 1/2 $12.05 $13.25 $13.25 $13.25 $13.25 2 $18.30 $20.10 $20.10 $20.10 $20.10 3 $32.75 $36.00 $36.00 $36.00 $36.00 4 $53.50 $58.70 $58.70 $58.70 $58.70 6 $106.00 $116.00 $116.00 $116.00 $116.00 8 $167.00 $184.00 $184.00 $184.00 $184.00 10 $240.00 $264.00 $264.00 $264.00 $264.00 12 $447.00 $491.00 $491.00 $491.00 $491.00 Water Commodity Rates Water Rates Retail Rate Wheeling Charge $ per 1,000 gallons FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 $3.65 $3.70 $3.80 $3.95 $4.10 $0.44 $0.44 $0.44 $0.44 $0.44 In addition to the water rates identified above, the City currently charges a Water Resource Recovery Fee of $92 per drainage fixture unit. This is a one-time fee charged to all new connections to the City's water system at the time a building permit is issued. Historically, this fee provided an additional funding source for financing a portion of the costs of the Lake Gaston water supply project. The fee paid by the property owner represents their share of a portion of the cost of water resources development and "backbone" distribution facilities. Over the last five years, the Water Resource Recovery Fee has generated between approximately $1.7 million and $3.9 million per year. REM' CONSULTING City of Virginia Beach Financial Feasibility Report 0153443 Draft Financial Feasibility Report 3-12 4. Sanitary Sewer System Description 4.1. History of Sanitary Sewer System The sanitary sewer system originated in 1906, the year the Town of Virginia Beach was incorporated. At that time, the then "Town" took over operation of the facilities that were constructed at the end of the nineteenth century along the ocean front, and additional pumping stations and treatment facilities were constructed. In 1938, a wastewater treatment plant was constructed, and this plant treated City wastewater until 1969. In 1969, connection with the Hampton Roads Sanitation District ("HRSD") system was made and wastewater treatment by the City was phased out. The City's existing sanitary sewer system includes collector lines, force mains, and pump stations to transport wastewater to the HRSD facilities. The HRSD was created on November 5, 1940, and began wastewater collection and treatment operations on July 1, 1946. Since its creation, the HRSD has grown to provide sanitary service treatment to all major population centers within its boundaries. Currently the District serves 17 cities and counties in southeastern Virginia. The HRSD treats only sanitary sewer wastewater and does not treat any stormwater or combined sewer wastewater. In 2007, the City, together with the HRSD, the cities of Chesapeake, Hampton, Newport News, Poquoson, Portsmouth, Suffolk, and Williamsburg, the counties of Gloucester, Isle of Wight, and York, the James City Service Authority, and the Town of Smithfield, was issued a Special Order by Consent' (the "Consent Order") from the Virginia Department of Environmental Quality ("DEQ") regarding the discharge of untreated sewage from various locations in the HRSD System and the individual sanitary sewer collection systems. As required by the Consent Order, the City, as well as the other named communities, has agreed to a two -phased approach to an initiative that will address the regional and individual sanitary sewer collection system capacity and performance conditions that cause or contribute to the discharge of sewage. The first phase is principally a data collection, evaluation, and plan development program that consists of both regional and individual elements. The regional element requires the use of uniform standards to State Water Control Board Enforcement Action, Special Order by Consent, Issued to the Hampton Roads Sanitation District, the cities of Chesapeake, Hampton, Newport News, Poquoson, Portsmouth, Suffolk, Virginia Beach and Williamsburg; the counties of Gloucester, Isle of Wight, and York: the James City Service Authority, and the Town of Smithfield, executed in September 2007. REE )A K City of Virginia Beach CCNSU LT NG Financial Feasibility Report 0153443 Draft Financial Feasibility Report 4-1 1 Section 4 Sanitary Sewer System Description identify the infrastructure projects needed to provide the collection system, interceptor system and treatment capacity required to cost-effectively manage peak wet weather flows throughout the Hampton Roads sanitary sewer system. The individual system elements are designed to identify, characterize, and cost-effectively address conditions that contribute to sewage discharges. The second phase will provide for the implementation of long-term capacity enhancement and sewer rehabilitation plans, including construction of the regional infrastructure projects and individual system improvements indentified in the first phase. In 2007, the City entered into a Memorandum of Understanding with the HRSD2 for the purposes of defining the roles, responsibilities, and obligations regarding compliance with the Regional Technical Standards contained in the Consent Order, establishing procedures of the sharing of data and information, and establishing procedures to be followed for requesting modifications to the regional consent order. The City has completed much of the work required under the first phase. City has prepared and provided the Virginia DEQ with a Sewer System Evaluation Survey ("SSES") plan, as well as a Management, Operations and Maintenance ("MOM") program. The MOM program provides a formal documented approach for the Department to: • Effectively manage, operate and maintain sanitary sewer system • Investigate capacity constrained areas of the sanitary sewer system • Proactively prevent sanitary sewer overflows (SSOs) • Respond to SSO events. In addition, over the past several years, the Department has completed sewer rehabilitation capital projects to address aging infrastructure and inflow/infiltration issues. Furthermore, the Department's capital program discussed in Section 5 includes capital projects to address the issues related to the Consent Order. 4.2. Sanitary Sewer System Description The City's existing sanitary sewer system includes collector lines, force mains and pump stations to transport wastewater to the HRSD facilities. The City's sanitary sewer collection system is a separate system and does not collect combined sanitary and stormwater. As of June 30, 2009, the City's sanitary sewer system consisted of 1,621 2 Memorandum of Agreement between the Hampton Roads Sanitation District, the cities of Chesapeake, Hampton, Newport News, Poquoson, Portsmouth, Suffolk, Virginia Beach, and Williamsburg, the Town of Smithfield, and the counties of Gloucester, Isle of Wight, and York, and the James City Service Authority, and the Hampton Roads Planning District Commission, dated June 28, 2007. REIDA,A, K City of Virginia Beach )f' 1 f LT NG Financial Feasibility Report <==3,. •,. 0153443 Draft Financial Feasibility Report 4-2 Section 4 Sanitary Sewer System Description miles of pipeline, ranging in size from 4 to 36 inches in diameter, 129,084 connections and 405 sewage pumping stations. The City's topography is very flat necessitating the use of pumping stations to deliver sanitary sewage to the HRSD. A summary of the sanitary sewer pump stations and their associated capacity is provided in Table 4-1. Approximately 150 of the 405 pumping stations are greater than 25 years old. Groundwater and stormwater inflow/infiltration are kept to a minimum by the Department maintaining an active inflow/infiltration prevention program. The Department also has an actively enforced mandatory connection program. Where service is available, property owners are required to connect to the sanitary sewer collection system. Sanitary Sewer Table 4-1: Pump Station Summary Capacity GPM 100-200 200-300 300-400 400-500 500-600 600-700 700-800 800-900 900-1000 1000-1100 1100-1200 1200-1300 Pump Stations 38 66 55 47 39 34 20 18 9 13 12 17 Capacity Pump GPM Stations 1300-1400 6 1400-1500 6 1500-1577 4 1577-1620 5 1620-1800 1 1800-2000 4 2000-2083 2 2083-2200 2 2200-2250 1 2250-2900 1 2900-4000 1 >4000 1 GPM = gallons per minute. The wastewater that is collected from City customers is conveyed to the HRSD for treatment. HRSD operates nine treatment facilities in Hampton Roads and four smaller treatment facilities on the Middle Peninsula. Two of the nine Hampton Roads facilities are located within the City of Virginia Beach. The Chesapeake -Elizabeth and the Atlantic plants have a combined operating capacity of 60 mgd with estimated current annual flows of 47 mgd. Both plants were designed for expanded capacity. HRSD is planning to expand the Atlantic plant from 36 mgd to 54 mgd. Final completion is planned for September 2010. REI DA K City of Virginia Beach CONSU L`l'1 NG Financial Feasibility Report ---= 0153443 Draft Financial Feasibility Report Section 4 Sanitary Sewer System Description 4.3. Sanitary Sewer System Condition A visual inspection of the sewer system facilities was made on March 3, 2010. This inspection was limited to a visual inspection of a representative sample of sewer system facilities, including sewer pump stations and operations facilities. Based on visual inspections, the sewer system is in good working condition. However, a detailed condition assessment was not completed as part of the inspections. Completion of a comprehensive condition assessment program, which includes assessment of gravity sewers, manholes, pump stations and force mains, has been initiated. Defects identified through the condition assessment program will be prioritized and addressed through either in-house or contracted forces. The Department is committed to implementing short- and long-term refurbishment and replacement programs for the sanitary sewer infrastructure. It is estimated that the more detailed sewer system condition assessment will be completed over the next two to three years. 4.4. Sanitary Sewer System Service Area The sanitary sewer system service area is located within the northern half of the City boundaries, and is approximately 160 square miles in size. The population served by the sanitary sewer system is approximately 425,977. A portion of the population of the City is not served by the City's public sanitary sewer system. This population includes residents in the southern part of the City, residents in a limited number of existing neighborhoods in the northern part of the City, and U.S. military personnel and their families living on U.S. military bases. A historical summary of the number of sanitary sewer system accounts connected to the City's sewer system is provided on Table 4-2. A K City of Virginia Beach CONSUL 1 ENG Financial Feasibility Report • • • _• •�«• - • • 0153443 Draft Financial Feasibility Report 44 Section 4 Sanitary Sewer System Description Table 4-2: Sewer Account History Sewer Sewer Fiscal Accounts[ Annual Accounts2 Annual Year (End of FY) Increase (Year Average) Increase 1994 110,637 109,596 1995 111,806 1.1% 111,222 1.5% 1996 113,916 1.9% 112,861 1.5% 1997 116,433 2.2% 115,175 2.0% 1998 117,749 1.1% 117,091 1.7% 1999 119,540 1.5% 118,645 1.3% 2000 121,397 1.6% 120,469 1.5% 2001 122,779 1.1% 122,088 1.3% 2002 124,172 1.1% 123,476 1.1% 2003 125,436 1.0% 124,804 1.1% 2004 126,302 0.7% 125,869 0.9% 2005 126,908 0.5% 126,605 0.6% 2006 127,578 0.5% 127,243 0.5% 2007 128,220 0.5% 127,899 0.5% 2008 128,826 0.5% 128,523 0.5% 2009 129,084 0.2% 128,955 0.3% 1Sources:1994-2000 data from AB&H study, 2001-2009 data provided by City. 2Arithmetic average of the two appropriate end of fiscal year water accounts. 4.5. Existing Sanitary Sewer Rates The City's historical and existing sewer rate structure consists of a monthly, flat maintenance charge for sanitary sewer collection to the City, which differs based on customer type. A summary of the historical and existing sewer maintenance charges is provided in Table 4-3. The City's sewer customers also pay wastewater user fees directly to HRSD for wastewater treatment. • ::• REID)A K City of Virginia Beach • • ; CONSULTING Financial Feasibility Report • ..,.,..o. o, ..,,.,....a., 0153443 Draft Financial Feasibility Repon Section 4 Sanitary Sewer System Description Table 4-3: Summary of Historical and Existing Sewer Rates Sewer Maintenance Charges $ per Month Description FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 Adopted Annual Sewer Rate Increase 6.00% 5.00% 5.00% 5.00% Residential Uses: a. Single Family residences: b. Structures with 2 or more residential units First unit or trailer Each additional unit or trailer $15.92 $16.88 $17.72 $18.61 $19.54 $15.92 $16.88 $17.72 $18.61 $19.54 $11.94 $12.66 $13.29 813,95 $14.65 c. Hotels & Motels For the first room provided for occupancy $15.92 $16.88 $17.72 $18.61 $19.54 Each additional room for occupancy $6.39 $6.77 $7.11 $7.47 $7.84 d. Campgrounds For the first space provided $15.92 $16.00 $17.72 $18.61 $19.54 For each additional space provided $6.39 $6.77 $7.11 $7.47 $7.84 e. Structures or property with 2 or more family residential units with separate water meters $15.92 $16.88 $17.72 $18.61 $19.54 serving each or any individual units Nonresidential Uses: a. For all nonresidential uses in which there is also supplied public water service: Tap Size (Inches) 3/4 $15.98 $16.94 $17.79 $18.68 $19.61 1 $20.18 $21.39 $22.46 $23.58 $24.76 1 1/2 $39.95 $42.35 $44.47 $46.69 $49.02 2 $60.55 $64.18 $67.39 $70.76 $74.30 3 $118.86 $125.99 $132.29 $138.90 $145.85 4 $198.56 $210.47 $220.99 $232.04 $24a64 6 8398.51 $422.42 $443.54 $465.72 $489.01 8 $925.66 $981.20 $1,030 $1,082 $1,136 10 $1,531 $1,623 $1,704 $1,789 $1,879 12 $2,321 $2,460 $2,583 $2,713 $2,848 b. For all nonresidential uses in which public water service is not available: 0-4 commodes Each additional commode over 4 $31.95 $33.87 $35.56 $37.34 $39.21 $6.39 $6.77 $7.11 $7.47 $7.84 RE_` P City of Virginia Beach CONSUUTl i , Financial Feasibility Report • o....,e- oo- 0153443 Draft Financial Feasibility Report 5. Capital Improvement Plan 5.1. Introduction The Capital Improvement Plan ("CIP") developed by the Department consists of planned design, construction, maintenance, and repair of facilities and infrastructure projects, associated costs, and schedules for implementation. Initiation of some of these projects has already begun, and will continue over the next several years. A summary of the planned CIP cost over the period FY 2010 through FY 2015 is provided in Table 5-1. As shown, the Department plans to spend approximately $39 million in FY 2010, $25 million in FY 2011, and $40 million per year on water and sewer CIP projects in FY 2012 through FY 2015, with the majority of these projects being sanitary sewer system related. Water Table 5-1: and Sewer Capital Improvement Plan Fiscal Year 2010 2011 2012 2013 2014 2015 Water Projects $ 6,173,000 $ 4,770,271 $ 8,407,000 $ 11,524,000 $ 9,280,000 $ 6,601,000 Sevier Projects $ 32,881,900 $ 20,229,729 $ 31,593,000 $ 28,476,000 $ 30,720,000 $ 33,399,000 Total Projects $ 39,054,900 $ 25,000,000 $ 40,000,000 $ 40,000,000 $ 40,000,000 $ 40,000,000 5.2. Description of Water System Projects The water system CIP is reviewed each year by the City Council and the Department of Public Utilities. The selected water system projects are necessary to continue to provide adequate water service. The water system projects are selected and ranked by the Department based on the following criteria: health and safety, urgency, service and benefit, budget impact, comprehensive plan compatibility, quality of life, and water request and agreement projects. The proceeds of the Series 2010 Bonds for water utility projects are proposed to be used, together with other funds, for the following purposes: City of Virginia Beach CONSULTING Financial Feasibility Report .. ,.. ,. fl...,<..... , 0153443 Draft Financial Feasibility Report 5-1 Section 5 Capital Improvement Plan • Construction of new water mains • Improvement and replacement of existing water mains • Storage tank improvements • Pump station modifications • Fire hydrant program • Landstown yard improvements • Backflow prevention/cross connection program • Comprehensive emergency response and training • Water supply improvements and evaluations • Comprehensive water master planning • Flow monitoring system • Water quality program • Water appurtenance evaluation • Various water infrastructure maintenance support program • Mapping and infrastructure management system • Public Utilities public access renovation building #2 • Customer information system replacement • Water SCADA upgrade 5.3. Description of Sanitary Sewer Projects The projects associated with the sanitary sewer utility CIP are necessary to continue to provide adequate sanitary sewer service and satisfy the requirements of the Consent Order. The sanitary sewer utility projects are evaluated and ranked by the Department based on the following criteria: health and safety, urgency, service and benefit, budget impact, comprehensive plan compatibility and quality of life. The proceeds of the Series 2010 Bonds for sanitary sewer utility projects are expected to be used, together with other funds, for the following purposes: • Construction of new gravity sanitary sewers, force mains and pumping stations • Rehabilitations of existing sanitary sewers • Modification of existing pumping stations • Sewer system evaluation and rehabilitation • Computerized mapping system and infrastructure management system • Infiltration, inflow and rehabilitation • Landstown yard improvements • Comprehensive sewer study • Auxiliary power program/sewer pump stations • Customer information system replacement RED City of Virginia Beach CONSULTING Financial Feasibility Report >,.. �« .. .,�...... , 0153443 Draft Financial Feasibility Report 5-2 Section 5 Capital Improvement Plan • Comprehensive emergency response and planning • Sewer SCADA system upgrade • Sanitary sewer revitalization program • Sanitary sewer system infrastructure program • REID K City of Virginia Beach • CONSULTING Financial Feasibility Report • *. 0153443 Draft Financial Feasibility Report I 6. Financial Feasibility As part of this bond feasibility study, Red Oak prepared a financial plan and forecast for the Department's Water and Sewer Fund. The purpose of this section is to present the financial plan and forecast, the projection of revenues and expenses, retained earnings, and coverage, and document the assumptions used in the preparation of the forecast in order to provide an opinion as to the feasibility of the Series 2010 Water and Sewer Revenue Bonds. The financial forecast represents an estimate of the probable results of operations and reflects the Department's judgment as to the most likely set of conditions and course of action based upon present circumstances. Red Oak worked closely with the Department to obtain the information necessary to prepare the financial forecast, and various financial and system information was provided by the Department to support the development of the financial forecast. 6.1. Historical and Projected Revenues Historical Water and Sewer Fund revenues from fiscal year FY 2005 through FY 2009 were reviewed along with budget projections prepared and provided by the Department to develop projections of revenues for the period FY 2010 through FY 2015. Revenues include water and sewer rate revenues, tap fees, fire hydrant fees, wheeling charges, water resources recovery fees, sewer main and line extension fees, and miscellaneous fees and charges. These revenues are used to recover the costs of operating and maintaining the water and sewer systems and provide service to existing and new customers. 6.1.1. Historical Revenues Table 6-1 presents historical revenues on a full accrual basis for FY 2005 through FY 2009. 6.1.2. Projected Revenues Projections of future revenues were made based upon historical information, discussions of revenue trends with the Department, and projections of customer growth rates. Customer growth rates were forecasted based upon a review of historical billed flow, amount of historical revenue collected, and discussions with the Department regarding the expected future customer growth rates. REED City of Virginia Beach CONSULTING ING Financial Feasibility Report • .. ..............,. 0153443 Draft Financial Feasibility Report Section 6 Financial Feasibility Table 6-1: Historical Water and Sewer Revenues Historical Revenues (in Thousands) Description FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 Revenues Water Usage Charges $ 41,169 $ 43,176 $ 44,071 $ 44,503 $ 44,286 Serice Charges 35,341 40,120 43,140 45,484 47,430 WRAF and Extension Fees 3,481 3,916 3,474 2,999 1,747 Sewer Connection Fees 1,644 1,640 1,752 1,271 774 Tap and Meter Fees 175 173 285 403 343 Wheeling Charge 195 211 163 196 150 Norfolk True -up (1,595) 797 1,898 Miscellaneous 311 304 367 164 406 Interest Income 1,809 3,427 5,290 5,045 2,368 Total Revenues $ 84,124 $ 91,371 $ 99,338 $ 101,963 $ 97,504 6.1.2.1. Projected Water and Sewer Accounts and Water Demand The projection of water accounts, billed water flow, and billed consumption per account is provided on Table 6-2. The projection of sewer accounts is provided on Table 6-3. Historical water and sewer accounts, water demand, and demand per account are shown in Section 3 on Table 3-3, Table 3-4 and REI) K City of Virginia Beach CONSULTING Financial Feasibility Report • + +>_+., ._ a=+ +*t< 0153443 Draft Financial Feasibility Report 6-2 Section 6 Financial Feasibility Table 4-2. The water and sewer account projection assumes the addition of approximately 290 new water accounts in FY 2010, 450 in FY 2011 and 600 per year in FY 2012 through FY 2015, based on historical trends. The average water usage per account projection assumes a partial rebound from historical lows in FY 2009 to approximately 10 gallons per day per account below the historical average usage per account per day from FY 1994 to FY 2009. Table 6-2: Projection of Water Accounts and Billed Water Consumption Fiscal Year 2010 2011 2012 2013 2014 2015 Water Accounts (Year Average) 131,517 131,967 132,567 133,167 133,767 134,367 Avg Water Gallons/ Annual Demand Day/Account Annual Increase (MGD) (Year Average) Increase 0.2% 34.0 0.3% 34.3 0.5% 34.7 0.5% 35.2 0.5% 35.4 0.4% 35.6 259 260 262 264 265 265 0.5% 0.9% 1.2% 1.2% 0.8% 0.4% REI CONSULTING .64 DP N.I LttN .isN�, City of Virginia Beach Financial Feasibility Report 0153443 Draft Financial Feasibility Repon 6-3 Section 6 Financial Feasibility Table 6-3: Projection of Sewer Accounts Sewer Sewer Fiscal Accounts Annual Accounts Annual Year (End of FY) Increase (Year Average) Increase 2010 129,384 0.2% 129,234 0.2% 2011 129,984 0.5% 129,684 0.3% 2012 130,584 0.5% 130,284 0.5% 2013 131,184 0.5% 130,884 0.5% 2014 131,784 0.5% 131,484 0.5% 2015 132,384 0.5% 132,084 0.5% 6.1.2.2. Projected Water and Sewer Rates In the most recent water and sewer cost of service study report, prepared by Red Oak and dated October 21, 2009 (the "2009 Cost of Service Study"), it was anticipated that the adopted water rates for FY 2010 would be adequate to recover the cost of providing water service through the period of FY 2011 through FY 2014. Furthermore, increases to the FY 2010 sewer rate in the range of 10 percent to 13 percent per year were projected to be needed over the period from FY 2011 through FY 2014 depending upon whether annual capital spending over the period was $35 million or $40 million per year. Subsequent to the completion of the 2009 Cost of Service Study, a General Fund transfer for the use of the City's right-of-way was enacted, which will necessitate the transfer of an additional $4 million per year from the Water and Sewer Fund to the General Fund annually for use of the right-of-way; the transfer is expected to start in FY 2011. This transfer is in accordance with the Ninth Supplemental Resolution, which includes an amendment to the Master Bond Resolution that allows annual transfers from the Residual Account to the City's General Fund as payments in lieu of taxes in an amount equal to the lesser of $4 million and 15 percent of the net assets restricted for operations. Prior to this amendment, Fund transfers were limited to an amount not to exceed 2 percent of the increase in retained earnings of the Fund from year-to-year,3 The transfers from the Residual Account are permitted only after the payment of bond debt service. Refer to the Ninth Supplemental Resolution and the Preliminary Official Statement for more information. 3 Ninth Supplemental Resolution Supplementing and Amending Resolution Adopted February 11, 1992, Entitled "Master Water And Sewer Revenue Bond Resolution Providing For The Issuance From Time to Time of One or More Series of Water and Sewer System Revenue Bonds of the City of Virginia Beach", Adopted in 2010, RE©'AK CONSULTING City of Virginia Beach Financial Feasibility Report 0153443 Draft Financial Feasibility Report Section 6 Financial Feasibility The Department anticipates funding this transfer to the General Fund with the addition of a fee that will effectively add $0.31 per 1,000 gallons to the Water Commodity Rate and $0.31 to the Water Service Availability Charge (for each meter size). Therefore, it is anticipated that the City Council will adopt the water rates shown in Table 6-4 for the period FY 2011 through FY 2015. Table 6-4: Anticipated Water Rates FY 2011 Through FY 2015 Water Minimum Service Availability Charges Meter Size Adopted Anticipated (inches) FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 $ per Month 5/8 $4.10 $4.41 $4.41 $4.41 $4.41 $4.41 3/4 $5.25 $5,56 $5.56 $5.56 $5.56 $5.56 1 $7.60 $7.91 $7.91 $7.91 $7.91 $7.91 1 - 1/2 $13.25 $13.56 $13.56 $13.56 $13.56 $13.56 2 $20.10 $20.41 $20.41 $20.41 $20.41 $20.41 3 $36.00 $36.31 $36.31 $36.31 $36.31 $36.31 4 $58.70 $59.01 $59.01 $59.01 $59.01 $59.01 6 $116.00 $116.31 $116.31 $116.31 $116.31 $116.31 8 $184.00 $184.31 $184.31 $184.31 $184.31 $184.31 10 $264.00 $264.31 $264.31 $264.31 $264.31 $264.31 12 $491.00 $491.31 $491.31 $491.31 $491.31 $491.31 Water Commodity Rates Adopted Anticipated Water Rates FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 $ per 1,000 gallons Retail Rate $4.10 $4.41 $4.41 $4.41 $4.41 $4.41 Wheeling Charge $0.44 $0.44 $0.44 $0.44 $0.44 $0.44 It is also anticipated that City Council will adopt the sewer rates shown in Table 6-5 for the period FY 2011 through FY 2015, which reflect rate increases of approximately 13.3 percent, 12.4 percent, 11.7 percent, and 11.0 percent in fiscal years FY 2012, FY 2013, FY 2014, and 2015, respectively. RED) +' " City of Virginia Beach CONSU LTI NG Financial Feasibility Report 0153443 Draft Financial Feasibility Report Section 6 Financial Feasibility Table 6-5: Anticipated Sewer Rates FY 2011Through FY 2015 Sewer Maintenance Charges Description Adopted Annual Sewer Rate Increase Residential Uses: a. Single Family residences: b. Structures with 2 or more residential units First unit or trailer Each additional unit or trailer Adopted Anticipated FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 $ per Month 0.00% 13.30% 12.40% 11.70% 11.00% $19.54 $19.54 $22.12 $24.86 $27.76 $30.81 $19.54 $19.54 $22.12 $24.86 $27.76 $30.81 $14.65 $14.65 $16.60 $18.66 $20.83 $23.12 c. Hotels & Motels For the first room provided for occupancy $19.54 $19.54 $22.12 $24.86 $27.76 $30.81 Each additional room for occupancy $7.84 $7.84 $8.89 $9.99 $11.15 $12.38 d. Campgrounds For the first space provided For each additional space provided $19.54 $19.54 $22.12 $24.86 $27.76 $30.81 $7.84 $7.84 $8.89 $9.99 $11.15 $12.38 e. Structures or property with 2 or more family residential units with separate water meters $19.54 $19.54 $22.12 $24.86 $27.76 $30.81 serving each or any individual units Nonresidential Uses: a. For all nonresidential uses in which there Is also supplied public water service: Tap Size (Inches) 3/4 $19.61 $19.61 $22.21 $24.97 $28.06 $31.15 1 $24.76 $24.76 $28.04 $31.52 $35.43 $39.32 11/2 $49.02 $49.02 $55.52 $62.40 $70.14 $77.84 2 $74.30 $74.30 $84.15 $95.58 $106.31 $117.98 3 $145.85 $145.85 $165.18 $185.66 $208.68 $231.60 4 $243.64 $243.64 $275.94 $310.16 $348.61 $386.89 6 $489.01 $489.01 $553.83 $622.50 $699.67 $776.51 8 $1,136 $1,136 $1,286 $1,446 $1,625 $1,804 10 $1,879 $1,879 $2,128 $2,392 $2,688 $2,983 12 $2,848 $2,848 $3,226 $3,626 $4,075 $4,523 b. For all nonresidential uses in which public water service is not available: 0-4 commodes Each additional commode over 4 $39.21 $39.21 $44.40 $49.90 $55.72 $61.83 $7.84 $7.84 $8.89 $9.99 $11.15 $12.38 • . ; REIDM u City of Virginia Beach • • . • CONSU LTj NG Financial Feasibility Report • • 0153443 Draft Financial Feasibility Report 6-6 1 6-7 J I II Section 6 Financial Feasibility 6.1.3. Projected Rate Revenues The Department's largest source of revenue is from water and sewer rates. The revenue projections assume that a $0.31 increases in the water commodity rate and the availability charges is implemented on July 1, 2010, and 13.3 percent, 12.4 percent, 11.7 percent, and 11.0 percent increases in the sewer rates are implemented at the beginning of fiscal years FY 2012, FY 2013, FY 2014, and FY 2015, respectively. The projection also assumes that the growth in water and sewer accounts, and water demand occurs as forecasted. The projected water and sewer rate revenues are shown at the end of this section on Table 6-6. 6.1.4. Projected Other Revenues The Department receives revenue from other sources including tap fees, wheeling charges, water resources recovery fees, sewer main and line extension fees, interest, and miscellaneous fees and charges. A summary of these revenues and revenue projection assumptions is provided below. Projected revenues are shown at the end of this section on Table 6-6. Water Resource Recovery Fees Sewer Connection Fees Tap Fees Water resource recovery fees are currently $92 per drainage fixture unit ("DFU"). The projection of revenues was developed by multiplying this fee by the anticipated number of new DFUs based on projections of new connections. No increase in the fees was assumed over the forecast period. Sewer connection fee consists of a sewer main extension fee of $59 per DFU (assessed when the City makes the connection), and a sewer line extension fee of $0.13 per DFU (assessed when a developer makes the connection). The projection of revenues was developed by multiplying the fee by the anticipated number of new DFUs based on the projection of new connections. No increase in the fee was assumed over the forecast period. Water tap fees are currently $285 per 5/8- and 44- inch connections, and sewer tap fees are $450 for a 2 -inch tap. The projection of revenues was developed by multiplying the tap fees by the anticipated number of new connections. No increase in the tap fees was assumed over the forecast period. REIN City of Virginia Beach CONSULTING Financial Feasibility Report A ' " .A.=... • •^ 0153443 Drab Financial Feasibility Report Section 6 Financial Feasibility Wheeling Charges Interest Earnings Miscellaneous The wheeling charge assessed to the Army and Navy for wheeling water from the City of Norfolk is $0.44 per 1,000 gallons. The forecast assumes approximately 341,200 thousand gallons will be wheeled annually and the charge will remain the same over the forecast period. Interest earnings were calculated based on the average beginning and ending balance of retained earnings, and an assumed interest rate of approximately 2.0 percent in FY2010 and 3.0 percent thereafter. Current and historical interest earnings were the basis for this projection. Miscellaneous charges include fire hydrant rentals, water turn on fees, new account service fees, antennae rentals, water meter fees, inspection fees, and other miscellaneous revenues. It is anticipated that revenues from water meter, new account service fees and turn -on fees will increase commensurate with the rate of growth, and it was assumed that other revenues will remain constant over the forecast period. 6.2. Historical and Projected O&M Expense Water and sewer system expenses include operating expenses (e.g., personneI, benefits, internal services, materials and supplies, contractual services, leases & rentals, and other expenses), and non-operating expenses (e.g., debt service, and capital outlay). Detailed projections of operating expenses were developed based upon discussions with the Department regarding system operational changes, historical cost trends, and anticipated future water and wastewater flows. Based upon an analysis of this information, the following operating expense projections were made: Expense Category Personnel Fringe Benefits Internal Services Annual % Increase Basis / Rationale 4.0 Historical trends and City input based on the impact of the sanitary sewer consent order compliance. 6.0 Projected health care and retirement growth plus inflation. Projected cost inflation based upon historical 3.0 Engineering News Record (ENR) and consumer price index (CPI) regional trends. REB)A K City of Virginia Beach CONSULTING Financial Feasibility Report • 0153443 Draft Financial Feasibility Report 6-8 Materials and Supplies 3.0 Projected cost inflation. Section 6 Financial Feasibility Contract Services - Based upon anticipated water purchase cost Purchased Water 2'0 increases from the City of Norfolk. All other 3.0 Projected cost inflation. In addition to these annual operating expense increases, an incremental increase in the Engineering Department totaling $1.2 million was included in the forecast over a two year period from FY 2012 to FY 2013 associated with the addition of approximately three engineering positions and additional contract services for managing a larger sewer capital program. An incremental increase in expenses associated with sewer collection system and pump station operation and maintenance totaling $3.3 million was included over a two year period from FY 2012 to FY 2013. In addition, an additional General Fund transfer in the amount of $4 million was included in the forecast beginning in FY 2011 associated with the use of the City's right -a -way. A detailed projection of non-operating expenditures was developed based upon a review of existing debt obligations, discussions with the City regarding anticipated capital outlay requirements, and historical cost trends. Based upon an analysis of this information, the following non-operating expense projections were made: • Existing debt repayment obligations over the next five years consist of principal and interest payments associated with Water and Sewer Revenue Bonds. In addition, it is anticipated that the City will issue new revenue bond debt to finance a portion of the anticipated capital improvement program in accordance with the City's debt management policies. • Capital outlay is projected to increase at an inflationary rate of approximately 3.0 percent over the period from FY 2012 through FY 2015, based on assumed cost inflation. Capital outlay was projected to be higher in FY 2010 than historical and projected amounts due to increases in rolling stock replacements. Capital outlay includes furnishings and equipment purchases, contract services, and general facility improvements. 6.3. Capital Improvement Plan Funding The Department plans to fund approximately $65 million in water and sewer utility projects with the proceeds of the Series 2010 Water and Sewer Revenue Bonds. Water utility projects to be funded from a portion of the Series 2010 Bonds total approximately $17.8 million. Of that amount, approximately $9.2 million is designated for REsM CONSULTING A ,11.11,11 Mlle0110 1.1111.1 City of Virginia Beach Financial Feasibility Report 0153443 Draft Financial Feasibility Report N II Section 6 Financial Feasibility reimbursement of funds expended as part of past CIP projects. The balance of $8.6 million includes portions of the current CIP. Sanitary sewer utility projects to be funded from a portion of the Series 2010 Bonds total approximately $47.2 million. Of that amount, approximately $30.7 million is designated for reimbursement of funds expended as part of past CIP projects. The balance of $16.5 million includes portions of the current CIP. In FY 2010, approximately $17.0 million of the $39.0 million water and sewer CIP, or approximately 43.6 percent, will be funded with the proceeds of the Series 2010 Water and Sewer Revenue Bonds. In FY 2011, it is anticipated that approximately $12.15 million of the $25.0 million water and sewer CIP, or approximately 48.6 percent, will be funded with the proceeds of the Series 2010 Water and Sewer Revenue Bonds. The Department anticipates funding the remaining project costs in FY 2010 and FY 2011 with a combination of retained earnings and current operating revenues. In FY 2012 through FY 2015, the Department plans to fund the capital projects in the CIP with a combination of additional debt, retained earnings and current operating revenues. The Department anticipates that approximately $27 million or 68 percent of the CIP in these years will be funded with debt, and approximately $13 million or 32 percent will be funded with retained earnings (i.e. unrestricted cash) and current operating revenues. 6.4. Historic and Projected Debt Service As previously discussed, the Series 2010 Water and Sewer Revenue Bonds will be issued to fund the Department's CIP. The proceeds of the Series 2010 bonds will be used to (1) fund a portion of the cost associated with the FY 2011 CIP, (2) fund a portion of the CIP expenditures that were incurred in FY 2010. For more information, refer to the sources and uses section of the Official Statement. Table 6-6 and 6-7 at the end of this section summarizes the existing and proposed debt service obligations over the forecast period. Outstanding debt service information was provided by the Department, and the debt service associated with the Series 2010 Water and Sewer Revenue Bonds was provided by the City's financial advisor. It was assumed that approximately $27 million in capital projects in each fiscal year from FY 2012 through FY 2015 will be funded with new debt. For the purposes of projecting new debt service in FY 2012 through FY 2015, an interest rate of 6.0 percent and a amortization period of 25 years was assumed. 6.4.1. Debt Service Coverage Requirements The Master Water and Sewer Revenue Bond Resolution (the "Master Bond Resolution"), which was adopted on February 11, 1992, contains specific debt service coverage REQ ` City of Virginia Beach CONSULTING Financial Feasibility Report 4 0153443 Draft Financial Feasibility Report Section 6 Financial Feasibility requirements that must be met by the Water and Sewer Fund. The revenue covenant requires the following: The City shall fix, charge and collect such rates, fees and other charges for the use of and for the services furnished by the System, and shall, from time to time and as often as shall appear necessary, revise such rates, fees, and other charges so as to meet the following two independent requirements: a) Revenues shall be sufficient in each Fiscal Year to equal the sum of (1) the Operating Expenses shown in the Annual Operating Budget for such Fiscal Year, and (2) (A) 11 S percent of the sum of Maximum Annual Debt Service and Maximum Annual Prior Parity Bond Debt Service, and (B) 100 percent of Maximum Annual Additional Parity Debt Service. b) Revenues shall be sufficient in each Fiscal Year to equal the sum of (1) the Operating Expenses shown in the Annual Operating Budget for such Fiscal Year, (2) the amount required to be paid into the Renewal and Replacement Account in such Fiscal Year, (3) the amount required to be paid into the Revenue Bond Fund in such Fiscal Year, (4) the amount required to be paid into the Parity Double Barrel Bond Fund in such Fiscal Year, (5) the amount required to be paid into the Parity Debt Service Component Fund in such Fiscal Year, (6) the amount required to be paid into the Subordinate Debt Fund in such Fiscal year, (7) the amount of any other indebtedness of the city attributable to the System that is required to be paid in such Fiscal Year, (8) the amount transferred to the Capital Improvement Account for the immediately preceding Fiscal Year or such other amount as may be determined by the Director of Public Utilities to be appropriate for the System, and (9) any amount necessary to be paid into any Series Debt Service Reserve Account to restore the amount on deposit therein to the amount of the Series Debt Service Reserve Requirement. The required deposits and uses of each of the funds described in paragraph b) are described in detail in the Master Bond Resolution. The fund deposit requirement for the Renewal and Replacement Account is "one -twelfth of $2,000,000 (per month) or such larger amount as may be recommended by the Consulting Engineer and approved by Council" per the Master Bond Resolution. Based on the debt service coverage projections shown in Table 6-7, it is anticipated that the Department's debt service coverage pertaining to requirement a) and b) identified above will be met in each year of the five year forecast period. Based on the level of capital funding with current revenues, which is projected to exceed $2 million annually, as shown in Table 6-6, it is anticipated that the Department's . RELDA K City of Virginia Beach . • • • CONSULTING Financial Feasibility Report • 0153443 Draft Financial Feasibility Report 6-11 Section 6 Financial Feasibility renewal and replacement account will meet the deposit requirements as detailed in the Master Bond Resolution, and identified as item b) above. 6.4.2. Debt Management Policies On May 14, 2002, City Council approved a set of debt management policies for the Water and Sewer Fund to assist in the guidance of short and long-term financial decisions of the utility system. These policies were adopted as part of the FY 2003 Resource Management Plan of the City. The City envisioned that these policies would evolve over time based on changing circumstances. The City's debt management policies are intended as administrative policies and are not part of any resolutions or legal or regulatory process.4 The debt management policies for the Water and Sewer Fund consist of three measurements; liquidity, debt service coverage, and pay-as-you-go funding. Each policy is described below. ■ Liquidity. The Water and Sewer Enterprise Fund will pursue the goal of retaining working capital equal to 80 to 100 percent of one year operating expenses. • Debt Service Coverage. The Water and Sewer Fund will pursue a goal of debt service coverage on its water and sewer revenue bonds at not less than 1.50 times and, on a combined basis (i.e. total debt), including water and sewer General Obligation Bonds, at no less than 1.2 times. • Pay -as you -go Funding. The Water and Sewer Fund will seek to contribute, from non -borrowed funds, on a five year rolling average basis approximately 25 percent of the annual capital program for the water and sanitary sewer system. Based on the cash flow forecast projections shown in Table 6-6, it is anticipated that the Department will achieve the stated liquidity management policy of retaining working capital equal to, or greater than, 80 to 100 percent of annual operating expenses over the five-year forecast period. Based on the debt service coverage projections shown in Table 6-7, it is anticipated that the Department will achieve the stated debt service coverage management policy of maintaining debt service coverage on its water and sewer revenue bonds at 1.50 times or greater will be met over the five-year forecast period. Based on the cash flow forecast projections shown in Table 6-6, it is anticipated that the Department will achieve the stated pay-as-you-go funding policy of contributing approximately 25 percent of non -borrowed funds to the annual capital program will be met over the five-year forecast period. 4 Debt Management Policy Information provided by the City of Virginia Beach on December I5, 2008 in an email to Red Oak Consulting. RED)A K��'"` City of Virginia Beach 1 1G CON JH Financial Feasibility Report •"°°,4. 3> °x =- _ ^« = 0153443 Draft Financial Feasibility Report 6-12 2S o. 8 N 0 7 0 LL 2. O 1 LL fe�yy 49r Tr' r gtA k g—�i6 e.- §§ 1 71e �A n N V N •,, 6 N PJ W CO CO g (� CD M 3m� o tV W 0 N H H N N N 4 AjliNR-6PElii 6 in YI tnO N N N hNC 47 P1 C17 [7 Cd g O la m H H N N N VtfgN S§ M1 N m A CD t0 N T O of C ed ' 0 pj 1 d m p N an y1 c N N w N nen ^ NNa.AnI,)6 m6' si d vat' ' m , v4 g i4 c 1 N '9 N N H N N �= IA<N^ el_ Ng N NCO Ql7 [7 f"1 CO A O N ^ a V O (O'rp e OR m 9 N oE N N N N N N ! n if— ' O NN ID 46 C)4 W �^ n O C N �i2 at m 4 N c N�p nn p N N N N iN N . 1D .YW m ct p1 8 8 r i v4 - N7 N N fG ? l7 a. .: y g 0 ci O .. 1Q m o N I 91 H O i-4 5 S N N N 6 E O$ un Q V h r N^ CO Q N uj N YI O O C f0 4 rill Ad g N 'D tP V N 7 ^ m l� C! C e <p n N I" m 49 N N H M N •- F V O (� ref y cnN� n m {� Y �n _ }Q n pp 8 {erg ppb v 6 U L2grQ n N T l? 6) m O Q O N C] g § f tl' O 8 3 N 3 e. E A.Q ;pi n 6. H^ ui?R R Fl Vi OY1 a w � cd cu m m m o 5! m a H N N H H h m a i a n M O •- t3 h .o R tai IA .-, 44 g 9 ' O r OI (7 O C 1a gaa N .. }$ as esof an Eq _ N N H W H y ; m VSs Vg z c2 &Z,' Lf 3 _ aaI Au _� E l 9 _ 8 I Z+ a Q o _ R i �, I 5t0 O a III F a 11 N1 htE oma R m 0. 4 W I W 115i xpiiQQ o b o A 1LLG3 0� C7 R us a Zi �Nt aniuiii u.5CLL �g mWa 6 e ¢3�iOiio i$lLii.�'gpy HJJII O .!or- km f ytH;QU��Nf l 11 LE. :Ecgb�la¢1 eawwu�ag I- IZo co co N 1.4'A§ V7 O R CO �mCyw n, -. .. ua fgi o N n N N of h 6 A CO tG !� N H .-t0 Cyr N) R n •- m 8 N to cc a d was. arczv ami c ma(y �0 U L.5 d R 2 N R R a O N N N 2 onP° 1l] ms N g2 N gg N O gi gi M N l id H N N O Y m 65 , o v ad O f 4 VSS 2 v cJ g ci R . , . N N 7 ci N a N EX 00a760- E eg ELL 5 a 4, c 'v ut a �r� o- 7. Conclusion 7.1. Conclusions Set forth below are the principal opinions that Red Oak has reached regarding the review of the Department's water and sewer system, and the preparation of the cash flow forecast. For a complete understanding of the assumptions upon which these opinions are based, this report should be read in its entirety. I. The experience and qualifications of the Department's management team are commensurate with their duties and responsibilities; 2. The water and sewer systems are in good working condition, based on visual inspections that were made on March 2nd and March 3rd , 2010; 3. The Department has maintained debt service coverage ratios over the prior five year period (from FY 2005 through FY 2009) at or above the debt management policy goal of the not less than 1.50 times coverage on revenue bond debt, and on a combined basis (i.e. total debt), including water and sewer General Obligation Bonds, at not less than 1.2 times. With the rate increases that were identified in this report, it is anticipated that the Department will continue to meet or exceed its debt management policies over the forecast period; 4. The Department has maintained debt service coverage ratios over the prior five year period at or above the requirements contained in the Master Bond Resolution. With adoption of the rate increases identified in this report, it is anticipated that the Department will continue to meet or exceed these requirements over the forecast period; 5. The Department has funded 25 percent or more of the annual capital program with non -borrowed funds over the prior five year period and has met its policy related to pay-as-you-go funding. With adoption of the rate increases identified in this report, it is anticipated that the Department will continue to meet or exceed its pay-as-you-go policy over the forecast period; 6. The Department has met its liquidity goal of retaining working capital equal to, or greater than, 80 to 100 percent of annual operating expenses over the prior five year period. With adoption of the rate increases identified in this report, it is anticipated that the Department will continue to meet its liquidity policy over the forecast period. REl jA K City of Virginia Beach CONS UI.TIN Financial Feasibility Report a >. �•«.. ".., 0153443 Draft Financial Feasibility Report N II Section 7 Conclusion Therefore, based on the information and estimates summarized in this report, which are reasonable in light of current information, the Series 2010 Water and Sewer Bonds are financially feasible. 7.2. Considerations and Assumptions In preparation of this report and the conclusions contained herein, Red Oak has relied on certain assumptions and information provided by the Department with respect to the conditions which may exist or events which may occur in the future. Red Oak believes the information and assumptions are reasonable, but has not independently verified information provided by the Department and others. To the extent that actual future conditions differ from those assumed herein or provided to us by others, the actual results will vary from those illustrated in the forecast (see Tables 6-6 and 6-7). Red Oak has no responsibility for updating this report for changes that occur after the date of this report. In the preparation of this report, Red Oak has made a number of principal considerations and assumptions (as provided throughout this report); some of the most notable are as follows: 1. Red Oak has made no determination as to the validity and enforceability of any contracts, agreement, existing law, rule, or regulation applicable to the Department and its operations. However, for purposes of this report, Red Oak has assumed that all such contracts, agreements, laws, rules and regulations will be fully enforceable in accordance with their terms. 2. The Department will generally continue the current policies of employing qualified and competent personnel; properly operating and maintaining the Water and Sewer System in accordance with generally accepted industry practices; and of operating the Water and Sewer System in a prudent and sound businesslike manner. 3. The proposed CIP reflects the general needs of the Water and Sewer System, and the CIP will be largely implemented as planned and reflected in this report. 4. The City will implement the rate increases and initiatives described in this report in order to achieve increases in revenue and to manage expenses as presented in the five-year financial forecast. If additional funds are required for the management, operation, and maintenance of the Water and Sewer System, the City will either seek the necessary rate increases to increase revenue or embark upon cost reduction measures, such as reducing nonessential programs to cover these unforeseen expenses. Unforeseen expenses that are not currently anticipated may result from a change in law, uninsured catastrophic event, previously unidentified capital improvements, unanticipated increases in utilities and chemicals, deferred capital improvements that must be accelerated, or currently undefined or unanticipated additional regulatory enforcement actions. REE.. ' _ City of Virginia Beach CONSULTING Financial Feasibility Report °°'• •••- 0153443 Draft Financial Feasibility Report 7-2 DRAFT 5/14/2010 CONTINUING DISCLOSURE AGREEMENT This CONTINUING DISCLOSURE AGREEMENT dated , 2010 (the "Disclosure Agreement"), is executed and delivered by the City of Virginia Beach, Virginia (the "City"), in connection with the issuance by the City of its $ Water and Sewer System Revenue Bonds, Series of 2010A, its $ Water and Sewer System Refunding Revenue Bonds, Series of 2010B (Tax -Exempt), and its $ Water and Sewer System Refunding Revenue Bonds, Series of 2010C (Tax -Exempt) (collectively, the "Bonds"). The City hereby covenants and agrees as follows: Section 1. Purpose. This Disclosure Agreement is being executed and delivered by the City for the benefit of the holders of the Bonds and in order to assist the original purchasers of the Bonds in complying with the provisions of Section (b)(5)(i) of Rule 15c2-12 (the "Rule") promulgated by the Securities and Exchange Commission (the "SEC") by providing certain annual financial information and material event notices required by the Rule (collectively, "Continuing Disclosure"). Section 2. Annual Disclosure. (a) The City shall provide annually certain financial information and operating data in accordance with the provisions of Section (b)(5)(i) of the Rule as follows: (i) audited financial statements of the City's water and sewer enterprise fund, prepared in accordance with generally accepted accounting principles; and (ii) the operating data with respect to the water and sewer system described in the City's Official Statement dated _, 2010, entitled "Ten Largest Utility Customers," "Rate History," "Water Resource Recovery Fees," "Water and Sewer Debt," "Water and Sewer Enterprise Fund Debt Service Requirements" and "System Operating Revenues, Expenses and Coverage." If the financial statements filed pursuant to Section 2(a) are not audited, the City shall file such statements as audited when available. (b) The City shall file annually with the Municipal Securities Rulemaking Board (the "MSRB") the financial information and operating data described in subsection (a) above (collectively, the "Annual Disclosure") within 180 days after the end of the City's fiscal year, commencing with the City's fiscal year ending June 30, 2010. (c) Any Annual Disclosure may be included by specific reference to other documents previously provided to the MSRB or filed with the SEC; provided, however, that any final official statement incorporated by reference must be available from the MSRB. (d) The City shall file with the MSRB in a timely manner notice specifying any failure of the City to provide the Annual Disclosure by the date specified. Section 3. Event Disclosure. The City shall file with the MSRB in a timely manner notice of the occurrence of any of the following events with respect to the Bonds, if material: (a) principal and interest payment delinquencies; (b) non-payment related defaults; (c) unscheduled draws on debt service reserves reflecting financial difficulties; (d) unscheduled draws on any credit enhancement reflecting financial difficulties; (e) substitution of credit or liquidity providers, or their failure to perform; (f) adverse tax opinions or events affecting the tax-exempt status of the Bonds; (g) modifications to rights of Bondholders; (h) bond calls; (i) defeasance of all or any portion of the Bonds; (j) release, substitution, or sale of property securing repayment of the Bonds; and (k) rating changes. Section 4. Termination. The obligations of the City hereunder will terminate upon the redemption, defeasance (within the meaning of the Rule) or payment in full of all the Bonds. Section 5. Amendment. The City may modify its obligations hereunder without the consent of Bondholders, provided that this Disclosure Agreement as so modified complies with the Rule as it exists at the time of modification. The City shall within a reasonable time thereafter file with the MSRB a description of such modification(s). Section 6. Defaults. (a) If the City fails to comply with any covenant or obligation regarding Continuing Disclosure specified in this Disclosure Agreement, any holder (within the meaning of the Rule) or beneficial holder of Bonds then outstanding may, by notice to the City, proceed to protect and enforce its rights and the rights of the holders by an action for specific performance of the City's covenant to provide the Continuing Disclosure. (b) Notwithstanding anything herein to the contrary, any failure of the City to comply with any obligation regarding Continuing Disclosure specified in this Disclosure Agreement (i) shall not be deemed to constitute an event of default under the Bonds or the resolution providing for the issuance of the Bonds and (ii) shall not give rise to any right or remedy other than that described in Section 6(a) above. Section 7. Filing Method. Any filing required hereunder shall be made by transmitting such disclosure, notice or other information in electronic format to the MSRB through the MSRB's Electronic Municipal Market Access (EMMA) system pursuant to procedures promulgated by the MSRB. Section 8. Additional Disclosure. The City may from time to time disclose certain information and data in addition to the Continuing Disclosure. Notwithstanding anything herein 2 I to the contrary, the City shall not incur any obligation to continue to provide, or to update, such additional information or data. Section 9. Counterparts. This Disclosure Agreement may be executed in several counterparts each of which shall be an original and all of which shall constitute but one and the same instrument. Section 10. Governing Law. This Disclosure Agreement shall be construed and enforced in accordance with the laws of the Commonwealth of Virginia. CITY OF VIRGINIA BEACH, VIRGINIA Mayor, City of Virginia Beach, Virginia City Manager, City of Virginia Beach, Virginia 3 OFFICIAL NOTICE OF SALE CITY OF VIRGINIA BEACH, VIRGINIA $65,000,000 WATER AND SEWER SYSTEM REVENUE BONDS, SERIES 2010A Electronic bids only will be received by the City of Virginia Beach, Virginia (the "City"), in accordance with this Official Notice of Sale until 11:30 A.M., Local Time, on Wednesday, June 16, 2010 (the "Date of Sale"). In the case of a malfunction in submitting an electronic bid, facsimile bids will be allowed, as more fully described below. Immediately thereafter, the bids will be publicly announced, and the City Manager will act upon the bids by 2:30 p.m., Local Time. Bidders must designate, through the submission of their bid, all of the Series 2010C Bonds as either tax- exempt bonds (the "Tax -Exempt Bonds'), federally taxable Build America Bonds (the "Taxable BAB Bonds"), or a combination thereof, as further described herein. See "Bidding Rules; Award of Bonds." Bid Submission Solely as an accommodation to bidders, electronic bids via BIDCOMP/PARITY (the "Electronic Bidding System") will be accepted in accordance with this Official Notice of Sale. The City is using BIDCOMP/PARITY as a communication mechanism to conduct the electronic bidding for the sale of $65,000,000 Water And Sewer System Revenue Bonds, Series 2010A (the "Bonds"), as described herein. To the extent any instructions or directions set forth in BIDCOMP/PARITY conflict with this Official Notice of Sale, the terms of this Official Notice of Sale shall control. Each bidder submitting an electronic bid agrees (i) that it is solely responsible for all arrangements with BIDCOMP/PARITY, (ii) that BIDCOMP/PARITY is not acting as the agent of the City, and (iii) that the City is not responsible for ensuring or verifying bidder compliance with any of the procedures of BIDCOMP/PARITY. The City assumes no responsibility for, and each bidder expressly assumes the risks of and responsibility for, any incomplete, inaccurate or untimely bid submitted by such bidder through BIDCOMP/PARITY. Each bidder shall be solely responsible for making necessary arrangements to access the Electronic Bidding System for purposes of submitting its bid in a timely manner and in compliance with the requirements of this Official Notice of Sale. Neither the City nor the Electronic Bidding System shall have any duty or obligation to provide or assure such access to any bidder, and neither the City nor BIDCOMP/PARITY shall be responsible for proper operation of, or have any liability for, any delays or interruptions of, or any damages caused by, BIDCOMP/PARITY. For further information about BIDCOMP/PARITY, potential bidders may contact BIDCOMP/PARITY at 1359 Broadway, 2" Floor, New York, New York 10018, telephone (212) 849-5021. The Bonds may be issued as one tax-exempt series, one taxable series, or a combination thereof, as further described herein. In the event of a malfunction of the Electronic Bidding System, facsimile transmission bids will be accepted up to 11:30 A.M., Local Time, on the Date of Sale. Bidders choosing to submit bids in the case of a malfunction by facsimile transmission shall use the following telecopier numbers for such transmission: (757) 385- 4302 or (757) 385-8894 (Attention: Patricia A. Phillips). Transmissions received after the deadline shall be rejected. It is the responsibility of the bidder to ensure that the bid is legible, that the bid is received not later than 11:30 A.M., Local Time, and that the bid is sent to one of the telecopier numbers set forth above. Illegible transmissions shall be rejected. The City's financial advisor, Government Finance Associates, Inc. ("Financial Advisor") will, on behalf of the City, verify receipt of each bid submitted through facsimile transmission by contacting each bidder by telephone once the bid has been received. The Financial Advisor will in no instance correct, alter or in any way change bids submitted through facsimile transmission. Neither the City nor its Financial Advisor will be responsible for bids submitted by facsimile transmission not received in accordance with the provisions of this Official Notice of Sale. Bidders electing to submit bids via facsimile transmission will bear full and complete responsibility for the transmission of such bid. Each bid must be unconditional. Principal Redemption The Bonds will be general obligation bonds of the City, dated the date of delivery (the "Dated Date"), anticipated for Tuesday, June 29, 2010, and will mature serially or be subject to mandatory sinking fund redemptions on October 1 in the years and amounts shown below. Preliminary Preliminary Due October 1 Amount Due October 1 Amount 2011 $1,645,000 2024 $2,495,000 2012 1,680,000 2025 2,625,000 2013 1,715,000 2026 2,755,000 2014 1,750,000 2027 2,900,000 2015 1,785,000 2028 3,045,000 2016 1,820,000 2029 3,205,000 2017 1,865,000 2030 3,370,000 2018 1,925,000 2031 3,540,000 2019 1,980,000 2032 3,720,000 2020 2,050,000 2033 3,915,000 2021 2,145,000 2034 4,115,000 2022 2,255,000 2035 4,325,000 2023 2,375,000 Serial Bonds, Term Bonds and Mandatory Sinking Fund Redemptions Bidders may provide in the bid form for all of the Bonds to be issued as serial Bonds or may designate consecutive annual principal amounts of the Bonds to be combined into not more than two Term Bonds. In the event that a bidder chooses to specify a Term Bond, each such Term Bond shall be subject to mandatory sinking fund redemption commencing on October 1 of the first year which has been combined to form such Term Bond and continuing on October 1 in each year thereafter until the stated maturity of such Term Bond. The amount redeemed in any year shall be equal to the principal amount for such year set forth in the amortization schedule above. Bonds to be redeemed in any year by mandatory sinking fund redemption shall be redeemed at par and shall be selected by lot from among the maturities of the Term Bond being redeemed. Description of the Bonds; Book -Entry Only System The Bonds will be issued by means of a book -entry system with no distribution of physical Bond certificates made to the public. One Bond certificate for each maturity will be issued to The Depository Trust Company, New York, New York ("DTC"), or its nominee, and immobilized in its custody. The book -entry system will evidence beneficial ownership of the Bonds in principal amounts of $5,000 or multiples thereof, with transfers of beneficial ownership effected on the records of DTC and its participants pursuant to rules and procedures established by DTC and its participants. Bond certificates registered in the name of Cede & Co. will be deposited with DTC. Interest on the Bonds will be paid semiannually on October 1 and April 1, beginning October 1, 2010, and principal on the Bonds will be paid annually on October 1, beginning October 1, 2011, to DTC or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to beneficial owners by participants of DTC will be the responsibility of such participants and other nominees of beneficial owners. The City will not be 2 11 i responsible or liable for maintaining, supervising or reviewing the records maintained by DTC, its participants or persons acting through such participants. DTC may discontinue providing its services as securities depository with respect to the Bonds at any time by giving reasonable notice to the City. Under such circumstances, in the event that a successor securities depository is not obtained, Bond certificates are required to be prepared, executed and delivered. The City may decide to discontinue use of the system of book -entry transfers through DTC (or a successor securities depository). In that case, either a successor depository will be selected by the City or Bond certificates will be prepared, executed and delivered. Optional Redemption Optional Redemption for Bonds Sold and Issued as Tax Exempt Bonds Tax -Exempt Bonds that mature on or before October 1, 2020 are not subject to optional redemption prior to their stated maturities. Tax -Exempt Bonds that mature on and after October 1, 2021 will be subject to redemption beginning October 1, 2020, in whole or in part at any time, at the option of the City, upon payment of the par amount of the Tax -Exempt Bonds so redeemed plus interest accrued and unpaid to the redemption date. Extraordinary Optional Redemption for Taxable BAB Bonds Before October 1, 2020, any Bonds issued as Taxable BAB Bonds are subject to redemption on any date prior to their maturity at the option of the City, in whole or in part upon the occurrence of an Extraordinary Event, as defined below, at a redemption price equal to the greater of: (1) 100% of the principal amount of the Bonds to be redeemed; or (2) the sum of the present value of the remaining scheduled payments of principal and interest to the maturity date of the Bonds to be redeemed, not including any portion of those payments of interest accrued and unpaid as of the date on which the Bonds are to be redeemed, discounted to the date on which the Bonds are to be redeemed on a semi-annual basis, assuming a 360 -day year consisting of twelve 30 -day months, at the Treasury Rate, plus 100 basis points; plus, in each case, accrued interest on the Bonds to be redeemed to the redemption date. An "Extraordinary Event" will have occurred if the City determines that a material adverse change has occurred to Section 54AA or 6431 of the Code (as such Sections were added by Section 1531 of the Recovery Act, pertaining to "Build America Bonds") or there is any guidance published by the Internal Revenue Service or the United States Department of the Treasury with respect to such Sections or any other determination by the Internal Revenue Service or the United States Department of the Treasury, which determination is not the result of any act or omission by the City to satisfy the requirements to qualify to receive the 35% cash subsidy payment from the United States Department of the Treasury, pursuant to which the City's 35% cash subsidy payment from the United States Department of the Treasury is reduced or eliminated. "Treasury Rate" means, with respect to any redemption date for a particular Taxable BAB Bond, the yield to maturity as of such redemption date of United States securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519)) that has become publicly available at least two business days prior to the redemption date (excluding inflation indexed securities or, if such Statistical Release is no longer published, any publicly available source of similar market data) most nearly equal to the period from the redemption date to the maturity date of the Taxable BAB Bond to be redeemed; provided, that if the period from the redemption date to the maturity date is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used. 3 Optional Redemption for Bonds Sold and Issued As Taxable BAB Bonds Taxable BAB Bonds maturing on and prior to October 1, 2020 will not be subject to redemption prior to maturity except pursuant to the extraordinary optional redemption provisions set forth above. Taxable BAB Bonds maturing after October 1, 2020 will be subject to redemption prior to maturity, at the option of the City, on or after October 1, 2020, either in whole or in part on a pro rata basis as described below at any time, at a redemption price of 100% of the principal amount of the Taxable BAB Bonds to be redeemed, plus accrued interest to the date set for redemption. Selection of Bonds to be Redeemed in Partial Redemption The following provisions shall apply to Bonds sold and issued as Tax -Exempt Bonds: If less than all of the Bonds are called for optional redemption, the Bonds to be redeemed shall be selected by the City's Director of Finance in such manner as may be determined to be in the best interest of the City. If less than all of the Bonds of a particular maturity are called for redemption, DTC or any successor securities depository will select the Bonds to be redeemed pursuant to its rules and procedures or, if the book -entry system is discontinued, the Bonds to be redeemed will be selected by the City Treasurer, who has been appointed registrar (the "Registrar"), by lot in such manner as the Registrar in its discretion may determine. In either case, each portion of the $5,000 principal amount is counted as one Bond for such purpose. The following provisions shall apply to Bonds sold and issued as Taxable BAB Bonds: If less than all of the Taxable BAB Bonds of a particular maturity are called for redemption, the particular Taxable BAB Bonds to be redeemed will be selected on a pro -rata basis. With respect to such Taxable BAB Bonds sold, "pro rata" is determined, in connection with any mandatory sinking fund redemption or any optional redemption in part, by multiplying the principal amount of such maturity to be redeemed on the application redemption date by a fraction, the numerator of which is equal to the principal amount of the Taxable BAB Bond of such maturity owned by the registered owner, and the denominator of which is equal to the total amount of the Taxable BAB Bonds of such maturity then outstanding immediately prior to such redemption date, and then rounding the product down to the next lower integral multiple of $5,000; provided that the portion of any Taxable BAB Bonds to be redeemed are required to be in authorized denominations and all Taxable Bonds of a maturity to remain outstanding following any redemption are required to be in authorized denominations. Notwithstanding the foregoing, if the Taxable BAB Bonds are in book -entry form a the time of such redemption, the City will instruct DTC to instruct the DTC participants to select the specific Taxable BAB Bonds for redemption by lot within maturities among Beneficial Owners, and the City shall not have any responsibility to ensure that DTC or the DTC participants properly select such Taxable BAB Bonds for redemption. Notice of Redemption The City will cause notice of the call for redemption identifying the Bonds or portions thereof to be redeemed to be sent by facsimile transmission, registered or certified mail or overnight express delivery, not less than 30 nor more than 60 days prior to the redemption date, to the registered owner thereof. The City shall not be responsible for mailing notice of redemption to anyone other than DTC or another qualified securities depository or its nominee unless no qualified securities depository is the registered owner of the Bonds. If no qualified securities depository is the registered owner of the Bonds, notice of redemption shall be mailed to the registered owners of the Bonds. If a portion of a Bond is called for redemption, a new Bond in principal amount equal to the unredeemed portion shall be issued to the registered owner upon the surrender thereof Security 4 The Bonds are limited obligations of the City, payable solely from Pledged Revenues of the System, subject to the prior application thereof to the payment of Operating Expenses, and reserves therefore, as provided in the Resolution, as further described in the City's Preliminary Official Statement, dated , 2010. Neither the faith and credit of the Commonwealth of Virginia nor the faith and credit of any county, city, town or other subdivision of the Commonwealth of Virginia, including the City, are pledged to the payment of principal of or interest on the Bonds. In the Resolution, the City covenants to fix, charge, collect and revise its fees, rates and other charges for the use of and for the services furnished by the System in each Fiscal Year so as to produce revenues sufficient to pay the cost of operation and maintenance, the cost of necessary replacements and improvements and debt service on the Bonds and on any other indebtedness of the City secured by such revenues, and to provide certain reserves therefore. Use of Bond Proceeds As described in more detail in the City's Preliminary Official Statement, dated , 2010, the Bonds are being issued to provide funds for various water and sewer construction projects in the City and for certain costs of issuance related to the Bonds. Bidding Rules; Award of Bonds A bidder may choose to submit tax-exempt interest rates or taxable Build American Bonds (BAB) interest rates on a maturity by maturity basis. The Bonds may be issued as one tax-exempt series, one taxable BAB series, or a combination which would include a series of Tax -Exempt Bonds and a series of Taxable BAB Bonds. In the event the winning bid is a combination of Tax -Exempt Bonds and Taxable BAB Bonds, the Tax -Exempt Bonds will be identified as Series 2010A-1 (Tax -Exempt) and the Taxable BAB Bonds will be identified as Series 2010A-2 (Taxable — Build America Bonds). Bidders may only bid to purchase all of the Bonds. No bid for less than 100% of par (computed on the basis of a 360 -day year and twelve 30 -day months) shall be considered. Bidders are invited to name the rate or rates of interest per annum which the Bonds are to bear in multiples of one -twentieth (1/20th) or one-eighth (1/8th) of one percent. All Bonds maturing on the same date must bear interest at the same rate. Any number of rates may be named provided that (a) the highest rate of interest may not exceed the lowest rate of interest by more than 5 percentage points, and (b) the highest rate of interest stated for any maturity may not exceed 6.5% per annum. The rate limitation shall apply to both Tax -Exempt Bonds and to Taxable BAB Bonds; for purposes of the award, the interest rates on any Taxable BAB Bonds shall be reduced by 35% (reflecting the tax credit that the City will elect to receive as a result of the Bonds being qualified Build America Bonds). In no event shall the true interest cost for the issue received by the City exceed 4.5%. Bidders must provide to the City immediately upon award the reoffering price for such Bonds; for Taxable BAB Bonds, such reoffering price for each maturity cannot exceed the par amount of the individual maturity by more than 0.25 percent multiplied by the number of whole years to the maturity date of such Bonds. The City reserves the right to reject any or all bids (regardless of the interest rate bid), to reject any bid not complying with this Official Notice of Sale and, so far as permitted by law, to waive any irregularity or informality with respect to any bid or the bidding process. Unless all bids are rejected, the Bonds will be awarded to the bidder complying with the terms of this Official Notice of Sale and submitting a bid which provides the lowest "true" interest cost to the City. True interest cost shall be determined for each bid by doubling the semiannual interest rate, compounded semiannually, necessary to discount the debt service payments from the payment dates to the Dated Date and to the price bid. If more than one bid offers the same lowest true interest cost, the successful bid will be selected by the City Manager by lot. The City reserves the right to reject any or all bids and to waive any irregularity or informality with respect to any bid. Bids for the Bonds shall not be conditioned upon obtaining insurance or any other credit enhancement. If a bidder proposes to obtain a policy of municipal bond insurance or any other credit enhancement, any such purchase of insurance or commitment therefor shall be at the sole option and expense of the bidder, and the bidder must pay any increased costs of issuance of the Bonds as a result of such insurance or commitment. Any failure by the bidder 5 to obtain such a policy of insurance shall not in any way relieve such bidder of its contractual obligations arising from the acceptance of its bid for the purchase of the Bonds. As promptly as reasonably possible after the bids are received, the City will notify the bidder to whom the Bonds will be awarded, if and when such award is made. Such bidder, upon such notice, shall advise the City of the initial reoffering prices or yields to the public of each maturity of the Bonds (the "Initial Reoffering Prices or Yields") and details regarding the anticipated use of a municipal bond insurance policy, if any, in connection with the Bonds. The successful bidder must reasonably expect to sell to the public 10% or more in par amount of the Bonds from each maturity at the Initial Reoffering Prices or Yields. All bids will remain firm for a period of no less than three hours after the time specified for the opening of bids. An award of the Bonds, if made, will be made by the City Manager within such three hour period or, with the express consent of the bidders, such longer time period as deemed necessary. Good Faith Deposit The successful bidder for the Bonds is required to submit a Good Faith Deposit in the amount of $650,000 payable to the order of the City of Virginia Beach in the form of a wire transfer in federal funds, as instructed by the City's Financial Advisor. The successful bidder must submit the Good Faith Deposit not later than 11:30 A.M., Local Time, on the next business day following the award. The successful bidder shall provide the federal funds reference number upon request of the City. If the successful bidder fails to comply with the terms of its bid, the Good Faith Deposit shall be retained by the City as full liquidated damages; otherwise, the amount thereof will be applied to the purchase price of the Bonds at the time of delivery. No interest on the Good Faith Deposit will accrue to the successful bidder. Delivery of the Bonds The Bonds will be delivered at the expense of the City in New York, New York, through the facilities of DTC on or about June 29, 2010. Concurrently with the delivery of the Bonds, the City will furnish to the successful bidder without cost (a) a certificate dated the date of delivery of the Bonds, signed by the appropriate City officials and stating that no litigation of any kind is then pending or, to the best of their information, knowledge and belief, threatened against the City to restrain or enjoin the issuance or delivery of the Bonds or the levy or collection of ad valorem taxes and (b) certificates dated the date of delivery of the Bonds, stating that the descriptions and statements in the Official Statement (except in the sections entitled "Book -Entry System" and "Tax Exemption" and in the columns "Price/ Yield" and "CUSIP No." on the inside cover), on the date of the Official Statement and on the date of delivery of the Bonds, were and are true and correct in all material respects, did not and do not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make such descriptions and statements, in light of the circumstances under which they were made, not misleading. Such certificates will also state, however, that such City officials did not independently verify the information indicated in the Official Statement as having been obtained or derived from sources other than the City and its officers but they have no reason to believe that such information is not accurate. Certificate of Winning Bidder The successful bidder must, by facsimile transmission or overnight delivery received by the City within 24 hours after receipt of the bids for the Bonds, furnish the following information to the City to complete the Official Statement in final form, as described below: A. The offering prices for the Bonds (expressed as the price or yield per maturity, exclusive of any accrued interest). 6 B. Selling compensation (aggregate total anticipated compensation to the underwriters expressed in dollars, based on the expectation that all Bonds are sold at the prices or yields described in Subpart A above). C. The identity of the underwriters if the successful bidder is a part of a group or syndicate. D. Any other material information necessary to complete the Official Statement in final form but not known to the City. Prior to the delivery of the Bonds, the successful bidder shall furnish to the City a certificate in form acceptable to bond counsel, to the effect that the successful bidder has made a bona fide public offering of the Bonds at the initial public offering prices set forth in such certificate, that the successful bidder has complied with Rule G- 37 of the Municipal Securities Rulemaking Board (the "MSRB") with respect to the City and that a substantial amount of the Bonds of each maturity were sold to the public (excluding bond houses, brokers and other intermediaries) at such initial public offering prices. Such certificate shall state that (1) it is made on the best knowledge, information and belief of the successful bidder and (2) 10% or more in par amount of the Bonds of each maturity was reasonable expected to be sold on the Date of Sale to the public at the initial public offering price (such amount being sufficient to establish the sale of a substantial amount of the Bonds). CUSIP Numbers It is anticipated that CUSIP identification numbers will be printed on the Bonds, but neither the failure to print such numbers on any Bond nor any error with respect thereto shall constitute cause for failure or refusal by the successful bidder thereof to accept delivery of and pay for the Bonds in accordance with the terms of its bid. The City will assume responsibility for the expense of the initial printing of CUSIP numbers; provided, however, that the City assumes no responsibility for any CUSIP Service Bureau or other charges that may be imposed for the assignment of such numbers. All expenses in connection with the assignment of CUSIP numbers shall be paid by the successful bidder. It shall be the obligation of the successful bidder to furnish to DTC an underwriter questionnaire and to the City the CUSIP numbers for the Bonds within two business days following the date of award. Official Statement The City will furnish the successful bidder at the expense of the City up to 500 copies of the final Official Statement by the earlier of the closing date and seven business days from the date of the award of the Bonds, as specified in Rule 15c2-12 (the "Rule") of the Securities and Exchange Commission (the "SEC") and the rules of the MSRB provided that minor delays in furnishing such final Official Statement will not be a basis for failure to pay for and accept delivery of the Bonds. Additional copies will be made available at the successful bidder's request and expense. The City assumes no responsibility or obligation for the distribution or delivery of the Official Statement to anyone other than the successful bidder. The successful bidder agrees to provide one copy of the Official Statement to the Municipal Securities Rulemaking Board using its Electronic Municipal Market Access System upon receipt of the Official Statement from the City and two copies of the Official Statement (with any required forms) to the MSRB or its designee no later than ten business days following the Date of Sale. The successful bidder shall notify the City as soon as practicable of (1) the date which is the end of the underwriting period (such "underwriting period" is described in the Rule), and (2) the date of filing the Official Statement with the MSRB or its designee. If the Bonds are awarded to a syndicate, the City will designate the senior managing underwriter of the syndicate as its agent for purposes of distributing copies of the Official Statement to each participating underwriter. Any underwriter executing and delivering a bid form with respect to the Bonds agrees thereby that if its bid is accepted it shall accept such designation and shall enter into a contractual relationship with all participating underwriters for the purposes of assuring the receipt and distribution by each such participating underwriter of the Official Statement, unless another firm is so designated by the syndicate in writing and approved by the City. 7 N II Legal Opinion The approving opinion of Hunton & Williams LLP, Richmond, Virginia, Bond Counsel with respect to the Bonds will be furnished to the successful bidder at the expense of the City and will state that the Bonds constitute limited obligations of the City, payable solely from Pledged Revenues, as defined in the Preliminary Official Statement, dated , 2010, subject to the prior application thereof to the payment of Operating Expenses, and reserves established under the Resolution on a parity with other water and sewer system revenue bonds of the City. Federal and State Securities Laws No action has been taken to qualify the Bonds under the federal and Commonwealth securities laws. Tax Matters The Preliminary Official Statement relating to the Bonds contains a discussion of the tax status of interest received on the Bonds, whether issued as Tax -Exempt Bonds or Taxable BAB Bonds. Continuing Disclosure To assist the successful bidder in complying with the Rule, the City will agree, pursuant to the Continuing Disclosure Agreement, to provide certain annual financial information and operating data and notices of the occurrence of certain events, if material. A description of this undertaking is set forth in the Preliminary Official Statement for the Bonds and will also be set forth in the final Official Statement for the Bonds (See Appendix of the Preliminary Official Statement dated , 2010). Change of Date and Time for Receipt of Bids The City expects to take bids on the Bonds on June 16, 2010. However, the City reserves the right to postpone the date and time established for the receipt of bids. Any such postponement will be announced by the Thomson Municipal Newswire ("TM3"), or any other such service. If the receipt of bids is postponed, any altemative date for receipt of bids will be announced via TM3, or any other such service. Any bidder must submit a bid for the purchase of the Bonds on such alternative sale date in conformity with the provisions of this Official Notice of Sale, except for any changes announced via TM3, or any other such service used by the City for this purpose, as described therein. Additional Information For further information relating to the Bonds and the City, reference is made to the City's Preliminary Official Statement. The City has deemed the Preliminary Official Statement to be final as of its date within the meaning of the Rule, except for the omission of certain pricing and other information permitted to be omitted pursuant to the Rule. The Official Bid Form and the Preliminary Official Statement may be obtained from the City's Financial Advisor, Government Finance Associates, Inc. (telephone 212-521-4090). Dated: , 2010 CITY OF VIRGINIA BEACH, VIRGINIA By: James K. Spore City Manager 8 OFFICIAL NOTICE OF SALE CITY OF VIRGINIA BEACH, VIRGINIA $8,115,000* WATER AND SEWER SYSTEM REFUNDING REVENUE BONDS, SERIES 2010E Electronic bids only will be received by the City of Virginia Beach, Virginia (the "City"), in accordance with this Official Notice of Sale until 11:30 a.m., Local Time, on Thursday, June 17, 2010 (the "Date of Sale"). In the case of a malfunction in submitting an electronic bid, facsimile bids will be allowed, as more fully described below. Immediately thereafter, the bids will be publicly announced, and the City Manager will act upon the bids by 2:30 p.m., Local Time. Bid Submission Solely as an accommodation to bidders, electronic bids via BIDCOMP/PARITY (the "Electronic Bidding System") will be accepted in accordance with this Official Notice of Sale. The City is using BIDCOMP/PARITY as a communication mechanism to conduct the electronic bidding for the sale of $8,115,000* Water And Sewer System Revenue And Refunding Bonds, Series 2010B (the "Bonds"), as described herein. To the extent any instructions or directions set forth in BIDCOMP/PARITY conflict with this Official Notice of Sale, the terms of this Official Notice of Sale shall control. Each bidder submitting an electronic bid agrees (i) that it is solely responsible for all arrangements with BIDCOMP/PARITY, (ii) that BIDCOMP/PARITY is not acting as the agent of the City, and (iii) that the City is not responsible for ensuring or verifying bidder compliance with any of the procedures of BIDCOMP/PARITY. The City assumes no responsibility for, and each bidder expressly assumes the risks of and responsibility for, any incomplete, inaccurate or untimely bid submitted by such bidder through BIDCOMP/PARITY. Each bidder shall be solely responsible for making necessary arrangements to access the Electronic Bidding System for purposes of submitting its bid in a timely manner and in compliance with the requirements of this Official Notice of Sale. Neither the City nor the Electronic Bidding System shall have any duty or obligation to provide or assure such access to any bidder, and neither the City nor BIDCOMP/PARITY shall be responsible for proper operation of, or have any liability for, any delays or interruptions of, or any damages caused by, BIDCOMP/PARITY. For further information about BIDCOMP/PARITY, potential bidders may contact BIDCOMP/PARITY at 1359 Broadway, 2nd Floor, New York, New York 10018, telephone (212) 849-5021. In the event of a malfunction of the Electronic Bidding System, facsimile transmission bids will be accepted up to 11:30 a.m., Local Time, on the Date of Sale. Bidders choosing to submit bids in the case of a malfunction by facsimile transmission shall use the following telecopier numbers for such transmission: (757) 385- 4302 or (757) 385-8894 (Attention: Patricia A. Phillips). Transmissions received after the deadline shall be rejected. It is the responsibility of the bidder to ensure that the bid is legible, that the bid is received not later than 11:30 a.m., Local Time, and that the bid is sent to one of the telecopier numbers set forth above. Illegible transmissions shall be rejected. The City's financial advisor, Government Finance Associates, Inc. ("Financial Advisor"), will, on behalf of the City, verify receipt of each bid submitted through facsimile transmission by contacting each bidder by telephone once the bid has been received. The Financial Advisor will in no instance correct, alter or in any way change bids submitted through facsimile transmission. Neither the City nor the Financial Advisor will be responsible for bids submitted by facsimile transmission not received in accordance with the provisions of this Official Notice of Sale. Bidders electing to submit bids via facsimile transmission will bear full and complete responsibility for the transmission of such bid. * Preliminary; subject to change. II Each bid must be unconditional. Principal Redemption The Bonds will be public facility refunding revenue bonds of the City, dated the date of delivery (the "Dated Date"), and will mature serially or be subject to mandatory sinking fund redemptions on October 1 in the years and amounts shown below. Preliminary Preliminary Due October 1 Amount* Due October 1 Amount* 2010 $80,000 2016 $ 85,000 2011 75,000 2017 885,000 2012 80,000 2018 1,290,000 2013 80,000 2019 1,740,000 2014 80,000 2020 1,790,000 2015 85,000 2021 1,845,000 *Preliminary; subject to change. Serial Bonds, Term Bonds and Mandatory Sinking Fund Redemptions Bidders may provide in the bid form for all of the Bonds to be issued as serial Bonds or may designate consecutive annual principal amounts of the Bonds to be combined into not more than two Term Bonds. In the event that a bidder chooses to specify a Term Bond, each such Term Bond shall be subject to mandatory sinking fund redemption commencing on October 1 of the first year which has been combined to form such Term Bond and continuing on October 1 in each year thereafter until the stated maturity of such Term Bond. The amount redeemed in any year shall be equal to the principal amount for such year set forth in the amortization schedule above. Bonds to be redeemed in any year by mandatory sinking fund redemption shall be redeemed at par and shall be selected by lot from among the maturities of the Term Bond being redeemed. Description of the Bonds; Book -Entry Only System The Bonds will be issued by means of a book -entry system with no distribution of physical Bond certificates made to the public. One Bond certificate for each maturity will be issued to The Depository Trust Company, New York, New York ("DTC"), or its nominee, and immobilized in its custody. The book -entry system will evidence beneficial ownership of the Bonds in principal amounts of $5,000 or multiples thereof, with transfers of beneficial ownership effected on the records of DTC and its participants pursuant to rules and procedures established by DTC and its participants. Bond certificates registered in the name of Cede & Co. will be deposited with DTC. Interest on the Bonds will be paid semiannually on October 1 and April 1, beginning October 1, 2010, and principal on the Bonds will be paid annually on October 1, beginning October 1, 2010, to DTC or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to beneficial owners by participants of DTC will be the responsibility of such participants and other nominees of beneficial owners. The City will not be responsible or liable for maintaining, supervising or reviewing the records maintained by DTC, its participants or persons acting through such participants. 2 I DTC may discontinue providing its services as securities depository with respect to the Bonds at any time by giving reasonable notice to the City. Under such circumstances, in the event that a successor securities depository is not obtained, Bond certificates are required to be prepared, executed and delivered. The City may decide to discontinue use of the system of book -entry transfers through DTC (or a successor securities depository). In that case, either a successor depository will be selected by the City or Bond certificates will be prepared, executed and delivered. Optional Redemption The Bonds that mature on or before October 1, 2020 are not subject to optional redemption prior to their stated maturities. The Bonds that mature on or after October 1, 2021 will be subject to redemption beginning October 1, 2020, in whole or in part at any time, at the option and direction of the City, upon payment of the par amount of principal so redeemed plus interest accrued and unpaid to the redemption date. Security The Bonds are limited obligations of the City, payable solely from Pledged Revenues of the System, subject to the prior application thereof to the payment of Operating Expenses, and reserves therefore, as provided in the Resolution, as further described in the City's Preliminary Official Statement, dated , 2010. Neither the faith and credit of the Commonwealth of Virginia nor the faith and credit of any county, city, town or other subdivision of the Commonwealth of Virginia, including the City, are pledged to the payment of principal of or interest on the Bonds. In the Resolution, the City covenants to fix, charge, collect and revise its fees, rates and other charges for the use of and for the services furnished by the System in each Fiscal Year so as to produce revenues sufficient to pay the cost of operation and maintenance, the cost of necessary replacements and improvements and debt service on the Bonds and on any other indebtedness of the City secured by such revenues, and to provide certain reserves therefore. Use of Bond Proceeds As described in more detail in the City's Preliminary Official Statement, dated , 2010, the Bonds are being issued to pay for the refunding of a portion of the City's Water And Sewer Revenue And Refunding Bonds, Series of 2005, and to pay certain costs of issuance related to the Bonds. Bidding Rules; Award of Bonds Bidders may only bid to purchase all of the Bonds. Bidders are invited to name the rate or rates of interest per annum which the Bonds are to bear in multiples of one -twentieth (1/20th) or one-eighth (1/8th) of one percent. All Bonds maturing on the same date must bear interest at the same rate. Any number of rates may be named provided that (a) the highest rate of interest may not exceed the lowest rate of interest by more than 3 percentage points, and (b) the highest rate of interest stated for any maturity may not exceed 5.0% per annum, but in no event shall the "true" interest cost exceed 4.5%. No bid for less than 100% of par shall be considered. The City reserves the right to reject any or all bids (regardless of the interest rate bid), bid not complying with this Official Notice of Sale and, so far as permitted by law, to waive any irregularity or informality with respect to any bid or the bidding process. As promptly as reasonably possible after the bids are received, the City will notify the bidder to whom the Bonds will be awarded, if and when such award is made. Such bidder, upon such notice, shall advise the City of the initial reoffering prices or yields to the public of each maturity of the Bonds (the "Initial Reoffering Prices or Yields") and details regarding the anticipated use of a municipal bond insurance policy, if any, in connection with the Bonds. The successful bidder must reasonably expect to sell to the public 10% or more in par amount of the Bonds from each maturity at the Initial Reoffering Prices or Yields. All bids will remain firm for a period of no less 3 than three hours after the time specified for the opening of bids. An award of the Bonds, if made, will be made by the City Manager within such three hour period or, with the express consent of the bidders, such longer time period as deemed necessary. Unless all bids are rejected, the Bonds will be awarded to the bidder complying with the terms of this Official Notice of Sale and submitting a bid which provides the lowest "true" interest cost to the City. True interest cost shall be determined for each bid by doubling the semiannual interest rate, compounded semiannually, necessary to discount the debt service payments from the payment dates to the Dated Date, which is the date of settlement, and to the bid price. If more than one bid offers the same lowest true interest cost, the successful bid will be selected by the City Manager by lot. The City reserves the right to reject any or all bids and to waive any irregularity or informality with respect to any bid. Bids for the Bonds shall not be conditioned upon obtaining insurance or any other credit enhancement. If a bidder proposes to obtain a policy of municipal bond insurance or any other credit enhancement, any such purchase of insurance or commitment therefor shall be at the sole option and expense of the bidder, and the bidder must pay any increased costs of issuance of the Bonds as a result of such insurance or commitment. Any failure by the bidder to obtain such a policy of insurance shall not in any way relieve such bidder of its contractual obligations arising from the acceptance of its bid for the purchase of the Bonds. Adjustment of Principal Amount Prior to the Opening of Bids The preliminary aggregate principal amount of the Bonds and the preliminary annual principal maturities of the Bonds, each as set forth in this Official Notice of Sale, may be revised by the City before the receipt of bids. Any such revisions made prior to receipt of the bids will be published via TM3 Newswire (or some other municipal newswire recognized by the municipal securities industry) and via BIDCOMP/PARITY no later than 9:00 a.m. (Local Time) on the Date of Sale. In the event that no such revisions are made, the preliminary amounts will constitute the amounts that shall be used for the bid and award of the Bonds, subject to further adjustment, as described below. Adjustment of Principal Amount After Award The City reserves the right, after the award of the Bonds to the successful bidder, to increase or decrease by up to ten percent (10%) the principal amount of the Bonds being offered hereby. The City may choose not to exercise such right to increase or decrease the principal amount of the Bonds being offered. Should the City decide to exercise this right, any such increase or decrease in the principal amount of particular maturities of the Bonds will be communicated to the successful bidder by 5:00 p.m., Local Time, on the Date of Sale. The dollar amount bid for the principal of the Bonds by the successful bidder will be adjusted as necessary to reflect any increase or decrease in the principal amount of the applicable maturities of the Bonds so adjusted, but the interest rates specified by the successful bidder for each maturity will not be altered. Such adjusted dollar amount bid will not change the successful bidder's compensation per $1,000 of par amount of the Bonds from that which would have resulted from the bid submitted. The successful bidder may not withdraw its bid as a result of any change made within the foregoing limits. Good Faith Deposit The successful bidder for the Bonds is required to submit a Good Faith Deposit in the amount of $80,000 payable to the order of the City of Virginia Beach in the form of a wire transfer in federal funds, as instructed by the City's Financial Advisor. The successful bidder must submit the Good Faith Deposit not later than 11:30 a.m., Local Time, on the next business day following the award. The successful bidder shall provide the federal funds reference number upon request. If the successful bidder fails to comply with the terms of its bid, the Good Faith Deposit shall be retained by the City as full liquidated damages; otherwise, the amount thereof will be applied to the purchase price of the Bonds at the time of delivery. No interest on the Good Faith Deposit will accrue to the successful bidder. 4 Delivery of the Bonds The Bonds will be delivered at the expense of the City in New York, New York, through the facilities of DTC on or about June 29, 2010. Concurrently with the delivery of the Bonds, the City will furnish to the successful bidder without cost (a) certificates dated the date of delivery of the Bonds, signed by the appropriate City officials and stating that no litigation of any kind is then pending or, to the best of their information, knowledge and belief, threatened against the City to restrain or enjoin the issuance or delivery of the Bonds or the levy or collection of ad valorem taxes and (b) certificates dated the date of delivery of the Bonds, stating that the descriptions and statements in the Official Statement (except in the section entitled "Tax Matters" and in the column "Yield" and "CUSIP" on the inside cover and in Appendix D), on the date of the Official Statement and on the date of delivery of the Bonds, were and are true and correct in all material respects, did not and do not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make such descriptions and statements, in light of the circumstances under which they were made, not misleading. Such certificates will also state, however, that such City officials did not independently verify the information indicated in the Official Statement as having been obtained or derived from sources other than the City and its officers but they have no reason to believe that such information is not accurate. Certificate of Winning Bidder The successful bidder must, by facsimile transmission or overnight delivery received by the City within 24 hours after receipt of the bids for the Bonds, furnish the following information to the City to complete the Official Statement in final form, as described below: A. The offering prices for the Bonds (expressed as the price or yield per maturity, exclusive of any accrued interest). B. Selling compensation (aggregate total anticipated compensation to the underwriters expressed in dollars, based on the expectation that all Bonds are sold at the prices or yields described in Subpart A above). C. The identity of the underwriters if the successful bidder is a part of a group or syndicate. D. Any other material information necessary to complete the Official Statement in final form but not known to the City. Prior to the delivery of the Bonds, the successful bidder shall furnish to the City a certificate in form acceptable to bond counsel, to the effect that the successful bidder has made a bona fide public offering of the Bonds at the initial public offering prices set forth in such certificate, that the successful bidder has complied with Rule G- 37 of the Municipal Securities Rulemaking Board (the "MSRB") with respect to the City and that a substantial amount of the Bonds of each maturity were sold to the public (excluding bond houses, brokers and other intermediaries) at such initial public offering prices. Such certificate shall state that (1) it is made on the best knowledge, information and belief of the successful bidder and (2) 10% or more in par amount of the Bonds of each maturity was reasonable expected to be sold on the Date of Sale to the public at the initial public offering price (such amount being sufficient to establish the sale of a substantial amount of the Bonds). CUSIP Numbers It is anticipated that CUSIP identification numbers will be printed on the Bonds, but neither the failure to print such numbers on any Bond nor any error with respect thereto shall constitute cause for failure or refusal by the successful bidder thereof to accept delivery of and pay for the Bonds in accordance with the terms of its bid. The City will assume responsibility for the expense of the initial printing of CUSIP numbers; provided, however, that the City assumes no responsibility for any CUSIP Service Bureau or other charges that may be imposed for the 5 I I assignment of such numbers. All expenses in connection with the assignment of CUSIP numbers shall be paid by the successful bidder. It shall be the obligation of the successful bidder to furnish to DTC an underwriter questionnaire and to the City the CUSIP numbers for the Bonds within two business days following the date of award. Official Statement The City will furnish the successful bidder at the expense of the City up to 250 copies of the fmal Official Statement by the earlier of the closing date and seven business days from the date of the award of the Bonds, as specified in Rule 15c2-12 (the "Rule") of the Securities and Exchange Commission (the "SEC") and the rules of the MSRB provided that minor delays in furnishing such final Official Statement will not be a basis for failure to pay for and accept delivery of the Bonds. Additional copies will be made available at the successful bidder's request and expense. The City assumes no responsibility or obligation for the distribution or delivery of the Official Statement to anyone other than the successful bidder. The successful bidder agrees to provide one copy of the Official Statement to the Municipal Securities Rulemaking Board using its Electronic Municipal Market Access System upon receipt of the Official Statement from the City and two copies of the Official Statement (with any required forms) to the MSRB or its designee no later than ten business days following the Date of Sale. The successful bidder shall notify the City as soon as practicable of (1) the date which is the end of the underwriting period (such "underwriting period" is described in the Rule), and (2) the date of filing the Official Statement with the MSRB or its designee. If the Bonds are awarded to a syndicate, the City will designate the senior managing underwriter of the syndicate as its agent for purposes of distributing copies of the Official Statement to each participating underwriter. Any underwriter executing and delivering a bid form with respect to the Bonds agrees thereby that if its bid is accepted it shall accept such designation and shall enter into a contractual relationship with all participating underwriters for the purposes of assuring the receipt and distribution by each such participating underwriter of the Official Statement, unless another firm is so designated by the syndicate in writing and approved by the City. Legal Opinion The approving opinion of Hunton & Williams LLP, Richmond, Virginia, Bond Counsel with respect to the Bonds will be furnished to the successful bidder at the expense of the City and will state that the Bonds constitute limited obligations of the City, payable solely from Pledged Revenues, as defined in the Preliminary Official Statement, dated , 2010, subject to the prior application thereof to the payment of Operating Expenses, and reserves established under the Resolution on a parity with other water and sewer system revenue bonds of the City. Federal and State Securities Laws No action has been taken to qualify the Bonds under the federal and Commonwealth securities laws. Tax Exemption The Preliminary Official Statement relating to the Bonds contains a discussion of the effect of the Internal Revenue Code of 1986, as amended, on the exclusion from gross income of interest on the Bonds and also contains the proposed form of the opinion of Hunton & Williams LLP insofar as it concerns such exclusion. Continuing Disclosure For purposes of the Rule, the City will agree, pursuant to the Continuing Disclosure Agreement, to provide certain annual financial information and operating data and notices of the occurrence of certain events, if material. A description of this undertaking is set forth in the Preliminary Official Statement for the Bonds and will also be set forth in the final Official Statement for the Bonds (See Appendix G of the Preliminary Official Statement dated , 2010). 6 Change of Date and Time for Receipt of Bids The City expects to take bids on the Bonds on June 17, 2010. However, the City reserves the right to postpone the date and time established for the receipt of bids. Any such postponement will be announced by the Thomson Municipal Newswire (TM3), or any other such service. If the receipt of bids is postponed, any alternative date for receipt of bids will be announced via TM3, or any other such service. Any bidder must submit a bid for the purchase of the Bonds on such alternative sale date in conformity with the provisions of this Official Notice of Sale, except for any changes announced via TM3, or any other such service used by the City for this purpose, as described therein. Additional Information For further information relating to the Bonds and the City, reference is made to the City's Preliminary Official Statement. The City has deemed the Preliminary Official Statement to be final as of its date within the meaning of the Rule, except for the omission of certain pricing and other information permitted to be omitted pursuant to the Rule. The Official Bid Form and the Preliminary Official Statement may be obtained from the City's Financial Advisor, Government Finance Associates, Inc. (telephone 212-521-4090). Dated: , 2010 CITY OF VIRGINIA BEACH, VIRGINIA By: James K. Spore City Manager 7 OFFICIAL NOTICE OF SALE CITY OF VIRGINIA BEACH, VIRGINIA $19,375,000* WATER AND SEWER SYSTEM REFUNDING REVENUE, SERIES 2010C Electronic bids only will be received by the City of Virginia Beach, Virginia (the "City"), in accordance with this Official Notice of Sale until 12:30 p.m., Local Time, on Thursday, June 17, 2010 (the "Date of Sale"). In the case of a malfunction in submitting an electronic bid, facsimile bids will be allowed, as more fully described below. Immediately thereafter, the bids will be publicly announced, and the City Manager will act upon the bids by 3:30 p.m., Local Time. Bid Submission Solely as an accommodation to bidders, electronic bids via BIDCOMP/PARITY (the "Electronic Bidding System") will be accepted in accordance with this Official Notice of Sale. The City is using BIDCOMP/PARITY as a communication mechanism to conduct the electronic bidding for the sale of $19,375,000* Water And Sewer System Refunding Revenue Bonds, Series 2010C (the "Bonds"), as described herein. To the extent any instructions or directions set forth in BIDCOMP/PARITY conflict with this Official Notice of Sale, the terms of this Official Notice of Sale shall control. Each bidder submitting an electronic bid agrees (i) that it is solely responsible for all arrangements with BIDCOMP/PARITY, (ii) that BIDCOMP/PARITY is not acting as the agent of the City, and (iii) that the City is not responsible for ensuring or verifying bidder compliance with any of the procedures of BIDCOMP/PARITY. The City assumes no responsibility for, and each bidder expressly assumes the risks of and responsibility for, any incomplete, inaccurate or untimely bid submitted by such bidder through BIDCOMP/PARITY. Each bidder shall be solely responsible for making necessary arrangements to access the Electronic Bidding System for purposes of submitting its bid in a timely manner and in compliance with the requirements of this Official Notice of Sale. Neither the City nor the Electronic Bidding System shall have any duty or obligation to provide or assure such access to any bidder, and neither the City nor BIDCOMP/PARITY shall be responsible for proper operation of, or have any liability for, any delays or interruptions of, or any damages caused by, BIDCOMP/PARITY. For further information about BIDCOMP/PARITY, potential bidders may contact BIDCOMP/PARITY at 1359 Broadway, 2nd Floor, New York, New York 10018, telephone (212) 849-5021. In the event of a malfunction of the Electronic Bidding System, facsimile transmission bids will be accepted up to 12:30 p.m., Local Time, on the Date of Sale. Bidders choosing to submit bids in the case of a malfunction by facsimile transmission shall use the following telecopier numbers for such transmission: (757) 385- 4302 or (757) 385-8894 (Attention: Patricia A. Phillips). Transmissions received after the deadline shall be rejected. It is the responsibility of the bidder to ensure that the bid is legible, that the bid is received not later than 12:30 p.m., Local Time, and that the bid is sent to one of the telecopier numbers set forth above. Illegible transmissions shall be rejected. The City's financial advisor, Government Finance Associates, Inc. ("Financial Advisor"), will, on behalf of the City, verify receipt of each bid submitted through facsimile transmission by contacting each bidder by telephone once the bid has been received. The Financial Advisor will in no instance correct, alter or in any way change bids submitted through facsimile transmission. Neither the City nor the Financial Advisor will be responsible for bids submitted by facsimile transmission not received in accordance with the provisions of this Official Notice of Sale. Bidders electing to submit bids via facsimile transmission will bear full and complete responsibility for the transmission of such bid. * Preliminary; subject to change. Each bid must be unconditional. Principal Redemption The Bonds will be public facility refunding revenue bonds of the City, dated the date of delivery (the "Dated Date"), and will mature serially or be subject to mandatory sinking fund redemptions on October 1 in the years and amounts shown below. Preliminary Preliminary Due October 1 Amount* Due October 1 Amount* 2010 $ 180,000 2017 $1,640,000 2011 165.000 2018 1,685,000 2012 170,000 2019 1,730,000 2013 1,515,000 2020 1,775,000 2014 1,545,000 2021 1,835,000 2015 1,580,000 2022 1,925,000 2016 1,610,000 2023 2,020,000 * Preliminary; subject to change. Serial Bonds, Term Bonds and Mandatory Sinking Fund Redemptions Bidders may provide in the bid form for all of the Bonds to be issued as serial Bonds or may designate consecutive annual principal amounts of the Bonds to be combined into not more than two Term Bonds. In the event that a bidder chooses to specify a Term Bond, each such Term Bond shall be subject to mandatory sinking fund redemption commencing on October 1 of the first year which has been combined to form such Term Bond and continuing on October 1 in each year thereafter until the stated maturity of such Term Bond. The amount redeemed in any year shall be equal to the principal amount for such year set forth in the amortization schedule above. Bonds to be redeemed in any year by mandatory sinking fund redemption shall be redeemed at par and shall be selected by lot from among the maturities of the Term Bond being redeemed. Description of the Bonds; Book -Entry Only System The Bonds will be issued by means of a book -entry system with no distribution of physical Bond certificates made to the public. One Bond certificate for each maturity will be issued to The Depository Trust Company, New York, New York ("DTC"), or its nominee, and immobilized in its custody. The book -entry system will evidence beneficial ownership of the Bonds in principal amounts of $5,000 or multiples thereof, with transfers of beneficial ownership effected on the records of DTC and its participants pursuant to rules and procedures established by DTC and its participants. Bond certificates registered in the name of Cede & Co. will be deposited with DTC. Interest on the Bonds will be paid semiannually on October 1 and April 1, beginning October 1, 2010, and principal on the Bonds will be paid annually on October 1, beginning October 1, 2010, to DTC or its nominee as registered owner of the Bonds. Transfer of principal and interest payments to beneficial owners by participants of DTC will be the responsibility of such participants and other nominees of beneficial owners. The City will not be responsible or liable for maintaining, supervising or reviewing the records maintained by DTC, its participants or persons acting through such participants. 2 DTC may discontinue providing its services as securities depository with respect to the Bonds at any time by giving reasonable notice to the City. Under such circumstances, in the event that a successor securities depository is not obtained, Bond certificates are required to be prepared, executed and delivered. The City may decide to discontinue use of the system of book -entry transfers through DTC (or a successor securities depository). In that case, either a successor depository will be selected by the City or Bond certificates will be prepared, executed and delivered. Optional Redemption The Bonds that mature on or before October 1, 2020 are not subject to optional redemption prior to their stated maturities. The Bonds that mature on and after October 1, 2021 will be subject to redemption beginning October 1, 2020, in whole or in part at any time, at the option and direction of the City, upon payment of the par amount of principal so redeemed plus interest accrued and unpaid to the redemption date. Security The Bonds are limited obligations of the City, payable solely from Pledged Revenues of the System, subject to the prior application thereof to the payment of Operating Expenses, and reserves therefore, as provided in the Resolution, as further described in the City's Preliminary Official Statement, dated , 2010. Neither the faith and credit of the Commonwealth of Virginia nor the faith and credit of any county, city, town or other subdivision of the Commonwealth of Virginia, including the City, are pledged to the payment of principal of or interest on the Bonds. In the Resolution, the City covenants to fix, charge, collect and revise its fees, rates and other charges for the use of and for the services furnished by the System in each Fiscal Year so as to produce revenues sufficient to pay the cost of operation and maintenance, the cost of necessary replacements and improvements and debt service on the Bonds and on any other indebtedness of the City secured by such revenues, and to provide certain reserves therefore. Use of Bond Proceeds As described in more detail in the City's Preliminary Official Statement, dated , 2010, the Bonds are being issued to provide funds for the refunding of a portion of the City's Water And Sewer System Revenue Bonds, Series of 2002, and to pay certain costs of issuance related to the Bonds. Bidding Rules; Award of Bonds Bidders may only bid to purchase all of the Bonds. Bidders are invited to name the rate or rates of interest per annum which the Bonds are to bear in multiples of one -twentieth (1/20th) or one-eighth (1/8th) of one percent. All Bonds maturing on the same date must bear interest at the same rate. Any number of rates may be named provided that (a) the highest rate of interest may not exceed the lowest rate of interest by more than 3 percentage points, and (b) the highest rate of interest stated for any maturity may not exceed 5.0% per annum, but in no event shall the "true" interest cost exceed 4.5%. No bid for less than 100% of par shall be considered. The City reserves the right to reject any or all bids (regardless of the interest rate bid), any bid not complying with this Official Notice of Sale and, so far as permitted by law, to waive any irregularity or informality with respect to any bid or the bidding process. As promptly as reasonably possible after the bids are received, the City will notify the bidder to whom the Bonds will be awarded, if and when such award is made. Such bidder, upon such notice, shall advise the City of the initial reoffering prices or yields to the public of each maturity of the Bonds (the "Initial Reoffering Prices or Yields") and details regarding the anticipated use of a municipal bond insurance policy, if any, in connection with the Bonds. The successful bidder must reasonably expect to sell to the public 10% or more in par amount of the Bonds from each maturity at the Initial Reoffering Prices or Yields. All bids will remain firm for a period of no less 3 than three hours after the time specified for the opening of bids. An award of the Bonds, if made, will be made by the City Manager within such three hour period or, with the express consent of the bidders, such longer time period as deemed necessary. Unless all bids are rejected, the Bonds will be awarded to the bidder complying with the terms of this Official Notice of Sale and submitting a bid which provides the lowest "true" interest cost to the City. True interest cost shall be determined for each bid by doubling the semiannual interest rate, compounded semiannually, necessary to discount the debt service payments from the payment dates to the Dated Date, which is the date of settlement, and to the bid price. If more than one bid offers the same lowest true interest cost, the successful bid will be selected by the City Manager by lot. The City reserves the right to reject any or all bids and to waive any irregularity or informality with respect to any bid. Bids for the Bonds shall not be conditioned upon obtaining insurance or any other credit enhancement. If a bidder proposes to obtain a policy of municipal bond insurance or any other credit enhancement, any such purchase of insurance or commitment therefor shall be at the sole option and expense of the bidder, and the bidder must pay any increased costs of issuance of the Bonds as a result of such insurance or commitment. Any failure by the bidder to obtain such a policy of insurance shall not in any way relieve such bidder of its contractual obligations arising from the acceptance of its bid for the purchase of the Bonds. Adjustment of Principal Amount Prior to the Opening of Bids The preliminary aggregate principal amount of the Bonds and the preliminary annual principal maturities of the Bonds, each as set forth in this Official Notice of Sale, may be revised by the City before the receipt of bids. Any such revisions made prior to receipt of the bids will be published via TM3 Newswire (or some other municipal newswire recognized by the municipal securities industry) and via BIDCOMP/PARITY no later than 9:00 a.m. (Local Time) on the Date of Sale. In the event that no such revisions are made, the preliminary amounts will constitute the amounts that shall be used for the bid and award of the Bonds, subject to further adjustment, as described below. Adjustment of Principal Amount After Award The City reserves the right, after the award of the Bonds to the successful bidder, to increase or decrease by up to ten percent (10%) the principal amount of the Bonds being offered hereby. The City may choose not to exercise such right to increase or decrease the principal amount of the Bonds being offered. Should the City decide to exercise this right, any such increase or decrease in the principal amount of particular maturities of the Bonds will be communicated to the successful bidder by 5:00 p.m., Local Time, on the Date of Sale. The dollar amount bid for the principal of the Bonds by the successful bidder will be adjusted as necessary to reflect any increase or decrease in the principal amount of the applicable maturities of the Bonds so adjusted, but the interest rates specified by the successful bidder for each maturity will not be altered. Such adjusted dollar amount bid will not change the successful bidder's compensation per $1,000 of par amount of the Bonds from that which would have resulted from the bid submitted. The successful bidder may not withdraw its bid as a result of any change made within the foregoing limits. Good Faith Deposit The successful bidder for the Bonds is required to submit a Good Faith Deposit in the amount of $200,000 payable to the order of the City of Virginia Beach in the form of a wire transfer in federal funds, as instructed by the City's Financial Advisor. The successful bidder must submit the Good Faith Deposit not later than 11:30 a.m., Local Time, on the next business day following the award. The successful bidder shall provide the federal funds reference number upon request. If the successful bidder fails to comply with the terms of its bid, the Good Faith Deposit shall be retained by the City as full liquidated damages; otherwise, the amount thereof will be applied to the purchase price of the Bonds at the time of delivery. No interest on the Good Faith Deposit will accrue to the successful bidder. 4 Delivery of the Bonds The Bonds will be delivered at the expense of the City in New York, New York, through the facilities of DTC on or about June 29, 2010. Concurrently with the delivery of the Bonds, the City will furnish to the successful bidder without cost (a) certificates dated the date of delivery of the Bonds, signed by the appropriate City officials and stating that no litigation of any kind is then pending or, to the best of their information, knowledge and belief, threatened against the City to restrain or enjoin the issuance or delivery of the Bonds or the levy or collection of ad valorem taxes and (b) certificates dated the date of delivery of the Bonds, stating that the descriptions and statements in the Official Statement (except in the section entitled "Tax Matters" and in the columns "Yield" and "CUSIP" on the inside cover and in Appendix D), on the date of the Official Statement and on the date of delivery of the Bonds, were and are true and correct in all material respects, did not and do not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make such descriptions and statements, in light of the circumstances under which they were made, not misleading. Such certificates will also state, however, that such City officials did not independently verify the information indicated in the Official Statement as having been obtained or derived from sources other than the City and its officers but they have no reason to believe that such information is not accurate. Certificate of Winning Bidder The successful bidder must, by facsimile transmission or overnight delivery received by the City within 24 hours after receipt of the bids for the Bonds, furnish the following information to the City to complete the Official Statement in final form, as described below: A. The offering prices for the Bonds (expressed as the price or yield per maturity, exclusive of any accrued interest). B. Selling compensation (aggregate total anticipated compensation to the underwriters expressed in dollars, based on the expectation that all Bonds are sold at the prices or yields described in Subpart A above). C. The identity of the underwriters if the successful bidder is a part of a group or syndicate. D. Any other material information necessary to complete the Official Statement in final form but not known to the City. Prior to the delivery of the Bonds, the successful bidder shall furnish to the City a certificate in form acceptable to bond counsel, to the effect that the successful bidder has made a bona fide public offering of the Bonds at the initial public offering prices set forth in such certificate, that the successful bidder has complied with Rule G- 37 of the Municipal Securities Rulemaking Board (the "MSRB") with respect to the City and that a substantial amount of the Bonds of each maturity were sold to the public (excluding bond houses, brokers and other intermediaries) at such initial public offering prices. Such certificate shall state that (1) it is made on the best knowledge, information and belief of the successful bidder and (2) 10% or more in par amount of the Bonds of each maturity was reasonable expected to be sold on the Date of Sale to the public at the initial public offering price (such amount being sufficient to establish the sale of a substantial amount of the Bonds). CUSIP Numbers It is anticipated that CUSIP identification numbers will be printed on the Bonds, but neither the failure to print such numbers on any Bond nor any error with respect thereto shall constitute cause for failure or refusal by the successful bidder thereof to accept delivery of and pay for the Bonds in accordance with the terms of its bid. The City will assume responsibility for the expense of the initial printing of CUSIP numbers; provided, however, that the City assumes no responsibility for any CUSIP Service Bureau or other charges that may be imposed for the 5 .11 assignment of such numbers. All expenses in connection with the assignment of CUSIP numbers shall be paid by the successful bidder. It shall be the obligation of the successful bidder to furnish to DTC an underwriter questionnaire and to the City the CUSIP numbers for the Bonds within two business days following the date of award. Official Statement The City will furnish the successful bidder at the expense of the City up to 250 copies of the fmal Official Statement by the earlier of the closing date and seven business days from the date of the award of the Bonds, as specified in Rule 15c2-12 (the "Rule") of the Securities and Exchange Commission (the "SEC") and the rules of the MSRB provided that minor delays in furnishing such final Official Statement will not be a basis for failure to pay for and accept delivery of the Bonds. Additional copies will be made available at the successful bidder's request and expense. The City assumes no responsibility or obligation for the distribution or delivery of the Official Statement to anyone other than the successful bidder. The successful bidder agrees to provide one copy of the Official Statement to the Municipal Securities Rulemaking Board using its Electronic Municipal Market Access System upon receipt of the Official Statement from the City and two copies of the Official Statement (with any required forms) to the MSRB or its designee no later than ten business days following the Date of Sale. The successful bidder shall notify the City as soon as practicable of (1) the date which is the end of the underwriting period (such "underwriting period" is described in the Rule), and (2) the date of filing the Official Statement with the MSRB or its designee. If the Bonds are awarded to a syndicate, the City will designate the senior managing underwriter of the syndicate as its agent for purposes of distributing copies of the Official Statement to each participating underwriter. Any underwriter executing and delivering a bid form with respect to the Bonds agrees thereby that if its bid is accepted it shall accept such designation and shall enter into a contractual relationship with all participating underwriters for the purposes of assuring the receipt and distribution by each such participating underwriter of the Official Statement, unless another firm is so designated by the syndicate in writing and approved by the City. Legal Opinion The approving opinion of Hunton & Williams LLP, Richmond, Virginia, Bond Counsel with respect to the Bonds will be furnished to the successful bidder at the expense of the City and will state that the Bonds constitute limited obligations of the City, payable solely from Pledged Revenues, as defined in the Preliminary Official Statement, dated , 2010, subject to the prior application thereof to the payment of Operating Expenses, and reserves established under the Resolution on a parity with other water and sewer system revenue bonds of the City. Federal and State Securities Laws No action has been taken to qualify the Bonds under the federal and Commonwealth securities laws. Tax Exemption The Preliminary Official Statement relating to the Bonds contains a discussion of the effect of the Internal Revenue Code of 1986, as amended, on the exclusion from gross income of interest on the Bonds and also contains the proposed form of the opinion of Hunton & Williams LLP insofar as it concerns such exclusion. Continuing Disclosure For purposes of the Rule, the City will agree, pursuant to the Continuing Disclosure Agreement, to provide certain annual financial information and operating data and notices of the occurrence of certain events, if material. A description of this undertaking is set forth in the Preliminary Official Statement for the Bonds and will also be set forth in the fmal Official Statement for the Bonds (See Appendix G of the Preliminary Official Statement dated , 2010). 6 Change of Date and Time for Receipt of Bids The City expects to take bids on the Bonds on June 17, 2010. However, the City reserves the right to postpone the date and time established for the receipt of bids. Any such postponement will be announced by the Thomson Municipal Newswire (TM3), or any other such service. If the receipt of bids is postponed, any alternative date for receipt of bids will be announced via TM3, or any other such service. Any bidder must submit a bid for the purchase of the Bonds on such alternative sale date in conformity with the provisions of this Official Notice of Sale, except for any changes announced via TM3, or any other such service used by the City for this purpose, as described therein. Additional Information For further information relating to the Bonds and the City, reference is made to the City's Preliminary Official Statement. The City has deemed the Preliminary Official Statement to be fmal as of its date within the meaning of the Rule, except for the omission of certain pricing and other information permitted to be omitted pursuant to the Rule. The Official Bid Form and the Preliminary Official Statement may be obtained from the City's Financial Advisor, Government Finance Associates, Inc. (telephone 212-521-4090). Dated: , 2010 CITY OF VIRGINIA BEACH, VIRGINIA By: James K. Spore City Manager 7 - 35 - Item L.3. ORDINANCES/RESOLUTIONS ITEM # 59981 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to DECLARE City property EXCESS at 280 London Bridge Road and AUTHORIZE the City Manager to sell the property to Robert F. Sutherland Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 11 1 AN ORDINANCE DECLARING THE 2 PROPERTY LOCATED AT 280 LONDON 3 BRIDGE ROAD (GPIN: 1497-91-4844) TO BE 4 IN EXCESS OF THE CITY'S NEEDS AND 5 AUTHORIZING THE CITY MANAGER TO 6 SELL THE PROPERTY TO ROBERT F. 7 SUTHERLAND 8 9 WHEREAS, the City of Virginia Beach (the "City") is the owner of a parcel of land 10 located at 280 London Bridge Road (GPIN: 1497-91-4844) (the "Property); 11 12 WHEREAS, the Property represents the residual unused portion of land that the 13 City acquired for the London Bridge Road Project; 14 15 WHEREAS, Robert F. Sutherland ("Sutherland") owns a parcel of land adjacent 16 to the Property; 17 18 WHEREAS, Sutherland would like to purchase the Property and incorporate it 19 into his existing parcel by vacating the property line between the Property and his 20 existing parcel; 21 22 WHEREAS, Sutherland has offered the City $2,500 for the Property; and 23 24 WHEREAS, the City Council is of the opinion that the Property is in excess of the 25 needs of the City of Virginia Beach. 26 27 NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF 28 VIRGINIA BEACH, VIRGINIA: 29 30 1. That the Property is hereby declared to be in excess of the needs of the City 31 of Virginia Beach and that the City Manager is hereby authorized to execute any 32 documents necessary to convey the Property to Robert F. Sutherland in substantial 33 conformity to the Summary of Terms attached hereto and made a part hereof, and such 34 other terms, conditions or modifications deemed necessary and sufficient by the City 35 Manager and in a form deemed satisfactory by the City Attorney. 36 37 2. That the funds received from the sale of the Property shall be applied first to 38 any reimbursement due to the state, if applicable, and the balance to be placed in the 39 Various Site Acquisitions Fund (CIP 3-368). 40 41 This ordinance shall be effective from the date of its adoption. 42 43 Adopted by the Council of the City of Virginia Beach, Virginia, on the25th day 44 of May , 2010. APPROVED AS TO CONTENT Iic Works RFRCs4 ( APPROVED AS TO LEGAL SUFFICIENCY loaeolet City Attorney's Office CA -11393 vbg ov. com\DFS 1 \ Applications \CityLawProd\cyc om32\ W pdocs\D009\P007\00034914. DOC R-1 5/17/10 SUMMARY OF TERMS SALE OF EXCESS PROPERTY ON LONDON BRIDGE ROAD SELLER: City of Virginia Beach PURCHASER: Robert F. Sutherland PROPERTY: Approximately .088 acres of land located at 280 London Bridge Road (GPIN: 1497-91-4844) PURCHASE PRICE: $2,500.00 CONDITIONS OF SALE: • Purchaser shall have a 60 -day Due Diligence Period to determine suitability of the Property. • Purchaser shall, at the Purchaser's expense, re -subdivide the Property and vacate internal lot lines to incorporate the Property into Purchaser's existing property. • Purchaser shall submit a site plan for review and approval by the Planning Department prior to any construction on the Property. I II I II - 36 - Item L.4. ORDINANCES/RESOLUTIONS ITEM # 59982 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to ESTABLISH the rights-of-way of Princess Anne Road between Oakmears Crescent and Hampshire Lane, Witchduck Road and Kempsville Road between Bonney Road and Chief Trail as underground utility corridors and AUTHORIZE the Director of Public Works to EXECUTE Agreements for reimbursement of costs with the Virginia Department of Transportation (VDOT) and the utility owners Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 1 AN ORDINANCE TO ESTABLISH THE NEW PRINCESS 2 ANNE ROAD RIGHT-OF-WAY BETWEEN OAKMEARS 3 CRESCENT AND HAMPSHIRE LANE AND WITCHDUCK 4 ROAD/KEMPSVILLE ROAD BETWEEN BONNEY ROAD AND 5 CHIEF TRAIL AS UNDERGROUND UTILITY CORRIDORS 6 7 8 WHERAS, the Princess Anne Road / Kempsville Road Intersection Project CIP 2- 9 048, UPC 51866, the "Project," has been approved by City Council in order to widen and 10 improve the current section of roadway within the limits of the Project. 11 12 WHEREAS, the City of Virginia Beach also wishes to improve the safety and 13 aesthetics of this road for the benefit of the surrounding community and the traveling 14 public; 15 16 WHEREAS, the Council had previously requested the Virginia Department of 17 Transportation ("VDOT") to program this project; 18 19 WHEREAS, VDOT has adopted a policy to pay 50% of the additional costs to 20 relocate existing overhead private utility lines underground, which requires the City to adopt 21 an ordinance to establish the limits of underground utility districts, corridors or areas; 22 23 WHEREAS, City Council has appropriated sufficient funding, through the City of 24 Virginia Beach Capital Improvement Program, to pay the City's share of estimated cost to 25 relocate existing overhead utility lines underground. 26 27 NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF 28 VIRGINIA BEACH, VIRGINIA: 29 30 1. The rights-of-way of Princess Anne Road between Oakmears Crescent and 31 Hampshire Lane and Witchduck Road/Kempsville Road between Bonney Road 32 and Chief Trail, are hereby designated as underground utility corridors, and all new 33 utilities installed within the respective rights-of-way shall be placed underground; 34 and 35 36 2. The Director of Public Works is hereby authorized to execute agreements with 37 VDOT and the utility owners within the rights-of-way of the Project, for the 38 necessary utility relocations. 39 40 Adopted by the Council of the City of Virginia Beach, Virginia, on the 25th day of 41 42 May , 2010. CA11415 PREPARED: 4/30/2010 R-1 \\vbgov.com\dfs 1 \applications\citylawprod\cycom32\wpdocs\d023\p007\00053257.doc APPROVED AS TO CONTENT Department of Public Works APPROVED AS TO LEGAL SUFFICIENCY AND FORM City "Attorney's O1fl e - 37 - Item L 5. ORDINANCES/RESOLUTIONS ITEM # 59983 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT:• Ordinances to AUTHORIZE acquisition of Agricultural Land Preservation (ARP) easements to Whale Wallow, L.C.: a. 772 Princess Anne Road $1,617,805 b. 756 Princess Anne Road $1,290,666 Voting: 10-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Abstaining: William R. "Bill" DeSteph Council Members Absent: None May 25, 2010 11 I u I N 1 AN ORDINANCE AUTHORIZING THE ACQUISITION OF AN 2 AGRICULTURAL LAND PRESERVATION EASEMENT AND 3 THE ISSUANCE BY THE CITY OF ITS CONTRACT 4 OBLIGATIONS IN THE MAXIMUM PRINCIPAL AMOUNT OF 5 $1,617,805 (WHALE WALLOW, L.C.) 6 7 WHEREAS, pursuant to the Agricultural Lands Preservation Ordinance (the 8 "Ordinance"), Appendix J of the Code of the City of Virginia Beach, there has been 9 presented to the City Council a request for approval of an Installment Purchase Agreement 10 (the form and standard provisions of which have been previously approved by the City 11 Council, a summary of the material terms of which is hereto attached, and a true copy of 12 which is on file in the City Attorney's Office) for the acquisition of the Development Rights 13 (as defined in the Installment Purchase Agreement) on certain property located in the City 14 and more fully described in Exhibit B of the Installment Purchase Agreement for a 15 purchase price of $1,617,805; and 16 17 WHEREAS, the aforesaid Development Rights shall be acquired through the 18 acquisition of a perpetual agricultural land preservation easement, as defined in, and in 19 compliance with, the requirements of the Ordinance; and 20 21 WHEREAS, the City Council has reviewed the proposed terms and conditions of the 22 purchase as evidenced by the Installment Purchase Agreement; 23 24 NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF 25 VIRGINIA BEACH, VIRGINIA: 26 27 1. The City Council hereby determines and finds that the proposed terms and 28 conditions of the purchase of the Development Rights pursuant to the Installment Purchase 29 Agreement, including the purchase price and manner of payment, are fair and reasonable 30 and in furtherance of the purposes of the Ordinance, and the City Manager or his designee 31 is hereby authorized to approve, upon or before the execution and delivery of the 32 Installment Purchase Agreement, the rate of interest to accrue on the unpaid principal 33 balance of the purchase price set forth hereinabove as the greater of 3.8400% per annum 34 or the per annum rate which is equal to the yield on United States Treasury STRIPS 35 purchased by the City to fund such unpaid principal balance; provided, however, that such 36 rate of interest shall not exceed 6.8400% unless the approval of the City Council by 37 resolution duly adopted is first obtained. 38 39 2. The City Council hereby further determines that funding is available for the 40 acquisition of the Development Rights pursuant to the Installment Purchase Agreement on 41 the terms and conditions set forth therein. 42 43 3. The City Council hereby expressly approves the Installment Purchase 44 Agreement and, subject to the determination of the City Attorney that there are no defects 45 in title to the property or other restrictions or encumbrances thereon which may, in the 46 opinion of the City Attorney, adversely affect the City's interests, authorizes the City 47 Manager or his designee to execute and deliver the Installment Purchase Agreement in 48 substantially the same form and substance as approved hereby with such minor 49 modifications, insertions, completions or omissions which do not materially alter the 50 purchase price or manner of payment, as the City Manager or his designee shall approve. 51 The City Council further directs the City Clerk to affix the seal of the City to, and attest 52 same on, the Installment Purchase Agreement. The City Council expressly authorizes the 53 incurrence of the indebtedness represented by the issuance and delivery of the Installment 54 Purchase Agreement. 55 56 4. The City Council hereby elects to issue the indebtedness under the Charter 57 of the City rather than pursuant to the Public Finance Act of 1991 and hereby constitutes 58 the indebtedness a contractual obligation bearing the full faith and credit of the City. 59 60 Adoption requires an affirmative vote of a majority of all members of the City 61 Council. 62 63 Adopted by the Council of the City of Virginia Beach, Virginia, on this 25th day of 64 May , 2010. CA11419 \\vbgov. com\DFS1Wpplications\CityLawProd\cycom32\Wpdocs\D007\P007\00055001. DOC R-1 DATE: May 10, 2010 APPROVED AS TO CONTENT: APPROVED AS TO LEGAL SUFFICIENCY: aY� Agriculture Department City Attorney's Office CERTIFIED AS TO AVAILABILITY OF FUNDS: r Director of Finance 2 AGRICULTURAL RESERVE PROGRAM INSTALLMENT PURCHASE AGREEMENT NO. 2010-105 SUMMARY OF MATERIAL TERMS SELLER: WHALE WALLOW, L.C. PROPERTY LOCATION: 772 Princess Anne Road, Princess Anne District PURCHASE PRICE: $1,617,805 EASEMENT AREA: 135.95 acres, more or less DEVELOPMENT POTENTIAL: 18 single-family dwelling sites (17 acquired) DURATION: Perpetual INTEREST RATE: Equal to yield on U.S. Treasury STRIPS acquired by City to fund purchase price, but not less than 3.8400% (actual rate to be determined when STRIPS are purchased prior to execution of IPA). Rate may not exceed 6.8400% without approval of City Council. TERMS: Interest only twice per year for 25 years, with payment of principal due 25 years from IPA date RESTRICTIONS ON TRANSFER: IPA ownership may not be transferred (except for Estate Settlement Transfer) for one (1) year following execution and delivery of IPA. 1 AN ORDINANCE AUTHORIZING THE ACQUISITION OF AN 2 AGRICULTURAL LAND PRESERVATION EASEMENT AND 3 THE ISSUANCE BY THE CITY OF ITS CONTRACT 4 OBLIGATIONS IN THE MAXIMUM PRINCIPAL AMOUNT OF 5 $1,290,666 (WHALE WALLOW, L .C.) 6 7 WHEREAS, pursuant to the Agricultural Lands Preservation Ordinance (the 8 "Ordinance"), Appendix J of the Code of the City of Virginia Beach, there has been 9 presented to the City Council a request for approval of an Installment Purchase Agreement 10 (the form and standard provisions of which have been previously approved by the City 11 Council, a summary of the material terms of which is hereto attached, and a true copy of 12 which is on file in the City Attorney's Office) for the acquisition of the Development Rights 13 (as defined in the Installment Purchase Agreement) on certain property located in the City 14 and more fully described in Exhibit B of the Installment Purchase Agreement for a 15 purchase price of $1,290,666; and 16 17 WHEREAS, the aforesaid Development Rights shall be acquired through the 18 acquisition of a perpetual agricultural land preservation easement, as defined in, and in 19 compliance with, the requirements of the Ordinance; and 20 21 WHEREAS, the City Council has reviewed the proposed terms and conditions of the 22 purchase as evidenced by the Installment Purchase Agreement; 23 24 NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF 25 VIRGINIA BEACH, VIRGINIA: 26 27 1. The City Council hereby determines and finds that the proposed terms and 28 conditions of the purchase of the Development Rights pursuant to the Installment Purchase 29 Agreement, including the purchase price and manner of payment, are fair and reasonable 30 and in furtherance of the purposes of the Ordinance, and the City Manager or his designee 31 is hereby authorized to approve, upon or before the execution and delivery of the 32 Installment Purchase Agreement, the rate of interest to accrue on the unpaid principal 33 balance of the purchase price set forth hereinabove as the greater of 3.8400% per annum 34 or the per annum rate which is equal to the yield on United States Treasury STRIPS 35 purchased by the City to fund such unpaid principal balance; provided, however, that such 36 rate of interest shall not exceed 6.8400% unless the approval of the City Council by 37 resolution duly adopted is first obtained. 38 39 2. The City Council hereby further determines that funding is available for the 40 acquisition of the Development Rights pursuant to the Installment Purchase Agreement on 41 the terms and conditions set forth therein. 42 43 3. The City Council hereby expressly approves the Installment Purchase 44 Agreement and, subject to the determination of the City Attorney that there are no defects 45 in title to the property or other restrictions or encumbrances thereon which may, in the 46 opinion of the City Attorney, adversely affect the City's interests, authorizes the City 47 Manager or his designee to execute and deliver the Installment Purchase Agreement in 48 substantially the same form and substance as approved hereby with such minor 49 modifications, insertions, completions or omissions which do not materially alter the 50 purchase price or manner of payment, as the City Manager or his designee shall approve. 51 The City Council further directs the City Clerk to affix the seal of the City to, and attest 52 same on, the Installment Purchase Agreement. The City Council expressly authorizes the 53 incurrence of the indebtedness represented by the issuance and delivery of the Installment 54 Purchase Agreement. 55 56 4. The City Council hereby elects to issue the indebtedness under the Charter 57 of the City rather than pursuant to the Public Finance Act of 1991 and hereby constitutes 58 the indebtedness a contractual obligation bearing the full faith and credit of the City. 59 60 Adoption requires an affirmative vote of a majority of all members of the City 61 Council. 62 63 Adopted by the Council of the City of Virginia Beach, Virginia, on this 25th day of 64 May , 2010. CA11420 \\vbgov.com\DFS1Wpplications\CityLawProd\cycom32\Wpdocs\D007\P007\00055009.DOC R-1 DATE: May 10, 2010 APPROVED AS TO CONTENT: APPROVED AS TO LEGAL SUFFICIENCY: Agriculture Department UuG tO�Uti�kc� City Attorney'sOffice CERTIFIED AS TO AVAILABILITY OF FUNDS: Ct Director of Finance 2 AGRICULTURAL RESERVE PROGRAM INSTALLMENT PURCHASE AGREEMENT NO. 2010-106 SUMMARY OF MATERIAL TERMS SELLER: WHALE WALLOW, L.C. PROPERTY LOCATION: 756 Princess Anne Road, Princess Anne District PURCHASE PRICE: $1,290,666 EASEMENT AREA: 110.97 acres, more or less DEVELOPMENT POTENTIAL: 13 single-family dwelling sites (12 acquired) DURATION: Perpetual INTEREST RATE: Equal to yield on U.S. Treasury STRIPS acquired by City to fund purchase price, but not less than 3.8400% (actual rate to be determined when STRIPS are purchased prior to execution of IPA). Rate may not exceed 6.8400% without approval of City Council. TERMS: Interest only twice per year for 25 years, with payment of principal due 25 years from IPA date RESTRICTIONS ON TRANSFER: IPA ownership may not be transferred (except for Estate Settlement Transfer) for one (1) year following execution and delivery of IPA. - 38 - Item L.6. ORDINANCES/RESOLUTIONS ITEM # 59984 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to AUTHORIZE the City Manager to EXECUTE a Lease for vehicular parking with the Dolphin Run Condominium Association, Inc. at 3rd Street and Atlantic Avenue Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 1 AN ORDINANCE AUTHORIZING THE CITY 2 MANAGER TO EXECUTE A FOUR-MONTH LEASE 3 WITH DOLPHIN RUN CONDOMINIUM 4 ASSOCIATION, INC. FOR A 0.09 -ACRE PARCEL 5 OF CITY -OWNED LAND LOCATED AT THE 6 INTERSECTION OF 3rd STREET AND ATLANTIC 7 AVENUE 8 9 WHEREAS, the City of Virginia Beach ("the City") is the owner of a parcel 10 of land consisting of 0.09 acres and located at the intersection of 3rd Street and 11 Atlantic Avenue in Virginia Beach, Virginia (the "Premises"); 12 13 WHEREAS, Dolphin Run Condominium Association, Inc. ("Dolphin Run"), 14 a Virginia non -stock corporation, has agreed to pay the City $4,320 for the use of 15 the Premises for a four-month period; 16 17 WHEREAS, Dolphin Run would like to enter into a formal lease 18 arrangement with the City for use of the Premises; 19 20 WHEREAS, the Premises will be utilized as an overflow parking lot for the 21 registered guests of Dolphin Run, and for no other purpose; 22 23 NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE 24 CITY OF VIRGINIA BEACH, VIRGINIA: 25 26 That the City Manager is hereby authorized to execute a lease for a term 27 of four (4) months between Dolphin Run Condominium Association, Inc. and the 28 City, for the Premises in accordance with the Summary of Terms attached hereto 29 and such other terms, conditions or modifications as may be acceptable to the 30 City Manager and in a form deemed satisfactory to the City Attorney. 31 32 Adopted by the Council of the City of Virginia Beach, Virginia on the 25thday of 33 May ,2010. CA11417 R-1 5/12/2010 \\vbgov. com\dfs 1 \applications\citylawprod\cycom 32\wpdocs\d027\p006\00053578.doc APPROVED AS TO LEGAL SUFFICIENCY AND FORM City Attorney APPROVED AS TO CONTENT mer5t ana Facilities ge I SUMMARY OF TERMS LEASE FOR THE USE OF 0.09 -ACRES OF CITY -OWNED PROPERTY LESSOR: City of Virginia Beach LESSEE: Dolphin Run Condominium Association, Inc. PREMISES: Approximately .09 -acre parcel of City -owned property located at the intersection of 3rd Street and Atlantic Avenue (GPIN: 2427-32- 0138) TERM: May 15, 2010, through September 15, 2010 RENT: $4,320 for entire term RIGHTS AND RESPONSIBILITIES OF LESSEE: • Use the Premises for overflow parking for guests and for no other purpose. • Maintain the Premises. • Maintain commercial general liability insurance coverage with policy limits of not less than one million dollars ($1,000,000) combined single limits per occurrence. • Maintain Automobile Liability Insurance including coverage for non -owned and hired vehicles in an amount not less than five hundred thousand dollars ($500,000) combined single limits. RIGHTS AND RESPONSIBILITIES OF CITY: • May access the Premises at any time, without prior notice to Lessee, in the event of an emergency or public necessity. • May require Lessee to surrender possession and control of the Premises to the City upon forty-eight (48) hours' prior notice if needed for public purposes. • May grant easements and rights-of-way across the Premises for streets, alleys, public highways, drainage, and other similar purposes. TERMINATION: • The City may terminate the Lease upon thirty (30) days' prior written notice to Lessee. Interstate — Primary Roads — Streets Parcel Water Bodies Dolphin Run Lease Location 0.09 Acres at 3rd Street and Atlantic Avenue N SCALE 1 ° 1,767 r 1 .00 J 1Co 2x 3.73 FEET - 39 - Item L.7. ORDINANCES/RESOLUTIONS ITEM # 59985 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to AUTHORIZE and DIRECT the City Manager to EXECUTE a Lease with T -Mobile re telecommunications at 616 North Great Neck Road Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 1 AN ORDINANCE TOAWARDA LEASE OF CITY PROPERTY 2 TO T -MOBILE NORTHEAST, L.L.C. FOR THE PURPOSE OF 3 MAINTAINING AND OPERATING WIRELESS 4 TELECOMMUNICATIONS FACILITIES 5 6 WHEREAS, the City of Virginia Beach (the "City") is the owner of certain property 7 located at 616 North Great Neck Road, in the Beach District (the "Property"); and 8 9 WHEREAS, T -Mobile Northeast, L.L.C. ("T -Mobile") has leased a portion of the 10 aforesaid property from the City since March 2004 to operate certain facilities for the 11 purpose of providing wireless telecommunications services to the general public; and 12 13 WHEREAS, the said lease has expired; and 14 15 WHEREAS, T -Mobile desires to continue to lease a portion of the Property, together 16 with easements for vehicular and pedestrian access and for the installation, maintenance 17 and replacement of necessary utilities, wiring, cables and other conduits for the purpose of 18 maintaining and operating the existing wireless telecommunications facilities currently 19 located upon the property; and 20 21 WHEREAS, T -Mobile has continued to pay to the City all rents due and owing since 22 the expiration of the prior lease, and desires to enter into a new five-year lease upon the 23 same material terms and conditions as the expired lease, with an adjustment in the rent 24 due the City; and 25 26 NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF 27 VIRGINIA BEACH, VIRGINIA: 28 29 1. That the City Manager is hereby authorized and directed to execute, on 30 behalf of the City, the lease entitled GROUND LEASE AGREEMENT (GREAT NECK 31 DOMINION TOWER) CITY OF VIRGINIA BEACH, LESSOR AND T -MOBILE 32 NORTHEAST LLC, LESSEE, dated March 24, 2010, a summary of the material terms of 33 which lease is hereto attached and a copy of which is on file in the Office of the City 34 Attorney. Adopted by the Council of the City of Virginia Beach, Virginia, on the 25th day of May , 2010. APPROVED AS TO CONTENT: APPROVED AS TO LEGAL artna. blic Works/Real Estate CA11510 R-2 April 30, 2010 SUFF CI ICY: „/ /1/ di G,%,P,&d City Attorney's Office Location: Lessee: Leased Area: Term: Rent: Other: T MOBILE LEASE AGREEMENT Summary of Material Terms 616 N. Great Neck Road (intersection with West Plantation Road), Beach District T -Mobile Northeast, LLC 25' x 25' site, with access and maintenance easements, for accessory outbuilding housing telecommunications equipment Five years with no right of renewal $13,709 per year (first year), payable in advance, with annual CPI increase Lessee required to comply with all City ordinances and other requirements Lessee required to remove facilities and restore site to original condition upon expiration or termination of lease Lessee to reimburse City for cost of public notice i 'c Copyri • t 2007, Pictome I Internationa F vera.:- `MIMS11K. -40 - Item L.8. ORDINANCES/RESOLUTIONS ITEM # 59986 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to AUTHORIZE and DIRECT the City Manager to EXECUTE a Virginia Water and Wastewater Agency Response Network Mutual Aid Agreement Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer, Barbara M Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 1 A RESOLUTION AUTHORIZING AND DIRECTING THE 2 CITY MANAGER TO EXECUTE A VIRGINIA WATER AND 3 WASTEWATER AGENCY RESPONSE NETWORK 4 MUTUAL AID AGREEMENT 5 6 7 WHEREAS, the National Infrastructure Protection Plan and, in particular, the 8 Sector Specific Plan for the Water Sector developed by the United States 9 Environmental Protection Agency identifies the development of a Water and 10 Wastewater Agency Response Network in each State as an important means of helping 11 to ensure resilient water and wastewater infrastructure in the public interest; and 12 13 WHEREAS, in furtherance of such national Water Sector plan, Virginia's 14 longstanding, nationally -recognized professional associations known as the Virginia 15 Section of the American Water Works Association and the Virginia Water Environment 16 Association have jointly formed the Virginia Water and Wastewater Agency Response 17 Network ("VA WARN") Committee to develop the EPA -recommended network and 18 associated procedures for implementation in Virginia; and 19 20 WHEREAS, the VA WARN Committee has developed the attached form of a VA 21 WARN Mutual Aid Agreement for use by public and private Water Sector utilities for 22 purposes of requesting assistance and responding to such requests as well as a related 23 form of an Event Agreement for providing assistance of a defined scope on defined 24 terms and conditions; and 25 26 WHEREAS, this VA WARN Mutual Aid Agreement is intended to supplement and 27 integrate with the Statewide Mutual Aid Program administered by the Virginia 28 Department of Emergency Management, with the Emergency Management Assistance 29 Compact, and with other mutual aid agreements of local, intrastate and interstate scope; 30 and 31 32 WHEREAS, the City of Virginia Beach owns public water and wastewater 33 facilities that the Department of Public Utilities operates, is responsible for management 34 of these facilities in the Commonwealth of Virginia, and is therefore eligible to participate 35 in VA WARN and the VA WARN Mutual Aid Agreement; 36 37 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY 38 OF VIRGINIA BEACH: 39 40 That the City Manager is hereby authorized and directed to execute, on behalf of 41 the City, the "Virginia Water and Wastewater Agency Response Network Mutual Aid 42 Agreement," a summary of the material terms of which is hereto attached, and a true 43 copy of which is on file with the Department of Public Utilities. 44 Adopted by the Council of the City of Virginia on this 25th day of May , 2010. APPROVED AS TO CONTENT: APPROVED AS TO LEGAL SUFFICIENCY: 044042 )71/) Department of Public Utilities CA11509 R-2 May 10, 2010 City Attorney's Office 2 PARTIES: SUBJECT: TERM: COST: OTHER: VA WARN AGREEMENT SUMMARY OF MATERIAL TERMS Numerous localities and service providers throughout Virginia Agreement for mutual assistance in cases of damage to utility facilities in cases of emergency Indefinite, but City may withdraw at any time upon 30 days' notice No cost to join as member of VA WARN; costs of response to individual emergencies are responsibility of Requesting Utility unless otherwise agreed Members are not required to provide assistance when requested to do so; if assistance is provided, scope may be modified at any time by either Requesting Utility or Assisting Utility Personnel used in responding to requests for assistance by Requesting Utility are subject to direction and control of Assisting Utility Assisting Utility may withdraw personnel upon 24 hours' notice except when such notice is impracticable -41 - Item L.9. ORDINANCES/RESOLUTIONS ITEM # 59987 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to AUTHORIZE temporary encroachments into a portion of City -owned right-of-way for EDWARD F. and CHRISTEL L. LEWIS at Croatan Beach, 522 South Atlantic Avenue, to construct and maintain an elevated wood walk, steps and observation platform for beach access. DISTRICT 6 — BEACH The following conditions shall be required: 1. For and in consideration of the premises and of the benefits accruing, or to accrue, to the Grantee and for the further consideration of One Dollar ($1.00), in hand paid to the City, receipt of which is hereby acknowledged, the City hereby grants to the Grantee permission to use the Encroachment Area for the purpose of constructing and maintaining the Temporary Encroachment. 2. The Temporary Encroachment will be constructed and maintained in accordance with the laws of the Commonwealth of Virginia and the City of Virginia Beach, and in accordance with the City's specifications and approval and is more particularly described as follows, to wit: 3. Providing however, nothing herein shall prohibit the City from immediately removing, or ordering the Grantee to remove, all or any part of the Temporary Encroachment from the Encroachment Area in the event of an emergency or public necessity, and Grantee shall bear all costs and expenses of such removal. 4. The Temporary Encroachment herein authorized terminates upon notice by the City to the Grantee, and that within thirty (30) days after the notice is given, the Temporary Encroachment must be removed from the Encroachment Area by the Grantee; and that the Grantee will bear all costs and expenses of such removal. 5. The Grantee shall indemnify, hold harmless and defend the City, its agents and employees, from and against all claims, damages, losses and expenses, including reasonable attorney's fees, in case it shall be necessary to file or defend an action arising out of the construction, location or existence of the Temporary Encroachment. 6. Nothing herein contained shall be construed to enlarge the permission and authority to permit the maintenance or construction of any encroachment other than that specified herein and to the limited extent specified herein, nor to permit the maintenance and construction of any encroachment by anyone other than the Grantee. 7. The Grantee agrees to maintain the Temporary Encroachment so as not to become unsightly or a hazard. 8. The Grantee must obtain a permit from the Department of Planning prior to commencing any construction within the Encroachment Area (the "Permit") May 25, 2010 I - 42 - Item L.9. ORDINANCES/RESOLUTIONS ITEM # 59987 (Continued) 9. The seaward extent of the Temporary Encroachment shall not extend past the eastward toe of the sand dune. 10. The Grantee must obtain and keep in force all-risk property insurance and general liability or such insurance as is deemed necessary by the City, and all insurance policies must name the City as additional named insured or loss payee, as applicable. The Grantee also agrees to carry comprehensive general liability insurance in an amount not less than $500, 000.00, combined single limits of such insurance policy or policies. The Grantee will provide endorsements providing at least thirty (30) days written notice to the City prior to the cancellation or termination of or material change to, any of the insurance policies. The Grantee assumes all responsibilities and liabilities, vested or contingent, with relation to the construction, location and/or existence of the Temporary Encroachment. 11. The Temporary Encroachment must conform to the minimum setback requirements, as established by the City. 12. The Grantee must submit for review and approval, a survey of the Encroachment Area, certified by a registered professional engineer or a licensed land surveyor, and/or "as built" plans of the Temporary Encroachment sealed by a Registered Professional Engineer, if required by either the City Engineer's Office or the Engineering Division of the Public Utilities Department. 13. The City, upon revocation of such authority and permission so granted, may remove the Temporary Encroachment and charge the cost thereof to the Grantee, and collect the cost in any manner provided by law for the collection of local or state taxes; may require the Grantee to remove the Temporary Encroachment; and pending such removal, the City may charge the Grantee for the use of the Encroachment Area, the equivalent of what would be the real property tax upon the land so occupied if it were owned by the Grantee; and if such removal shall not be made within the time ordered hereinabove by this Agreement, the City may impose a penalty in the sum of One Hundred Dollars ($100.00) per day for each and every day that the Temporary Encroachment is allowed to continue thereafter, and may collect such compensation and penalties in any manner provided by law for the collection of local or state taxes. Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 I 1 Requested by Department of Public Works 2 3 AN ORDINANCE TO AUTHORIZE 4 TEMPORARY ENCROACHMENTS 5 INTO A PORTION OF CITY 6 PROPERTY KNOWN AS CROATAN 7 BEACH LOCATED AT THE REAR OF 8 522 S. ATLANTIC AVENUE FOR 9 PROPERTY OWNERS EDWARD F. 10 LEWIS AND CHRISTEL L. LEWIS 11 12 WHEREAS, Edward F. Lewis and Christel L. Lewis, desire to construct and 13 maintain an elevated wood walk, steps and observation platform upon a portion of City 14 property known as Croatan Beach, located at the rear of 522 S. Atlantic Avenue, 15 Virginia Beach, Virginia; and 16 17 WHEREAS, City Council is authorized pursuant to §§ 15.2-2009 and 15.2-2107, 18 Code of Virginia, 1950, as amended, to authorize temporary encroachments upon the 19 City's property subject to such terms and conditions as Council may prescribe. 20 21 NOW, THEREFORE BE IT ORDAINED BY THE COUNCIL OF THE CITY OF 22 VIRGINIA BEACH, VIRGINIA: 23 That pursuant to the authority and to the extent thereof contained in §§ 15.2- 24 2009 and 15.2-2107, Code of Virginia, 1950, as amended, Edward F. Lewis and 25 Christel L. Lewis, their heirs, assigns and successors in title are authorized to construct 26 and maintain temporary encroachments for an elevated wood walk, steps and 27 observation platform on a portion of the City's property as shown on the map marked 28 Exhibit "A" and entitled: "PLAT SHOWING ENCROACHMENT OF ELEVATED WOOD 29 WALK, STEPS & OBSERVATION PLATFORM ON PUBLIC BEACH ADJACENT TO 30 LOT 12 — BLOCK 29 CROATAN BEACH M.B. 37 P. 11 VIRGINIA BEACH, VA. SCALE: 31 1"= 40' 8 FEBRUARY 2010 MADE FOR EDWARD F. & CHRISTEL L. LEWIS," a copy 32 of which is on file in the Department of Public Works and to which reference is made for 33 a more particular description; and 34 35 BE IT FURTHER ORDAINED, that the temporary encroachments are expressly 36 subject to those terms, conditions and criteria contained in the Agreement between the 37 City of Virginia Beach and Edward F. Lewis and Christel L. Lewis (the "Agreement"), 38 which is attached hereto and incorporated by reference; and 39 40 BE IT FURTHER ORDAINED, that the City Manager or his authorized designee 41 is hereby authorized to execute the Agreement; and 42 43 BE IT FURTHER ORDAINED, that this Ordinance shall not be in effect until such 44 time as Edward F. Lewis and Christel L. Lewis and the City Manager or his authorized 45 designee execute the Agreement. 46 47 Adopted by the Council of the City of Virginia Beach, Virginia, on the 25th day 4 8 of May , 2010. CA -11394 R-1 PREPARED: 5/5/10 APPROVED AS TO CONTENTS APPROVED AS TO LEGAL SUFFICIENCY AND FORM JBLIC WORKS, REAL ESTATE l3,aKA!IARMEYER ASSISTANT CITY ATTORNEY 11 I PREPARED BY VIRGINIA BEACH CITY ATTORNEY'S OFFICE (BOX 31) EXEMPTED FROM RECORDATION TAXES UNDER SECTION 58.1-811(C) (4) THIS AGREEMENT, made this 4th day of May, 2010, by and between the CITY OF VIRGINIA BEACH, VIRGINIA, a municipal corporation of the Commonwealth of Virginia, Grantor, "City", and EDWARD F. LEWIS AND CHRISTEL L. LEWIS, husband and wife, THEIR HEIRS, ASSIGNS AND SUCCESSORS IN TITLE, "Grantee", even though more than one. WITNESSETH: That, WHEREAS, the Grantee is the owner of that certain lot, tract, or parcel of land designated and described as "Lots 2 and 12, Block 29", as shown on that certain plat entitled: "RESUBDIVISION OF PART OF CROATAN BEACH PRINCESS ANNE CO, VA SCALE 1" = 100' JUNE, 1954," prepared by C A BAMFORTH, CLS and said plat is recorded in the Clerk's Office of the Circuit Court of the City of Virginia Beach, Virginia in Map Book 37, at page 11, and being further designated, known, and described as 522 S. Atlantic Avenue, Virginia Beach, Virginia 23451; WHEREAS, it is proposed by the Grantee to construct and maintain an elevated wood walk, steps and observation platform, collectively, the "Temporary Encroachment", in the City of Virginia Beach; WHEREAS, in constructing and maintaining the Temporary Encroachment, it is necessary that the Grantee encroach into a portion of City property located at the rear of 522 S. Atlantic Avenue known as Croatan Beach, the "Encroachment Area"; and GPIN: 2427-30-4559-0000 (522 S. Atlantic Avenue) 2427-30-8604-0000 (CITY PROPERTY) WHEREAS, the Grantee has requested that the City permit a Temporary Encroachment within the Encroachment Area. NOW, THEREFORE, for and in consideration of the premises and of the benefits accruing or to accrue to the Grantee and for the further consideration of One Dollar ($1.00), cash in hand paid to the City, receipt of which is hereby acknowledged, the City hereby grants to the Grantee permission to use the Encroachment Area for the purpose of constructing and maintaining the Temporary Encroachment. It is expressly understood and agreed that the Temporary Encroachment will be constructed and maintained in accordance with the laws of the Commonwealth of Virginia and the City of Virginia Beach, and in accordance with the City's specifications and approval and is more particularly described as follows, to wit: A Temporary Encroachment into the Encroachment Area as shown on that certain plat entitled: "PLAT SHOWING ENCROACHMENT OF ELEVATED WOOD WALK, STEPS & OBSERVATION PLATFORM ON PUBLIC BEACH ADJACENT TO LOT 12 — BLOCK 29 CROATAN BEACH M.B. 37 P. 11 VIRGINIA BEACH, VA. SCALE: 1"= 40' 8 FEBRUARY 2010 MADE FOR EDWARD F. & CHRISTEL L. LEWIS," a copy of which is attached hereto as Exhibit "A" and to which reference is made for a more particular description. Providing however, nothing herein shall prohibit the City from immediately removing, or ordering the Grantee to remove, all or any part of the Temporary Encroachment from the Encroachment Area in the event of an emergency or public necessity, and Grantee shall bear all costs and expenses of such removal. It is further expressly understood and agreed that the Temporary Encroachment herein authorized terminates upon notice by the City to the Grantee, and that within thirty (30) days after the notice is given, the Temporary Encroachment must 2 be removed from the Encroachment Area by the Grantee; and that the Grantee will bear all costs and expenses of such removal. It is further expressly understood and agreed that the Grantee shall indemnify, hold harmless and defend the City, its agents and employees, from and against all claims, damages, losses and expenses, including reasonable attorney's fees, in case it shall be necessary to file or defend an action arising out of the construction, location, or existence of the Temporary Encroachment. It is further expressly understood and agreed that nothing herein contained shall be construed to enlarge the permission and authority to permit the maintenance or construction of any encroachment other than that specified herein and to the limited extent specified herein, nor to permit the maintenance and construction of any encroachment by anyone other than the Grantee. It is further expressly understood and agreed that the Grantee agrees to maintain the Temporary Encroachment so as not to become unsightly or a hazard. It is further expressly understood and agreed that the Grantee must obtain a permit from the Department of Planning prior to commencing any construction within the Encroachment Area (the "Permit"). It is further expressly understood and agreed that the seaward extent of the Temporary Encroachment shall not extend past the eastward toe of the sand dune. It is further expressly understood and agreed that the Grantee must obtain and keep in force all-risk property insurance and general liability or such insurance as is deemed necessary by the City, and all insurance policies must name the City as additional named insured or loss payee, as applicable. The Grantee also agrees to carry comprehensive general liability insurance in an amount not less than $500,000.00, 3 combined single limits of such insurance policy or policies. The Grantee will provide endorsements providing at least thirty (30) days written notice to the City prior to the cancellation or termination of, or material change to, any of the insurance policies. The Grantee assumes all responsibilities and liabilities, vested or contingent, with relation to the construction, location, and/or existence of the Temporary Encroachment. It is further expressly understood and agreed that the Temporary Encroachment must conform to the minimum setback requirements, as established by the City. It is further expressly understood and agreed that the Grantee must submit for review and approval, a survey of the Encroachment Area, certified by a registered professional engineer or a licensed land surveyor, and/or "as built" plans of the Temporary Encroachment sealed by a registered professional engineer, if required by either the City Engineer's Office or the Engineering Division of the Public Utilities Department. It is further expressly understood and agreed that the City, upon revocation of such authority and permission so granted, may remove the Temporary Encroachment and charge the cost thereof to the Grantee, and collect the cost in any manner provided by law for the collection of local or state taxes; may require the Grantee to remove the Temporary Encroachment; and pending such removal, the City may charge the Grantee for the use of the Encroachment Area, the equivalent of what would be the real property tax upon the land so occupied if it were owned by the Grantee; and if such removal shall not be made within the time ordered hereinabove by this Agreement, the City may impose a penalty in the sum of One Hundred Dollars ($100.00) per day for each and every day that the Temporary Encroachment is allowed 4 to continue thereafter, and may collect such compensation and penalties in any manner provided by law for the collection of local or state taxes. IN WITNESS WHEREOF, Edward F. Lewis and Christel L. Lewis, the said Grantee, have caused this Agreement to be executed by their signatures. Further, that the City of Virginia Beach has caused this Agreement to be executed in its names and on its behalf by its City Manager and its seal be hereunto affixed and attested by its City Clerk. (THE REMAINDER OF THIS PAGE WAS INTENTIONALLY LEFT BLANK) 5 CITY OF VIRGINIA BEACH By (SEAL) City Manager/Authorized Designee of the City Manager STATE OF VIRGINIA CITY OF VIRGINIA BEACH, to -wit: The foregoing instrument was acknowledged before me this day of , 2010, by , CITY MANAGER/AUTHORIZED DESIGNEE OF THE CITY MANAGER OF THE CITY OF VIRGINIA BEACH, VIRGINIA, on its behalf. He/She is personally known to me. (SEAL) Notary Public Notary Registration Number: My Commission Expires: (SEAL) ATTEST: City Clerk/Authorized Designee of the City Clerk STATE OF VIRGINIA CITY OF VIRGINIA BEACH, to -wit: The foregoing instrument was acknowledged before me this day of , 2010, by , CITY CLERK/AUTHORIZED DESIGNEE OF THE CITY CLERK OF THE CITY OF VIRGINIA BEACH, VIRGINIA, on its behalf. She is personally known to me. Notary Registration Number: My Commission Expires: 6 (SEAL) Notary Public Edward/F. Lewis, Owner STATE OF VIRGIN' CITY/COUNTY OF G', G,�.�,t/) , to -wit: The foregoing instrument was acknowledged before me this 'V/4/day of Intp , 2010, by Edward F. Lewis. Notary Registration Number: Z2/3,,Y My Commission Expires: /% 3 2 / - Not ry Pub (SEAL) DOLORES J. COX NOTARY PUBLIC COMMONWEALTH OF VIRGINIA NOTARY REGISTRATION NUMBER: 7213889 MY COMMISSION EXPIRES NOVEMBER 30, 2012 STATE OF VIRGINIA� CITY/COUNTY OF U.G� J44 , to -wit: The foregoing instrument was acknowledged before me this 44y) , 2010, by Christel L. Lewis. Notary Registration Number: 7,.2/3029 My Commission Expires: //- - ,200.2- 7 N/lepthl(ix day of (SEAL) DOLORES J. COX NOTARY PUBLIC COMMONWEALTH OF VIRGINIA NOTARY REGISTRATION NUMBER: 7213889 MY COMMISSION EXPIRES NOVEMBER 30, 2012 p II APPROVED AS TO CONTENTS P11)/ Rai 2171 DEPARTMENT 8 APPROVED AS TO LEGAL SUFFICIENCY AND FORM I-mrmeyer, Assistant City Attorney 0 0 I-� W O r0 Z za Q 0 cc cc O O N Z Z ATLANTIC OCEAN "CROATAN BEACH" GPIN: 2427-30-8604 SEAWARD TOE OF DUNE p) N O J CO 4.0' CREST 15.32' r\ m L N 04'14'15" W 50.00' 0 r-) N N 1- 0 M.B. 371P. N 0 J w D Z W Q U O z — J (-N < N Q (n N n" _ N O Ln 50.00' S 0414'15" E w u) in 03 0 LiJ J W W (f) a LAW I- 0 J O a3 cn 00 in M ^ O W Q OI ro Z mo(� N, O 0 Cr) N Z .a 0 Z C.7 700.00' S. ATLANTIC AVENUE (50' R/W) (CHAUTAUQUA AVE. - M _ 37 P. 11) z w Q0w = ww ±;/) CO z 00 0 00 z COcn 0 c=n Y 0- H J Q J 3 CL 0 O J W w ADJACENT TO LOT 12 — BLOCK 29 CROATAN BEACH 0 J Q > d' J a Q mo Fc to m w v ¢ Q LU b� 1 5 = o Q Q 0 v w 09-129sp sht SHEET 1 OF 2 J Q Z 0 Q w J W CC CO 0 Imo_ W Q J J _! CL J Z W O I— C!) SHEET 2 OF 2 - 43 - Item L.10. ORDINANCES/RESOLUTIONS ITEM # 59988 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to APPROPRIATE $200, 000 from the U.S. Department of Homeland Security, Federal Emergency Management Agency (FEMA), to the FY2009-10 Operating Budget of the Fire Department re deployment of VA-TF2 Team for Haiti Earthquake Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 1 AN ORDINANCE TO APPROPRIATE FUNDS FROM 2 THE U.S. DEPARTMENT OF HOMELAND SECURITY 3 TO THE FY 2009-10 OPERATING BUDGET OF THE 4 FIRE DEPARTMENT 5 6 BE IT ORDAINED BY THE COUNCIL OF THE CITY OF VIRGINIA BEACH, 7 VIRGINIA, THAT: 8 9 $200,000 from the U.S. Department of Homeland Security, Federal Emergency 10 Management Agency is hereby appropriated, with estimated federal revenues increased 11 accordingly, to the FY 2009-10 Operating Budget of the Fire Department for costs 12 related to the deployment of VA-TF2 Team for the Haiti Earthquake Adopted by the Council of the City of Virginia Beach, Virginia on the 25th day of may , 2010. Requires an affirmative vote by a majority of all of the members of City Council. Approved as to Content Management Services CA11517 R-2 May 12, 2010 Approved as to Legal Sufficiency City . r ey's Office - 44 - Item L.11. ORDINANCES/RESOLUTIONS ITEM # 59989 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to ACCEPT and APPROPRL4TE $200, 000 grarit funds from the U.S. Department of Energy, with Federal revenues increased accordingly, to the FY2009-10 Operating Budget of the Planning Department re development of an energy assurance program Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 1 AN ORDINANCE TO ACCEPT AND APPROPRIATE GRANT 2 FUNDS FROM THE U.S. DEPARTMENT OF ENERGY TO 3 THE FY2009-10 OPERATING BUDGET OF THE 4 DEPARTMENT OF PLANNING 5 6 BE IT ORDAINED BY THE COUNCIL OF THE CITY OF VIRGINIA BEACH, 7 VIRGINIA: 8 9 1. That $200,000 is hereby accepted from the United States Department of 10 Energy and appropriated, with federal revenues increased accordingly, to the FY 2009-10 11 Operating Budget of the Department of Planning for the development of an energy 12 assurance program. Adopted by the Council of the City of Virginia Beach, Virginia on the 25thday of May 2010. Requires an affirmative vote by a majority of all the members of City Council. Approved as to Content Management Services CA11519 R-1 May 12, 2010 Approved as to Legal Sufficiency ity A eiv ey's Office II i - 45 - Item L.12. ORDINANCES/RESOLUTIONS ITEM # 59990 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to APPROPRIATE $90, 000 from the Fund Balance of the Sheriff's Department Inmate Services to the FY2009-10 Operating Budget of the Sheriff's Department to support medical deputy positions Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 1 AN ORDINANCE TO APPROPRIATE FUNDS FROM 2 THE FUND BALANCE OF THE SHERIFF'S 3 DEPARTMENT INMATE SERVICES FUND TO THE 4 FY 2009-10 OPERATING BUDGET OF THE 5 SHERIFF'S DEPARTMENT 6 7 WHEREAS, the Sheriff has requested the use of Fund Balance from the Sheriff's 8 Department Inmate Services Fund to support three current Medical deputy positions 9 transferred mid -year from the Special Revenue Fund to the Inmate Services Fund; and 10 11 WHEREAS, funding is available for FY 2009-10 in the Fund Balance of the Sheriff's 12 Department Inmate Services Fund. 13 14 NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF 15 VIRGINIA BEACH, VIRGINIA: 16 17 That $90,000 is hereby appropriated from the Fund Balance of the Sheriff's 18 Department Inmate Services Fund to the FY 2009-10 Operating Budget of the Sheriff's 19 Department. Requires an affirmative vote by a majority of all of the members of City Council. Adopted by the Council of the City of Virginia Beach, Virginia on the 25th day of May , 2010. Approved as to Content Approved as to Legal Sufficiency -74 //.//4_, r6anag entServices CA11521 R-1 May 14, 2010 e City Attorney I - 46 - Item L.13. ORDINANCES/RESOLUTIONS ITEM # 59991 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to APPROPRIATE $1,266,587 of the fund balance and TRANSFER to the Agricultural Reserve Program (ARP) Special Revenue Fund to cover the costs for the purchase of various agricultural land preservation easements Voting: 10-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, Harry E. Diezel, Robert M. Dyer, Barbara M Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Abstaining: William R. "Bill" DeSteph, Council Members Absent: None 1 II May 25, 2010 1 AN ORDINANCE TO APPROPRIATE FUND 2 BALANCE AND TRANSFER FUNDS TO THE 3 AGRICULTURAL RESERVE PROGRAM SPECIAL 4 REVENUE FUND 5 6 BE IT ORDAINED BY THE COUNCIL OF THE CITY OF VIRGINIA BEACH, 7 VIRGINIA: 8 9 1) That $566,447 is appropriated from fund balance of the Agricultural Reserve 10 Program Special Revenue Fund ("ARP Fund") to the ARP Fund in the 11 FY2009-10 Operating Budget to cover a portion of the costs for the purchase 12 of various agricultural land preservation easements. 13 14 2) That $700,140 is transferred from the Reserve for Future C.I.P. 15 Commitments in the ARP Fund to the ARP Fund in the FY2009-10 16 Operating Budget to cover the a portion of the costs for the purchase of 17 various agricultural land preservation easements. Adopted by the Council of the City of Virginia Beach, Virginia on the 25th day of May , 2010. Requires an affirmative vote by a majority of all of the members of City Council. Approved as to Content Approved as to Legal Sufficiency Management Services orney s Office CA11520 R-3 May 13, 2010 1 - 47 - Item L.14. ORDINANCES/RESOLUTIONS ITEM # 59992 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to TRANSFER $265,210 from the General Fund Reserve for Contingencies to the FY2009-10 Operating Budget of the Sheriff's Department re State imposed furlough and absorbing benefits Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 1 AN ORDINANCE TO TRANSFER $265,210 FROM 2 THE GENERAL FUND RESERVE FOR 3 CONTINGENCIES TO THE FY 2009-10 OPERATING 4 BUDGET OF THE SHERIFF'S DEPARTMENT 5 6 WHEREAS, the Compensation Board of Virginia has indicated that the Sheriff's 7 Department will not receive reimbursements in its FY 2009-10 Operating Budget for a 8 state imposed one -day furlough and a portion of retirement and life insurance costs. 9 10 NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF 11 VIRGINIA BEACH, VIRGINIA, THAT: 12 13 $265,210 is hereby transferred from the General Fund Reserve for 14 Contingencies to the FY 2009-10 Operating Budget of the Sheriff's Department. Adopted by the Council of the City of Virginia Beach, Virginia on the 25th day of May , 2010. Approved as to Content Approved as to Legal Sufficiency Manage ent Services City ey's Office CA11525 R-1 May 18, 2010 I -48- Item L.15. ORDINANCES/RESOLUTIONS ITEM # 59993 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to TRANSFER $52,135 from the Fire Department's Operating Budget re the purchase of replacement defibrillators Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 1 AN ORDINANCE TO TRANSFER FUNDS WITHIN 2 THE FY 2009-10 OPERATING BUDGET OF THE 3 FIRE DEPARTMENT TO PURCHASE 4 REPLACEMENT DEFIBRILLATORS 5 6 7 BE IT ORDAINED BY THE COUNCIL OF THE CITY OF VIRGINIA BEACH, 8 VIRGINIA THAT: 9 10 Funds in the amount of $52,135 are transferred within the FY 2009-10 Operating 11 Budget of the Fire Department to purchase five replacement defibrillators. Adopted by the Council of the City of Virginia Beach, Virginia on the 25th day of May , 2010. Approved as to Content Management Services CA11518 R-2 May 13, 2010 Approved as to Legal Sufficiency i A 's Office i y A 's Office I - 49 - Item M. PLANNING ITEM # 59994 1. BREATHWAITE PLACE STREET CLOSURE CONDITIONAL CHANGE OF ZONING 2. JACQUELINE B. AMATO NONCONFORMING STRUCTURE 3. CHESAPEAKE ATLANTIC, LLC MODIFICATION OF CONDITIONAL CHANGE OF ZONING (APPROVED by City Council October 24, 2006) 4. GRACE BIBLE CHURCH MODIFICATION OF CONDITIONS 1 AND 2 (approved by City Council on April 24, 2007) 5 HARVEST OUTREACH MINISTRIES, INC. MODIFICATION OF CONDITIONS 1 AND 2 (approved by City Council on March 25, 2008) 6. VIRGINIA BEACH UNITED METHODIST CHURCH CONDITIONAL USE PERMIT 7. T -MOBILE NORTH EAST, l.l. C/ EDISON CONDITIONAL USE PERMIT LANE STORAGE ASSOCIATES, LLC 8. CITY OF VIRGINIA BEACH CONDITIONAL USE PERMIT 9. ORDINANCES TO AMEND THE CITY ZONING a. Sections 111, 215, and 216 to ADD ORDINANCE (CZO) Section 218 defining electronic display billboards and ESTABLISH a fee in the amount of Four Hundred Dollars ($400.00) for electronic display billboard applications as authorized by Virginia Code Section 15.2-2286 (A)(6) b. Section 501 to allow cemeteries, columbariums, crematoriums and mausoleums as Conditional Uses in the R-20, R-30 and R-40 Residential Zoning Districts May 25, 2010 I - 50 - Item M. PLANNING ITEM # 59995 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council APPROVED IN ONE MOTION Items la (Plat and Ordinance corrected), 2, 3(Referred back to Planning Commission), 4, 6, 7, 8 and 9b of the PLANNING BY CONSENT AGENDA: Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent.- None bsent. None Vice Mayor Jones DISCLOSED Pursuant to Section 2.2-3115(G), Code of Virginia re City Council's discussion and vote on Section 501 of the City Zoning Ordinance to allow cemeteries, columbariums, crematoriums and mausoleums as Conditional Uses in the R-20, R-30 and R-40 Residential Districts (Item 9b). Vice Mayor Jones is a member of the funeral business, and has an ownership interest in both Tidewater Cemetery Corporation and Holloman -Brown Funeral Home, Inc. His ownership interest in both corporations exceeds 3% of the total equity in each corporation. He is a member of a business or profession (the funeral business) and a group (persons with an ownership interest in the funeral business) the members of which are affected by City Council 's consideration of this application. Although he is able to participate fairly, objectively and in the public interest, Vice Mayor Jones wishes to ABSTAIN. Vice Mayor Jones ' correspondence of May 24, 2010, is hereby made a part of the record. May 25, 2010 I - 51 - Item M.1. PLANNING ITEM # 59996 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT, Ordinances upon application of BREATHWAITE PLACE at 732-746 Newtown Road and 5573 Rock Creek Lane re townhouse dwellings, re a Street Closure and Conditional Change of Zoning. BAYSIDE DISTRICT 4 , KEMPSVILLE, DISTRICT 2 BE IT HEREBY ORDAINED BY THE COUNCIL OF THE CITY OF VIRGINL4 BEACH, VIRGINIA Ordinance upon application of BREATHWAITE PLACE for the discontinuance, closure and abandonment of a portion of Newtown Road, adjacent to 732 through 746 Newtown Road and 5573 Rock Creek Lane. BAYSIDE DISTRICT 4 , KEMPSVILLE, DISTRICT 2 A CORRECTED PLAT/and ORDINANCE will be made a part of these proceedings re a Street Closure: proposed multi family project, subject to: 1. The City Attorney's Office will make the final determination regarding ownership of the underlying fee. The purchase price to be paid to the City shall be determined according to the "Policy Regarding Purchase of City's Interest in Streets Pursuant to Street Closures" approved by City Council. Copies of said policy are available in the Planning Department. 2. The applicant shall resubdivide the property and vacate internal lot lines to incorporate the closed area into the adjoining parcel. The resubdivision plat must be submitted and approved for recordation prior to final street closure approval. 3. The applicant shall provide easements for any City utilities located within the right-of-way closure area subject to the approval of the Department of Public Utilities and/or Department of Public Works and the City Attorney's Office, which easements shall include a right of reasonable ingress and egress. 4. The applicant shall provide easements for any private utilities located within the right-of-way proposed for closure, subject to the approval of the appropriate private utility companies. 5. Closure of the right-of-way shall be contingent upon compliance with the above stated conditions within 365 days of approval by City Council. If the conditions noted above are not accomplished and the final plat is not approved within one (1) year (May 24, 2011) of the City Council vote to close the right-of-way, this approval shall be considered null and void. May 25, 2010 I - 52 - Item M1. PLANNING ITEM # 59996 (Continued) BE IT HEREBY ORDAINED BY THE COUNCIL OF THE CITY OF VIRGINIA BEACH VIRGINIA Ordinance upon application of BREATHWAITE PLACE, L.L.C., Change of Zoning, R-7.5 Residential District to Conditional A-24 Apartment District, 732-746 Newtown Road and 5573 Rock Creek Lane. KEMPSVILLE, DISTRICT 2 ZO5101237 The following condition shall be required: 1. An Agreement encompassing proffers shall be recorded with the Clerk of the Circuit Court and is hereby made a part of the record. This Ordinance shall be effective in accordance with Section 107 (f) of the Zoning Ordinance. Adopted by the City Council of the City of Virginia Beach, Virginia, on the Twenty-fifth of May, Two Thousand Ten Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None 1 II May 25, 2010 I 1 APPLICATION OF BREATHWAITE PLACE, L.L.C. 2 FOR THE CLOSURE OF A PORTION OF 3 NEWTOWN ROAD ADJACENT TO 732-746 4 NEWTOWN ROAD AND 5573 ROCK CREEK LANE 5 6 7 8 WHEREAS, Breathwaite Place, L.L.C. (the "Applicant") applied to the 9 Council of the City of Virginia Beach, Virginia, to have the hereinafter described right -of - 10 way discontinued, closed, and vacated; and 11 12 WHEREAS, it is the judgment of the Council that said right-of-way be 13 discontinued, closed, and vacated, subject to certain conditions having been met on or 14 before one (1) year from City Council's adoption of this Ordinance; 15 16 NOW, THEREFORE, BE IT ORDAINED by the Council of the City of 17 Virginia Beach, Virginia: 18 19 20 SECTION I 21 22 That the hereinafter described right-of-way be discontinued, closed and 23 vacated, subject to certain conditions being met on or before one (1) year from City 24 Council's adoption of this ordinance: 25 26 27 All that certain piece or parcel of land situate, lying and being 28 in the City of Virginia Beach, Virginia, designated and 29 described as "PORTION OF NEWTOWN ROAD TO BE 30 CLOSED AREA = 15,490 SF OR 0.356 AC" shown as the 31 hatched area on that certain plat entitled: "EXHIBIT A PLAT 32 SHOWING PORTION OF NEWTOWN ROAD TO BE 33 CLOSED", Scale: 1"=60', dated February 23, 2010 and 34 revised through March 18, 2010, prepared by MSA, P.C., a 35 copy of which is attached hereto as Exhibit A. 36 37 38 39 40 41 42 43 GPIN'S: 1468-42-4560-0000, 1468-42-4432-0000, 1468-42-4315-0000, 1468-42-3287- 44 0000 and 1468-42-4132-0000 1 45 SECTION II 46 47 The following conditions must be met on or before one (1) year from City 48 Council's adoption of this ordinance: 49 50 1. The City Attorney's Office will make the final determination 51 regarding ownership of the underlying fee. The purchase price to be paid to the City 52 shall be determined according to the "Policy Regarding Purchase of City's Interest in 53 Streets Pursuant to Street Closures," approved by City Council. Copies of said policy 54 are available in the Planning Department. 55 56 2. The applicant shall resubdivide the property and vacate internal lot 57 lines to incorporate the closed area into the adjoining parcel. The resubdivision plat 58 must be submitted and approved for recordation prior to final street closure approval. 59 60 3. The applicant shall provide easements for any City utilities located 61 within the right-of-way closure area subject to the approval of the Department of Public 62 Utilities and/or Department of Public Works and the City Attorney's Office, which 63 easements shall include a reasonable right of ingress and egress. 64 65 4. The applicant shall provide easements for any private utilities 66 located within the right-of-way proposed for closure, subject to the approval of the 67 appropriate private utility companies. 68 69 5. Closure of the right-of-way shall be contingent upon compliance 70 with the above stated conditions within one (1) year of approval by City Council. If all 71 conditions noted above are not in compliance and the final plat is not approved within 72 one (1) year of the City Council vote to close the street, this approval will be considered 73 null and void. 74 75 SECTION III 76 77 1. If the preceding conditions are not fulfilled on or before May 24, 78 2011, this Ordinance will be deemed null and void without further action by the City 79 Council. 80 81 2. If all conditions are met on or before May 24, 2011, the date of final 82 closure is the date the street closure ordinance is recorded by the City Attorney. 83 84 3. In the event the City of Virginia Beach has any interest in the 85 underlying fee, the City Manager or his designee is authorized to execute whatever 86 documents, if any, that may be requested to convey such interest, provided said 87 documents are approved by the City Attorney's Office. 88 2 89 SECTION IV 90 91 A certified copy of this Ordinance shall be filed in the Clerk's Office of the 92 Circuit Court of the City of Virginia Beach, Virginia, and indexed in the name of the CITY 93 OF VIRGINIA BEACH as "Grantor" and BREATHWAITE PLACE, L.L.C., as "Grantee." 94 95 Adopted by the Council of the City of Virginia Beach, Virginia, on the 96 25thday of May , 2010. THIS ORDINANCE REQUIRES AN AFFIRMATIVE VOTE OF THREE-FOURTHS OF ALL COUNCIL MEMBERS ELECTED TO COUNCIL. CA11227 R-1 May 12, 2010 APPROVED AS TO CONTENT: APPROVED AS TO LEGAL SUFFICIENCY: ut6cc4wn,4-1/ovJ- Lucia G. Whitlow, Associate City Attorney 3 NOTES: 1. THIS EXHIBIT DOES 00 NOT CONSTITUTE A 644 BOUNDARY OF LAND. 63+19.261 2. THS EXHIBIT WAS CREATED WITHOUT THE 65.96' RT BENEFIT OF A TITLE �I I REPORT. 1 3. THE PURPOSE OF THIS EXHIBIT IS TO CLOSE A PORTION OF NEWTOWN ROAD AND TO ACCOMPANY THE DEED. 63 --\:Dc3?<\ to r- 1. WOE 0,....., \. ()) 13 rri rn rn \\.0 �3z\0o 20O o� 9Q �pO tv 2 LANE LA(50 K/W/ R=871.44' (FORRMERL Y CLASSY GOODMAN ROAD) L=8.53' (MB 2416, PG 418) MB 231, PG 2) POO PIN(F) S 61'44'26" E 191.24' 132.93' IN(F) N 73'00'43" E P ,i 22.67' J CURTIS BREATHWAITE (Ni 0( r) (DB 4LOT BG 471) (MB 231, PG 2) N(F) GPIN 1468-42-4560 , 152.93 - 158.90' 0.05' RT 61 CURVE TABLE CURVE RADIUS LENGTH TANGENT C1 640.00 164.76 82.84 CHORD BEARING DELTA 164.31 N 33'24'57" E 14'45'00" DENOTES PORTION OF NEWTOWN ROAD TO BE CLOSED AREA = 15,490 SF OR 0.356 AC BASEL/NE TAKEN FROM V0.0.1: PLANS FOR NEWTOWN ROAD PHASE 1-8, SHEETS 17-20, DATED 6-07-1985 REV 2 REV 1 00 J w 0. Q L N 58'08'44" W 333.90' DEAN & MILDRED ELAINE BREATHWAITE (WB 74, PG 965) PARCEL X (MB 173, PG 32) GPIN 1468-42-4432 60-00 N 57'08'01" W 316.20' JAMES INEZ & SYLVIA A. NANCE, ET AL o(F) N(F) PARCE Y, (MB 10731727110) PC 3 ) _ GPIN 1468-42-4315 �� 4.35 N 53 3'- - --- - 0.54' RT W 298.74 0/A DWAYNE E. MUMFORD, ET AL (WB 86, PG 1669) PARCEL Z (MB 173, PG 32) GPIN 1468-42-3287 c0 0 IN (FONO 28.92' - 147.40'- S-51.28'41" E- io ,n JAMES INEZ & SYLVIA o A. NANCE, ET AL (DB 2326, PG 1017) REMAINING PART OF TRACT z 10, (MB 173, PG 32) GPIN 1468-42-4132 N 50'01'47 1� 297.79, 47.14' RT 58 0� / /// KCR KCR 3-18-2010 2-22-2010 N/F CH/NESE COMMUN/TY CULTURAL CLUB, /NC. PARCEL(08 2Ax8& PARCEL X (4,18 94, PG 29) (M8 45, PG 55) (M8 195, PG 78) GP/N 1468-42-2093 ESQUIRE 3-18-2010 CITY COMMENTS 2-19-2010 SHEET 1 OF 2 EXHIBIT A PLAT SHOWING PORTION OF NEWTOWN ROAD TO BE CLOSED VIRGINIA BEACH VIRGINIA Mil/. IMO 11001 NMI "Nv MSA, P.C. ENVIRONMENTAL SCIENCES •GEOSCIENCES PLANNING • SURVEYING •ENGINEERING •LANDSCAPE ARCHITECTURE 5033 ROUSE DRIVE, VIRGINIA BEACH, VA 23462 757-490-9264 (OFC) 757-490-0634 (FAX) www.msaonline.com PROJ. NO.: 09037 DRAWN: KCR DATE: 2-23-2010 SCALE: 1" = 60' NOTES: 1. THIS EXHIBIT DOES NOT CONSTITUTE A BOUNDARY OF LAND. 1 2. THIS EXHIBIT WAS CREATED WITHOUT THE 1 BENEFIT OF A TITLE REPORT. 3. THE PURPOSE OF THIS EXHIBIT IS TO CLOSE A PORTION OF NEWTOWN ROA AND TO ACCOMPANY THE DEED. MH 8' - 10" l'V� W ----SS— STMH 15"RCP D/ ROCK GWS LANE (50' R/W) (FORMERLY (A18416, PGSSY 418) (M9 231, PGA 2)) (Ma TEL PED D 2-55 VALVE (HRSD CB I CONC CARPORT PLAN VIEW SHOWING TOPOGRAPHIC FEATURES ALONG PORTION OF NEWTOWN ROAD TO BE CLOSED Yz STAN DENOTES PORTION OF NEWTOWN ROAD TO BE CLOSED AREA = 15,490 SF OR 0.356 AC FRAME SHED. ❑ 1 -STY BRK & FR GARAGE 1 -STY BR/CK /742 SCO SMH CATV PEO TEL PEP FH' TEL BOX CABLE BOX GRA VEL _ PP FRAME SHED FIBER OPT/CS W/TNESS POST l// I PP REV 2 KCR 3-18-2010 ESQUIRE 3-18-2010 REV 1 KCR 2-22-2010 CITY COMMENTS 2-19-2010 SHEET 2 OF 2 EXHIBIT A PLAT SHOWING PORTION OF NEWTOWN ROAD TO BE CLOSED VIRGINIA BEACH VIRGINIA MSA. P.C. ENVIRONMENTAL SCIENCES •GEOSCIENCES PLANNING • SURVEYING *ENGINEERING ` • LANDSCAPE ARCHITECTURE 5033 ROUSE DRIVE, VIRGINIA BEACH, VA 23462 757-490-9264 (OFC) 757-490-0634 (FAX) www.msaonline.com PROJ. NO.: 09037 DRAWN: KCR DATE: 2-23-2010 SCALE: 1" = 60' In Reply Refer To Our File No. DF -7579 CITY OF VIRGINIA BEACH INTER -OFFICE CORRESPONDENCE DATE: May 13, 2010 TO: Mark D. Stiles DEPT: City Attorney FROM: B. Kay Wilson DEPT: City Attorney RE: Conditional Zoning Application; Breathwaite Place, L.L.C. The above -referenced conditional zoning application is scheduled to be heard by the City Council on May 25, 2010. I have reviewed the subject proffer agreement, dated July 31, 2009 and have determined it to be legally sufficient and in proper legal form. A copy of the agreement is attached. Please feel free to call me if you have any questions or wish to discuss this matter further. BKW/ka Enclosure cc: Kathleen Hassen PREPARED BY: EU SYKES. POURDON. GO AERN & LEVY. P.C. BREATHWAITE PLACE, L.L.C., a Virginia limited liability company CURTIS BREATHWAITE MILDRED ELAINE BREATHWAITE DEANS INEZ JAMES, SYLVIA A. NANCE, BETTY JEAN GADSON and LINDA VERNON PATRICIA E. WILLIAMS, DWAYNE E. MUMFORD, LILLIAN M. HELM a/k/a LILLIAN M. MELVIN, JUDY M. RAINEY and KAREN D. MUMFORD AARON L. RAINEY and BEVERLY B. RAINEY, husband and wife TO (PROFFERED COVENANTS, RESTRICTIONS AND CONDITIONS) CITY OF VIRGINIA BEACH, a municipal corporation of the Commonwealth of Virginia THIS AGREEMENT, made this 3ist day of July, 2009, by and between BREATHWAITE PLACE, L.L.C., a Virginia limited liability company, Grantor, party of the first part; CURTIS BREATHWAITE, Grantor, party of the second part; MILDRED ELAINE BREATHWAITE DEANS, Grantor, party of the third part; INEZ JAMES, SYLVIA A. NANCE, BETTY JEAN GADSON and LINDA VERNON, Grantors, parties of the fourth part; PATRICIA E. WILLIAMS, DWAYNE E. MUMFORD, LILLIAN M. HELM a/k/a LILLIAN M. MELVIN, JUDY M. RAINEY and KAREN D. MUMFORD, Grantors, parties of the fifth part; AARON L. RAINEY and BEVERLY B. RAINEY, husband and wife, parties of the sixth part; and THE CITY OF VIRGINIA BEACH, a municipal corporation of the Commonwealth of Virginia, Grantee, party of the seventh part. WITNESSETH: WHEREAS, the party of the second part is the owner of a certain parcel of property located in the Kempsville District of the City of Virginia Beach, Virginia, containing approximately 16,680 square feet designated as Parcel One in Exhibit "A" attached hereto and incorporated herein by this reference. Parcel One, along with the other pieces and parcels described herein and in Exhibit "A" are hereinafter collectively referred to as the "Property"; and GPIN: 1468-42-4560 1468-42-4432 1468-42-4315 1468-42-3287 1468-42-4132 1468-42-6125 1 PREPARED BY: 013 SYK£S. BOURDON. NM AHI£RN & LEVY. P.C. WHEREAS, the party of the third part is the owner of a certain parcel of property located in the Kempsville District of the City of Virginia Beach, Virginia, containing approximately 0.522 acres designated as Parcel Two in Exhibit "A" attached hereto and incorporated herein by this reference. Parcel Two, along with the other pieces and parcels described herein and in Exhibit "A" are hereinafter collectively referred to as the "Property"; and WHEREAS, the parties of the fourth part are the owners of a certain parcel of property located in the Kempsville District of the City of Virginia Beach, Virginia, containing approximately 0.482 acres designated as Parcel Three in Exhibit "A" attached hereto and incorporated herein by this reference. Parcel Three, along with the other pieces and parcels described herein and in Exhibit "A" are hereinafter collectively referred to as the "Property"; and WHEREAS, the parties of the fifth part are the owners of a certain parcel of property located in the Kempsville District of the City of Virginia Beach, Virginia, containing approximately 0.642 acres designated as Parcel Four in Exhibit "A" attached hereto and incorporated herein by this reference. Parcel Four, along with.the other pieces and parcels described herein and in Exhibit "A" are hereinafter collectively referred to as the "Property"; and WHEREAS, the parties of the fourth part and the parties of the fifth part, together are the owners of a certain parcel of property located in the Kempsville District of the City of Virginia Beach, Virginia, containing approximately 1.615 acres designated as Parcel Five in Exhibit "A" attached hereto and incorporated herein by this reference. Parcel Five, along with the other pieces and parcels described herein and in Exhibit "A" are hereinafter collectively referred to as the "Property"; and WHEREAS, the parties of the sixth part are the owners of a certain parcel of property located in the Kempsville District of the City of Virginia Beach, Virginia, containing approximately 0.46 acres designated as Parcel Six in Exhibit "A" attached hereto and incorporated herein by this reference. Parcel Six, along with the other pieces and parcels described herein in Exhibit "A" are hereinafter collectively referred to as the "Property"; and WHEREAS, the party of the first part is the contract purchaser of the assembled property containing approximately 3.8 acres and has initiated a conditional amendment to the Zoning Map of the City of Virginia Beach, Virginia, by petition addressed to the Grantee 2 PREPARED BY: affl SYKES. POURDON. WM AHERN & LEVY. P.C. so as to change the Zoning Classification of the Property from R-7.5 Residential District to Conditional A-18 Apartment District; and WHEREAS, the Grantee's policy is to provide only for the orderly development of land for various purposes through zoning and other land development legislation; and WHEREAS, the party of the first part acknowledges that the competing and sometimes incompatible uses conflict and that in order to permit differing uses on and in the area of the Property and at the same time to recognize the effects of change, and the need for various types of uses, certain reasonable conditions governing the use of the Property for the protection of the community that are not generally applicable to land similarly zoned are needed to cope with the situation to which the Grantor's rezoning application gives rise; and WHEREAS, the party of the first part has voluntarily proffered, in writing, in advance of and prior to the public hearing before the Grantee, as a part of the proposed amendment to the Zoning Map, in addition to the regulations provided for the A-18 Zoning District by the existing overall Zoning Ordinance, the following reasonable conditions related to the physical development, operation, and use of the Property to be adopted as a part of said amendment to the Zoning Map relative and applicable to the Property, which has a reasonable relation to the rezoning and the need for which is generated by the rezoning. NOW, THEREFORE, the party of the first part, for itself, its successors, personal representatives, assigns, grantee, and other successors in title or interest, voluntarily and without any requirement by or exaction from the Grantee or its governing body and without any element of compulsion or quid pro quo for zoning, rezoning, site plan, building permit, or subdivision approval, hereby make the following declaration of conditions and restrictions which shall restrict and govern the physical development, operation, and use of the Property and hereby covenant and agree that this declaration shall constitute covenants running with the Property, which shall be binding upon the Property and upon all parties and persons claiming under or through the Grantor, its successors, personal representatives, assigns, grantee, and other successors in interest or title: 1. When the Property is developed, it shall be as a residential condominium, substantially in accordance with the "CONCEPTUAL S1'l'E LAYOUT OF BREATHWAITE PLACE NEWTOWN ROAD & ROCK CREEK LANE VIRGINIA BEACH, VA", dated 07/10/09, prepared by MSA, P.C., which has been exhibited to the Virginia Beach City Council and is on file with the Virginia Beach Department of Planning (the "Concept Plan"). 3 PREPARED BY: am SYKES. BOURDON. �. AHfRN & L£vY. P.0 2. When the Property is developed, it will be landscaped substantially as depicted and described on the Concept Plan, with vehicular Ingress and Egress limited to one (i) entrance from Newtown Road as depicted on the Concept Plan. 3. The total number of dwelling units permitted to be constructed on the Property shall not exceed forty-five (45). Each dwelling unit shall contain a minimum of 1400 square feet of living area, and a one (1) car garage. 4. The architectural design and exterior building materials of the residential buildings will be substantially as depicted and described on the Concept Plan. 5. Further conditions may be required by the Grantee during detailed Site Plan review and administration of applicable City Codes by all cognizant City agencies and departments to meet all applicable City Code requirements. The above conditions, having been proffered by the Grantor and allowed and accepted by the Grantee as part of the amendment to the Zoning Ordinance, shall continue in full force and effect until a subsequent amendment changes the zoning of the Property and specifically repeals such conditions. Such conditions shall continue despite a subsequent amendment to the Zoning Ordinance even if the subsequent amendment is part of a comprehensive implementation of a new or substantially revised Zoning Ordinance until specifically repealed. The conditions, however, may be repealed, amended, or varied by written instrument recorded in the Clerk's Office of the Circuit Court of the City of Virginia Beach, Virginia, and executed by the record owner of the Property at the time of recordation of such instrument, provided that said instrument is consented to by the Grantee in writing as evidenced by a certified copy of an ordinance or a resolution adopted by the governing body of the Grantee, after a public hearing before the Grantee which was advertised pursuant to the provisions of Section 15.2-2204 of the Code of Virginia, 1950, as amended. Said ordinance or resolution shall be recorded along with said instrument as conclusive evidence of such consent, and if not so recorded, said instrument shall be void. The Grantor covenants and agrees that: (1) The Zoning Administrator of the City of Virginia Beach, Virginia, shall be vested with all necessary authority, on behalf of the governing body of the City of Virginia Beach, Virginia, to administer and enforce the foregoing conditions and restrictions, including the authority (a) to order, in writing, that any noncompliance with such conditions be remedied; and (b) to bring legal action or suit to insure compliance with such conditions, 4 including mandatory or prohibitory injunction, abatement, damages, or other appropriate action, suit, or proceeding; (2) The failure to meet all conditions and restrictions shall constitute cause to deny the issuance of any of the required building or occupancy permits As may be appropriate; (3) If aggrieved by any decision of the Zoning Administrator, made pursuant to these provisions, the Grantor shall petition the governing body for the review thereof prior to instituting proceedings in court; and (4) The Zoning Map may show by an appropriate symbol on the map the existence of conditions attaching to the zoning of the Property, and the ordinances and the conditions inay be made readily available and accessible for public inspection in the office of the Zoning Administrator and in the Planning Department, and they shall be recorded in the Clerk's Office of the Circuit Court of the City of Virginia Beach, Virginia, and indexed in the name of the Grantor and the Grantee. PREPARED BY: Q SYKES. BOURDON. MI AIIERN & LEVY. P.C. WITNESS the following signature and seal: Grantor: Breathwaite Place, L.L.C., a Virginia limited liability compn By: Francis H. Cohan, Managing Member (SEAL) STATE OF VIRGINIA CITY OF VIRGINIA BEACH, to -wit: The foregoing instrument was acknowledged before me this day of August, 2009, by Francis H. Cohan, Managing Member of Breathwaite Place, L.L.C., a Virginia limited liability company, Grantor. A66.4. (1V-e-MAIY(itr My Commission Expires: " 3 / — 7—f /--3 Notary Registration No.: J G /a2 07 7 PREPARED BY: ©: SYK£S. POUPDON. Rai 4IIERN & LEVY. P.0 Notary Public''"""'ss• `‘‘\).' : ,r3 :101A TARY„ PUBLIC •';L REG #361227 ; 2 n 1W COMMISSION : g EXPIRES 05/31/13 -11,-044:7 ........ 1 WITNESS the following signature and seal: Grantor: f' 1 Curtis Breathwaite I STATE OF 1 i if d /1( l CITY/COUNTY OE/ //it ; / G;, /51 ' (.i , to -wit: The foregoing instrument was acknowledged before me this 2009, by Curtis Breathwaite, Grantor. .-, My Commission Expiresi,L/, Notary Registration No.: 0,7 PREPARED BY: OM SYKES. ROURDON. En AIHERN & LEVY. P.0 /�i (SEAL) day of August, Notary Public r, ai// PREPARED BY: ME SYYES. $OUPDON, ARUN & LEVY. P C WITNESS the following signature and seal: Grantor: Mildred Elaine Breathwaite Deans STATE OF ‘.) 0,� v .- CITY/COUNTY OF PtcLA.i ` Yl. Cv(:4 , to -wit: The foregoing instrument was acknowledged before me this (e day of August, 2009, by Mildred Elaine Breathwaite Deans, Grantor. W Notarv' Public My Commission Expires: `�� J 1 Z t I l Notary Registration No.: 6-014, 8 WITNESS the following signature and seal: STATE OF lith CITY/COUNTY , to -wit: The foregoing instrument was acknowledged before me this 2009, by Inez James, Grantor. My Commission Expires: Notary Registration No.: '/ 91/7 g a 1 Ak" (SEAL) day of August, Notary Public e ,9a1� _1/ PZS G . •=1,,,--4788 171 =2 tM� O1M!SSON iz' '.. EA, r -"S 0'....9!..3.3..2.C..4_..1--...,4:000 111111141111000 PREPARED BY: 013 SYICES, DOURDON. FABI AIIERN & LEVY. P.C. faer.••""'OZ10£16' SMdidX3 ANOlSSIWW03 AW : :• 88LP64131d • wend �I ••••••••••• qpoin 14_70 „��nm1n11 4 I WITNESS the following signature and seal: Grantor: STATE OF Z'u (D CITY/COUNTY OF (J 6,, (" x LAS The foregoing instrument was acknowledged before me this 2009,by Sylvi Nance, Grantor. t Y ; . i. My 'Commission Expires: Notary Registration No.: PREPARED BY: SYk£S. IOURDON. AII£RN & LEVY. P.C. 10 gaiii/t/t( Public Public (SEAL) day of August, WITNESS the following signature and seal: , to -wit: The foregoing instrument was acknowledged before me this 2o.Qg._b (/ day of August, My Commission Expires: I:3 r ZS/ Notary Registration No.: j 7) 7. 7 PREPARED BY: M3 SYK£S. BOURDON. AII£RN & LEVY. P.C. Notary Public WITNESS the following signature and seal: STATE OF f7,0 CITY/COUNTY OF (2/%47yf Linda Vernon �,✓ , to -wit: The foregoing instrument was acknowledged day me this l of August, 2009, by Linda Vernon. ,. ?._ • WAYNE C. MARTIN Now,P G • WM d NNWt.t , ▪ MyComilasE4lnsJw31.2O12Y._. - • 00 754342 84:64 eordsdikau.NNWAINNNANs. My Commission Expires: i iz Notary Public Notary Registration No.: ..D 76--iL 3(c z PREPARED BY: 03 SYK£S. 1OURDON, UM A1-1£RN & LEVY. P.0 WITNESS the following signature and seal: STATE OF CITY/COUNTY OF L/ ,.< < . `. c , to -wit: Grantor: t�P l4 ; Patrici�,E.Williams (SEAL) DEBOIRAN FORD NOTARYPUBUC COMMONWEALTH OF VIRGINIA MY COMMISSION EXPIRES JULY 31.20' COMMISSION , 7106705 The foregoing instrument was acknowledged before me this S/ day of August, 2009, by Patricia,E: Williams, Grantor. My Commission Expires: Notary Registration No.: i /1.)--)C-5.- h PREPARED BY: gn SYKES. POURDON. en AIIERN & LEVY. P.0 nT..ron, Public Notary Public PREPARED BY: WI SYKES. R0URD0N. MB AHERN & LEVY. P.C. WITNESS the following signature and seal: STATE OF Vi/b- (SEAL) CITY/COUNTY OFA Val 1,11.-Oci ?'G ' , to -wit: The foregoing instrument was acknowledged before me this /17 day of August, 2009, by Dwayne E. Mumford, Grantor. My Commission Expires: 1/0c`� 1 2'' Notary Registration No.: r1 4 O -f LJ. 1ca=riarkisto ID; an TIMMIANCIONY MOON Nagy MO CommirmelPt nhiip Notary Pa lic WITNESS the following signature and seal: Grantor: I.rlhan M. Helm alk/a Lillian M. Melvin STATE OF Z\ ti`11 �%- CITY/COUNTY OFA Ct__ �'.1' �C>� )c= Cti: \c- . , to -wit: The foregoing instrument was acknowledged before me this 2009, by Lillian M. Helm a/k/a Lillian M. Melvin, Grantor. rr -- r t \ Notary Public My Commission Expires: (-2 - 3 Notary Registration No.: 1 a `1 37 11 PREPARED BY: gin SYKES. BOURDON. IWO AHERN & LEVY. P.0 )+ (SEAL) ay of August, I WITNESS the following signature and seal: STATE OF "' 0"\i CITY/COUNTY OF -\ Grantor: Jay M. Rainey kVA V CS , to -wit: (SEAL) The foregoing instrument was acknowledged before me this '..`:::qdayof August, 2009, by Judy M. Rainey, Grantor. My Commission Expires: Notary Registration No.: PREPARED BY: Q SYKES. BOURDON. 12111 AIIRRN & LEVY. P.0 WITNESS the following signature and seal: Grantor: �Ze,c•� `ll (co,Aal cJ (SEAL) Karen D. Mumfor x t STATE OF Ji %YCLGL) CITY/COUNTY OF (,+L'L(6,i f ,44 tat , to -wit: The foregoing instrument was acknowledged before me this /'7 day of August, 2009, by Karen D. Mumford, Grantor. My Commission Expires: Notary Registration No.: q/.3a l/� PREPARED BY: SYUES. POURDON. Oil ANERN & LEVY. P.C. WITNESS the following signatures and seals: STATE OF VIRGINIA CITY/COUNTY OF Grantors: Aaron L. Rainey (SEAL) 12,144z/ibtaql (S ) Beverly B. Rainey eAto, El otCV , to -wit: The foregoing instrument was acknowledged before me this zly//0 day of February, 2010, by Aaron L. Rainey and Beverly B. Rainey, husband and wife, Grantors. 3p1j3 (a[\ -n Lrr,CsAdan otary Public My Commission Expires: 9Man _fi t ,20 1 Z Notary Registration No.: '7x53 (51 `��,1►lllli//44 \\\\ 014 MCC& �� Q: oo�OTAAyg:9y } r. 2 �•� 0'�- _ cl . i(/BLVA 10 tiN. tin A 111110�� REGISTRATION NO. 7053151 18 I PREPARED BY: RIB SYKES. ROURDON. Mil AtI£RN & LEVY. P.C. EXHIBIT "A" LEGAL DESCRIPTION Parcel One: All that certain lot, piece or parcel of land, together with the buildings and improvements thereon, and the appurtenances thereunto belonging, lying, situate and being in the Bayside Borough of the City of Virginia Beach, Virginia, and being known, numbered and designated as Lot B, as shown on that certain plat entitled, "Subdivision of The Remainder of Property As Shown on that certain plat entitled `Property of Curtis Breathwaite Located Near Davis Corner" and recorded in Deed Book 444, at Page 473, Bayside Borough, Virginia Beach, Virginia for Curtis W. Breathwaite"', which said plat is duly recorded in the Clerk's Office of the Circuit Court of the City of Virginia Beach, Virginia, in Map Book 231, at Page 2; to which reference is hereby made for a more particular description. GPIN: 1468-42-4560 Parcel Two: All that certain lot, piece or parcel of land, together with the buildings and improvements thereon, and the appurtenances thereunto belonging, lying, situate and being in the Bayside Borough of the City of Virginia Beach, Virginia, and being known, numbered and designated as "Bruce Breathwaite" 0.522 Acres, as shown on that certain plat entitled, "Resubdivision of Property of Anthony R. Braithwaite Estate WB 58 p 115 ` Newsome Farm' Bayside Borough Virginia Beach, Virginia", which said plat is duly recorded in the Clerk's Office of the Circuit Court of the City of Virginia Beach, Virginia, in Map Book 173, at Page 32; to which reference is hereby made for a more particular description. GPIN: 1468-42-4432 Parcel Three: All that certain lot, piece or parcel of land, lying, situate and being in the Bayside District of the City of Virginia Beach, Virginia, being bounded and described as follows: Beginning at a 5 inch pipe in the northern side of Bayside Road to Davis Corner and running thence along the property of A. Breathwaite, North 63° 35" East 211.4 feet to a pin; thence South 18° 56" East 71.8 feet to a pin; thence South 67° West 195.1 feet to a 5 inch pin in the northern side of said road; thence 59.7 feet to the point of beginning, containing .32 acres more or less; and All that certain parcel of land, situate, lying and being in the City of Virginia Beach, Virginia, and being more particularly described as "Parcel 'Y' 0.170 Ac Parcel to be Conveyed to Peele" on that certain plat entitled "Resubdivision of Property of Anthony R. Breathwaite Estate, PREPARED BY: an SYKES. BOURDON. • AHIERN & LEVY. P.C. `Newsome's Farm', Bayside Borough, Virginia Beach, Virginia, Scale 1"=50', dated September 3, 1983", which plat was made by Gallup Surveyors & Engineers, Ltd., and which plat is duly recorded in the Clerk's Office of the Circuit Court of the City of Virginia Beach, Virginia, in Deed Book 173, at Page 32. GPIN: 1468-42-4315 Parcel Four: All that certain lot, piece or parcel of land, located in the Bayside District of the City of Virginia Beach, Virginia, and being described as follows: Beginning at a point on the East side of Bayside Road at a pin in the dividing line between the property now or formerly belonging to Ruth Bailey and the property hereby conveyed; thence North 67° 00' East 5 feet to a pin; thence North 67° 00' East 195.1 feet to a pin; thence South 18° 56" East 102 feet to a pin; thence South 69° 23' West 177.2 feet to a pin; thence in the same course 5 feet to a pin on the East side of Bayside Road; thence North 29° 40' West along the East side of Bayside Road 94.9 feet to the point of beginning; a plat of which property is recorded in the Clerk's Office of the Circuit Court of the City of Virginia Beach, Virginia, in Deed 360, at Page 471. GPIN: 1468-42-3287 Parcel Five: ALL THAT certain parcel of land situate, lying and being in the City of Virginia Beach, Virginia, and being more particularly designated as "Remains of Anthony R. Breathwaite Estate" on that certain plat entitled "Resubdivision of Property of Anthony R. Breathwaite Estate, `Newsome's Farm', Bayside Borough, Virginia Beach, Virginia, Scale 1"=50', dated September 3, 1983", which said plat was made by Gallup Surveyors & Engineers, Ltd., and which said plat is duly recorded in the Clerk's Office of the Circuit Court of the City of Virginia Beach, Virginia, in Deed Book 173, at Page 32, reference to said plat being hereby made for a more particular description and location of the aforementioned property. GPIN: 1468-42-4132 Parcel Six: ALL THAT certain parcel of land situate, lying and being in the City of Virginia Beach, Virginia, being a portion of Lot D as depicted on the Plat of Newsome Farm as recorded in the Office of the Clerk of the Circuit Court of the City of Virginia Beach, Virginia, in Map Book 62, at Page 1, which parcel is more particularly described as follows: 20 Beginning at a pin found located at the southeast corner of "PARCEL 2" (GPIN 1468-42- 3287) as depicted by plat recorded in Map Book 173, at Page 32 which pin is also located at the southwest corner of Lot D (GPIN 1468-42-6125) as depicted on the Plat of Newsome Farm (M.B. 62, Pg 1) and from said Point of Beginning running along the boundary line between the two aforementioned properties North 40° 20' 59" East, a distance of 127.47 feet to a point; thence turning and departing from said boundary line South 58° 22' 14" East, a distance of 165.07 feet to a point on the western boundary of the Subdivision of Bayside Place as recorded in the afore referenced Clerk's Office as Instrument #200312180211118; thence along said boundary line South 42° 45' 25" West, a distance of 128.41 feet to a point; thence turning and departing said boundary line and running along the shared boundary line with "The Remaining Part of Lot 10 (GPIN 1468-42-4132) as depicted by Plat recorded in Map Book 173, at Page 32, North 58° 22' 14" West, a distance of 159.62 feet to the pin at the Point of Beginning and containing 20,455 square feet or 0.47 acres. GPIN: 1468-42-6125 ConditionalRezoning/BreathwaitePlace/Proffer4_Clean Rev_2/u/io PREPARED BY: an SYKES. BOURDON. A}[ERN & LEVY. P.0 - 53 - Item M.2. PLANNING ITEM # 59997 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT, the application of JACQUELINE B. AMATO to enlarge a Nonconforming Structure at 5306 Atlantic Avenue: Resolution authorizing the enlargement of a nonconforming use on property located at 5306 Atlantic Avenue owned by JACQUELINE B. AMATO, GPIN # 24188918700000 LYNNHA VEN - DISTRICT 5 The following conditions shall be required: 1. The alterations shall substantially adhere to the submitted site plan entitled "Non — Conforming Use Exhibit for Amato Residence #5306 Atlantic Avenue " prepared by WPL and dated March 31, 2010. Said plan has been exhibited to the City of Virginia Beach City Council and is on file in the Planning Department. 2. The proposed alterations shall substantially adhere to the submitted elevations entitled "Proposed Renovations and Addition to: Amato Residence, 5306 Atlantic Avenue, Virginia Beach, VA" prepared by Bizport dated November 30, 2009, and last revised May 4, 2010. Said elevations have been exhibited to the City of Virginia Beach City Council and are on file in the Planning Department. 3. All required permits for the proposed additions and alterations shall be obtained from the Planning Department/Permits and Inspections Division. Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer, Barbara M Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 1 A RESOLUTION AUTHORIZING THE 2 ENLARGEMENT OF A NONCONFORMING 3 USE ON PROPERTY LOCATED AT 5306 4 ATLANTIC AVENUE OWNED BY 5 JACQUELINE B. AMATO 6 7 WHEREAS, Jacqueline B. Amato, (hereinafter the "Applicant") has made 8 application to the City Council for authorization to enlarge a nonconforming use having 9 the address of 5306 Atlantic Avenue, in the R-5R Resort Residential District, by 10 enlarging one of the two dwellings located on the parcel; and 11 12 WHEREAS, the two dwellings are nonconforming as they are located on the 13 same parcel, which is not allowed in the R-5R Zoning District; and 14 15 WHEREAS, the dwellings were erected prior to the adoption of the applicable 16 regulations; and 17 18 WHEREAS, pursuant to Section 105 of the City Zoning Ordinance, the 19 enlargement of a nonconforming use is unlawful in the absence of a resolution of the 20 City Council authorizing such action upon a finding that the proposed use, as enlarged, 21 will be equally appropriate or more appropriate to the zoning district than is the existing 22 use; 23 24 NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF 25 VIRGINIA BEACH, VIRGINIA: 26 27 That the City Council hereby finds that the proposed use, as enlarged, will be 28 equally appropriate to the district as is the existing use under the conditions of approval 29 set forth hereinbelow. 30 31 BE IT FURTHER RESOLVED BY THE COUNCIL OF THE CITY OF VIRGINIA 32 BEACH, VIRGINIA: 33 34 That the enlargement of the nonconforming use is hereby authorized, upon the 35 following conditions: 36 37 1. The alterations shall substantially adhere to the submitted site plan entitled, 38 "Non-Conforming Use Exhibit for Amato Residence #5306 Atlantic Avenue", 39 prepared by WPL and dated March 31, 2010. Said plan has been exhibited 40 to the City of Virginia Beach City Council and is on file in the Planning 41 Department. 42 43 2. The proposed alterations shall substantially adhere to the submitted 44 elevations entitled, "Proposed Renovations & Addition to: Amato Residence; 45 5306 Atlantic Avenue, Virginia Beach, VA", prepared by Bizport, dated 46 November 30, 2009, and last revised May 4, 2010. Said elevations have 47 been exhibited to the City of Virginia Beach City Council and are on file in the 48 Planning Department. 49 50 3. All required permits for the proposed additions and alterations shall be 51 obtained from the Planning Department/Permits and Inspections Division. 52 53 54 Adopted by the Council of the City of Virginia Beach, Virginia, on the 2gi-h day 55 of May , 2010. APPROVED AS TO CONTENT: CA11516 R-1 May 11, 2010 APPROVED AS TO LEGAL SUFFICIENCY: VU_ City Attorney's Office Map L-4 Map Not to Scale Jacqueline B. Amato Non Conforming Use I - 54 - Item M.3. PLANNING ITEM # 59998 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council REFERRED BACK TO THE PLANNING COMMISSION, BY CONSENT, Ordinance upon application of CHESAPEAKE ATLANTIC, LLC for Modification of Conditional Change of Zoning (approved by City Council on October 24, 2006) at 173 and 177 South Birdneck Road and 1228 Jenson Drive. BEACH — DISTRICT 6 The applicant has requested change in building elevations. Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 - 55 - Item M.4. PLANNING ITEM # 59999 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT an Ordinance upon application of GRACE BIBLE CHURCH for Modification of Conditions 1 and 2 (approved by City Council on April 24, 2007) at Ansol Lane, BE IT HEREBY ORDAINED BY THE COUNCIL OF THE CITY OF VIRGINIA BEACH, VIRGINIA Ordinance upon application GRACE BIBLE CHURCH for Modification of Conditions 1 and 2 (approved by City Council on April 24, 2007) at Ansol Lane (GPINs 14971388860000; 14971358620000) ROSE HALL — DISTRICT 3 The following conditions shall be required: 1. All conditions, with the exception of Number 1 and Number 2 attached to the Conditional Use Permit granted by the City Council on April 24, 2007, remain in effect. 2. Condition Number 1 of the April 24, 2007, Conditional Use Permit is deleted and replaced with the following: When the site is developed, it shall be developed in substantial conformance with the plan entitled "Grace Bible Church, Ansol Lane, West of Landmark Square " prepared by Martin Engineering and dated March 26, 2010. 3. Condition Number 2 of the April 24, 2007 Conditional Use Permit is deleted and replaced with the following: The church building shall be constructed in substantial conformance with the elevation entitled "New Facility for Grace Bible Church, Virginia Beach, Virginia", prepared by Covington Hendrix Anderson Architects and dated March 23, 2010. Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 1 - 56 - Item M.S. PLANNING ITEM # 60000 Charles Bowdoin, 3313 North Landing, Phone: 407-0560, represented himself and the Lonegrans, stating opposition re the LED signage and if it is utilized same would be turned off after the services. Mr. Bowdoin and some neighbors also objected to the turn lanes. One of the original problems was the back up of traffic on Indian River Road. The residents were also concerned re the stormwater runoff. When the entire 28 -acres was utilized, the residents were assured the Ministry could contain the runoff with a stormwater retention pond (BMP) on the property. Now, the site is only 10 -acres, their engineers had indicated only handling the water on the 10 -acre site and the balance of the property diverted with ditches around the perimeter of the property. On the northwest corner of the 10 -acre site, a septic drain field exists and this will more than likely be an above ground. The Lonegrans are concerned whether there may be any steps to contain that. This posed a concern re traffic. Upon motion by Council Lady Henley, seconded by Vice Mayor Jones, City Council DEFERRED for two weeks, until the City Council Session of June 8, 2010, re concerns, Ordinance upon application of HARVEST OUTREACH MINISTRIES, INC. for Modification of Conditions 1 and 2 (approved by City Council on March 25, 2008) at 3168 Indian River Road, GPIN: 14838536720000 PRINCESS ANNE — DISTRICT 7. Voting: 11-0 Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer, Barbara M Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 Item M.6. PLANNING - 57 - ITEM # 60001 Upon motion by Vice Mayor Jones, seconded CONSENT, an Ordinance upon application CHURCH for a Conditional Use Permit for the Street, by Councilman Dyer, City Council ADOPTED, BY of VIRGINIA BEACH UNITED METHODIST expansion of the church for religious uses at 212 19`h BE IT HEREBY ORDAINED BY THE COUNCIL OF THE CITY OF VIRGINIA BEACH, VIRGINIA Ordinance upon application of VIRGINIA BEACH UNITED METHODIST CHURCH for a Conditional Use Permit re expansion of the church for religious uses at 212 19th Street, GPIN # 24271746690000;24271746720000;24271756590000;24271757940000; 24271766790000;24271755030000 BEACH— DISTRICT 6 RO51035416 The following conditions shall be required: 1. Development of the site shall substantially conform to the submitted plan entitled "VIRGINIA BEACH UNITED METHODIST CHURCH NORTH WING REPLACEMENT VIRGINIA BEACH, VIRGINIA", dated March 30, 2010, and prepared by HBA Design Build Services. Said plan has been exhibited to the Virginia Beach City Council and is on file in the Virginia Beach Planning Department. 2. The proposed multi-purpose building shall substantially conform to the submitted rendering entitled "VIRGINIA BEACH UNITED METHODIST CHURCH NORTH WING REPLACEMENT VIRGINIA BEACH, VIRGINIA", dated March 30, 2010, and prepared by HBA Design Build Services. Said plan has been exhibited to the Virginia Beach City Council and is on file in the Virginia Beach Planning Department. 3. The applicant shall insure that parking is provided at all times at a ratio of one (1) parking space for every five (5) seats in the Sanctuary. This Ordinance shall be effective in accordance with Section 107 (f) of the Zoning Ordinance. Adopted by the City Council of the City of Virginia Beach, Virginia, on the Twenty-fifth of May, Two Thousand Ten May 25, 2010 I Item M.6. PLANNING Voting: 11-0 (By Consent) Council Members Voting Aye: - 58 - ITEM # 60001 (Continued) Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 Item M.7. PLANNING -59- ITEM # 60002 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT, an Ordinance upon Application of T -MOBILE NORTH EAST, L.L.C./EDISON LANE STORAGE ASSOC., LLC, for a Conditional Use Permit re a communication tower : BE IT HEREBY ORDAINED BY THE COUNCIL OF THE CITY OF VIRGINIA BEACH, VIRGINIA Ordinance upon Application of T -MOBILE NORTH EAST, L.L.C./EDISON LANE STORAGE ASSOC., LLC, for a Conditional Use Permit re a communication tower at 1744 General Booth Boulevard, (GPIN #24154380590000) PRINCESS ANNE — DISTRICT 7 RO51035417 The following conditions shall be required: 1. The tower shall be constructed substantially as shown on the site plans entitled "T - Mobile Northeast, LLC, Site Name: Edison Self Storage RL, Site Number: VA60573-B, Site Address: 1744 General Booth Blvd., Virginia Beach, VA 23454, City of Virginia Beach " prepared by Allpro Consulting Group, Inc., and last revised March 25, 2009. This site plan has been exhibited to City Council and is on file with the Department of Planning. 2. The tower, including antennas and lightning rod, shall not exceed one -hundred thirty- nine (139) feet in height. 3. In the event interference with any City emergency communications facilities arises from the use of this tower, the user(s) shall take all measures reasonably necessary to correct and eliminate the interference. If the interference cannot be eliminated within a reasonable time, the user shall immediately cease operation to the extent necessary to stop the interference. 4. Should the antennas cease to be used for a period of more than one (1) year, the applicant shall remove the antennas, their supporting tower and related equipment. 5. The Director of Planning may allow the installation of a type of antenna different from that shown on the plans described in Condition 1, if the Director determines that the proposed antenna type will (a) not result in any undue impact beyond the antenna type shown in the submitted plan described in Condition 1 and (b) meets all other relevant requirements of Section 232 of the City Zoning Ordinance. 6. A solid fence, including the gate, shall be installed in lieu of the six (6)- foot chain link fence located around the tower and shown on the submitted site plans entitled "T -Mobile Northeast, LLC, Site Name: Edison Self Storage RL, Site Number: VA60573-B, Site Address: 1744 General Booth Blvd., Virginia Beach, VA 23454, City of Virginia Beach" prepared by Allpro Consulting Group, Inc. and last revised March 25, 2009. Barbed wire shall not be permitted on any fencing on-site. May 25, 2010 - 60 - Item M.7. PLANNING ITEM # 60002 (Continued) 7. Communication tower landscape requirements, as identified within Section 232 of the Zoning Ordinance, shall be waived. A landscape strip, a minimum of ten (10) feet in width, shall be located between the southern right-of-way line and the adjacent drive aisle curb line. A landscape strip, a minimum of ten (10) feet, shall also be provided along the southern thirty-two (32) feet of the eastern property line and the property line just west of the tower. Category IV evergreen landscape material shall be provided within said landscape area. This Ordinance shall be effective in accordance with Section 107 f of the Zoning Ordinance. Adopted by the City Council of the City of Virginia Beach, Virginia, on the Twenty-fifth of May, Two Thousand Ten Voting: 11-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 Item M.B. PLANNING -61 - ITEM # 60003 III Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED an Ordinance, BY CONSENT, upon application of the CITY OF VIRGINIA BEACH for a Conditional Use Permit re outdoor artists market (flea market) at Parks Avenue and 19`" Street, BEACH — DISTRICT 6 BE IT HEREBY ORDAINED BY THE COUNCIL OF THE CITY OF VIRGINIA BEACH, VIRGINIA Ordinance upon application of the CITY OF VIRGINIA BEACH for a Conditional Use Permit re outdoor artists market (flea market) at Parks Avenue and 19th Street, (GPIN # 241787715800000) BEACH — DISTRICT 6 RO51035418 The following conditions shall be required: 1. Operation of the market shall occur only once per week on Saturday between 7:00 A.M. and 6:00 P.M. during the months of May through September. The market may also operate a special "Holiday Market" on one Saturday in November and one Saturday in December 2. Trash and recycling receptacles shall be located at the entrances/exits to the market and at other locations on the site as determined by the operator of the market. The site shall be cleared of trash at the conclusion of each market day and all receptacles shall be removed and contents properly disposed of at the end of each market day 3. Parking for the market shall not occur on the site but instead shall occur within the Convention Center parking area on the south side of 19th Street 4. The only items to be sold at the market shall be works of the artists who are provided a space within the market area 5. The Zoning Administrator shall review this Use Permit on an annual basis to determine if there have been any issues during the prior season of operation that negatively impact on the compatibility of the use with the surrounding area to the extent that a re-evaluation of the Use Permit is necessary. If so, the Use Permit shall be re-evaluated by the Planning Department staff who shall recommend appropriate action to the Planning Commission and City Council This Ordinance shall be effective in accordance with Section 107 (f) of the Zoning Ordinance. Adopted by the City Council of the City of Virginia Beach, Virginia, on the Twenty-fifth of May, Two Thousand Ten May 25, 2010 Item M.8. PLANNING Voting: 11-0 (By Consent) - 62 - ITEM # 60003 (Continued) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent.• None May 25, 2010 -63- Item M.9. a. PLANNING ITEM # 60004 The following registered in SUPPORT: Attorney R. J. Nutter, 222 Central Park Avenue, Phone: 687-7500, represented Adams Outdoor Advertising, a proponent of this Ordinance. Attorney Nutter advised he has worked closely with the City Staff. Attorney Nutter had agreed to contact former Mayor Robert Jones, representative of the opposition to request an INDEFINITE DEFERRAL of this application defining electronic display billboards. Attorney Nutter advised all of the their representatives not to attend and speak i.e. members of the FBI, a twenty (20) year veteran of the Virginia Department of Transportation, Director of Crime Line and Crime Solvers, representatives of the American Red Cross, Chair of the Chamber of Commerce and their delegation, as well as Bobby Mellatti of the American Music Festival, all whom had also spoken to the Planning Commission The following registered in OPPOSITION : Robert G. Jones, represented the Beautification Commission, and noted their decision to go forward with the presentation. He wished the existing Ordinance to remain. The proposal represents a radical departure from the existing Ordinance. The Resort Area Advisory Commission (RAC) has had the most impact re beauting the City. There are fifty-one landscape companies in existence today and each one pays more business license tax to the City of Virginia Beach than Adams Outdoor Advertising. Adams does not pay any tax to the City. Anna Brown, served as President of the Council of Garden Clubs from 1987 to 1989. The present Billboard ordinance (effective 1987) has assisted greatly for twenty-three (23) years re the appearance of the City. The City has undergone a great improvement. The Council of Garden Clubs recently celebrated their 60th Anniversary, donating an estimated $1 -MILLION worth of projects (not including the volunteer hours) they have contributed to the City. Johnnie Miller, resident of Kempsville for approximately 40 years. Ms. Milller is a Past President of the Council of Garden Clubs, as well as Past President — Beautification Commission. Digital Billboards are not needed. Over twenty (20) years ago, a Citizens' Committee, with the vote of City Council, decided that billboards were no longer wanted or needed. Thus, the number of billboards was drastically reduced. Pat Bridges, life-long resident, whose objective has been to live in attractive surroundings. Mr. Bridges has expended many unpaid hours volunteering toward this goal including his membership and participation in the Virginia Beach Beautification Commission. "Beauty is good Business ". The existing City regulations re signs are the results of his serving on a Citizens' Committee. Janet Werndli, Kings Grant resident for forty-three (43) years, as well as a member of several community organizations and a Volunteer on numerous local projects. Some states have even banned Billboards. The present Ordinance does not allow for the improvement of the Billboards for more than fifty (50%) percent of their value. Ms. Werndli urged the present Ordinance remain in place. Carol Klobachar, resident of the Little Neck area. Adams Outdoor Advertising is clouding the issue and wishes the citizens to believe that without digital billboards, safety is at risk. The City has numerous ways to provide critical public safety and health information for its citizens, businesses and visitors when needed. Safety messages come in many forms, television/radio, www.vb.gov.com (the City's official website), message boards along 1-264 and I- 64, the emergency alert system - VB ALERT, and the City- wide traffic signal system upgrade project. Through a federal grant program, Public Works is currently erecting message signs at key traffic locations. Almost every non-profit organization usually sends requests through the mail and telephone. Ms. Klobachar urged the present Ordinance remain in place. May 25, 2010 - 64 - Item M. 9. a. PLANNING ITEM # 60004 The following registered in OPPOSITION : Reba McClanan, referenced the Planning Commission Summery re digital billboards contained in the City Council Agenda. In the 1980's, it was the businessmen who worked with this City Council to improve General Booth i.e. Dick Browner, Gene Walters, Wayne McLeskey, Robert Stanton and others. Last week, TowneBank won first place for the best and most attractive facility in the Beach District. Mike Barrett, accepted the award. Vice Mayor Jones has set an example through his businesses. Betty Villers, resident for forty-one years. In Cleveland, Clear Channel Outdoor expended $3.6 -Million converting seven (7) of their static boards to digital. Their revenue increased from $300, 000 to $3 - Million in one year. They can have ten (10) times as many clients with the changing messages. Adams does not pay taxes in Virginia Beach. Ms. Villers is concerned with driver distraction and roadway safety. Brenda Knowles, resident for over 40 -years , served as President of the Council of Garden Clubs, President — Princess Anne County/ Virginia Beach Historical Society, Chair — Virginia Beach Preservation Partnership, six (6) years on the Historic Review Board and fifteen (1 5) years on the Francis Land House Board of Governors. Last year, as she completed her term of office as President on the Council of Garden Clubs, their efforts to raise funds for the City's Miyazaki -Japanese Garden in Red Wing Park resulted in a check for $10, 000 being presented to the City of Virginia Beach. Ms. Knowles expressed appreciation to Mayor Sessoms for the outstanding 2010 State of the City address. On page 9 of the Mayor's address: "Twenty years ago, Resort Advisory Commission Members, began a push for enhancement at the Oceanfront, just look at it now, the ugly signs are gone and the overhead wires have been laid to rest. Our Virginia Beach Boardwalk is now recognized as one of ten great public spaces in America. None of these things happened by chance, they are the result of deliberate smart planning and successful collaboration by visionaries who were fired up about the future". Jeanette Willenbrink, resident of Pembroke Meadows since 1970. "Beauty is good business" is a phrase coined by Pat Bridges of the Beautification Commission, many years ago. If Billboards were such an important factor in our business cycle, why has Virginia Beach doubled in size while the number of billboards has been reduced by `half since the 1980's. Ms. Willenbrink quoted Mayor Sessoms from a campaign ad in May 1984: "Progress keeps the community healthy, planning keeps it beautiful, a changeable LED Billboard is not a sign of progress." Judy Connors, represented herself and expressed concern re digitalizing the billboards in the Shore Drive area. Ms. Connors referenced the future plans for the beautiful new signature bridge to replace the Lesner. The sight of the billboards, when coming off the bridge and heading East, are bad enough now, but what kind of first impression will our visitors have to see these billboards "all lit up". Sam Reid, resigned as President — Council of Civic Organizations on May 10, 2010, but represents the CCO tonight. A general meeting was held with an invitation to Adams Advertising and the Beautification Commission. The Adams Advertising said they would appear and then declined. At the end of the presentation, a vote was taken which was almost unanimous against the Billboards. May 25, 2010 - 65 - Item M.9.a. PLANNING ITEM # 60004 (Continued) Dick Olenyca, 5572 War Admiral, Phone: 490-2964, believed to be the only one on the side of Adams Advertising. City Council's obligation is to protect the citizens by any method. Nancy Parker, advised part of the problem concerned an e-mail received last evening from Adams Advertising forwarded by their Sales Manager reflecting their hope to be placed on a City Council Agenda in the near future to see this be brought to a favorable vote; "However, if anyone was available it would not hurt to have some support in the meeting tomorrow night, in the event this should be pushed to a vote." Therefore, Ms. Parker and the others believed they needed to be present. She was also concerned re the difference between a Deferral and an Indefinite Deferral, as this item could be scheduled at any time. Ms. Parker is a 42 year resident of Virginia Beach. Adams Advertising does not pay taxes to Virginia Beach. A MOTION was made by Councilman Diezel, seconded by Councilman Dyer to DEFER INDEFINITELY Sections 111, 215, and 216 to ADD Section 218 defining electronic display billboards and ESTABLISH a fee in the amount of Four Hundred Dollars ($400.00) for electronic display billboard applications as authorized by Virginia Code Section 15.2-2286 (A)(6). A SUBSTITUTE MOTION was made by Vice Mayor Jones, seconded by Council Lady Henley to DENY Sections 111, 215, and 216 to ADD Section 218 defining electronic display billboards and ESTABLISH a fee in the amount of Four Hundred Dollars ($400.00) for electronic display billboard applications as authorized by Virginia Code Section 15.2-2286 (A)(6). A SECONDARY SUBSTITUTE MOTION was made by Councilman Davis, seconded by Councilman Diezel to ADOPT the (Referred Ordinance — Requested by Councilmember Harry E. Diezel) Sections 111, 215, and 216 to ADD Section 218 defining electronic display billboards and ESTABLISH a fee in the amount of Four Hundred Dollars ($400.00) for electronic display billboard applications as authorized by Virginia Code Section 15.2-2286 (A)(6). Mayor Sessoms DECLARED A 5 -MINUTE RECESS to consult the City Attorney re Roberts Rules of Order. Mayor Sessoms RECONVENED the Formal Session: A SUBSTITUTE MOTION was made by Vice Mayor Jones, seconded by Council Lady Henley to DENY: Sections 111, 215, and 216 to ADD Section 218 defining electronicdisplay billboards and ESTABLISH a fee in the amount of Four Hundred Dollars ($400.00) for electronic display billboard applications as authorized by Virginia Code Section 15.2-2286 (A)(6). May 25, 2010 - 66 - Item M.9.a. PLANNING ITEM # 60004 (Continued) Voting: 5-6 (MOTION LOST TOA NEGATIVE VOTE) Council Members Voting Aye: Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., Rosemary Wilson and James L. Wood Council Members Voting Nay: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer and John E. Uhrin Council Members Absent: None May 25, 2010 - 67 - Item M.9. a. PLANNING ITEM # 60004 (Continued) Upon motion by Councilman Diezel, seconded by Councilman Dyer, City Council DEFERRED INDEFINITELY:: Ordinance to AMEND the City Zoning Ordinance (CZO): Sections 111, 215, and 216 to ADD Section 218 defining electronic display billboards and ESTABLISH a fee in the amount of Four Hundred Dollars ($400.00) for electronic display billboard applications as authorized by Virginia Code Section 15.2-2286 (A)(6). Voting: 6-5 Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer and John E. Uhrin Council Members Voting Nay: Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., Rosemary Wilson and James L. Wood Council Members Absent: None May 25, 2010 - 68 - Item M.9. b. PLANNING ITEM # 60005 Upon motion by Vice Mayor Jones, seconded by Councilman Dyer, City Council ADOPTED, BY CONSENT: Ordinance to AMEND the City Zoning Ordinance (CZO): Section 501 to allow cemeteries, columbariums, crematoriums and mausoleums as Conditional Uses in the R-20, R-30 and R-40 Residential Zoning Districts Voting: 10-0 (By Consent) Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Abstaining: Vice Mayor Louis R. Jones, Council Members Absent: None Vice Mayor Jones DISCLOSED Pursuant to Section 2.2-3115(G), Code of Virginia re City Council's discussion and vote on Section 501 of the City Zoning Ordinance to allow cemeteries, columbariums, crematoriums and mausoleums as Conditional Uses in the R-20, R-30 and R-40 Residential Districts (Item 9b). Vice Mayor Jones is a member of the funeral business, and has an ownership interest in both Tidewater Cemetery Corporation and Holloman -Brown Funeral Home, Inc. His ownership interest in both corporations exceeds 3% of the total equity in each corporation. He is a member of a business or profession (the funeral business) and a group (persons with an ownership interest in the funeral business) the members of which are affected by City Council 's consideration of this application. Although he is able to participate fairly, objectively and in the public interest, Vice Mayor Jones wishes to ABSTAIN Vice Mayor Jones ' correspondence of May 24, 2010, is hereby made a part of the record. May 25, 2010 LOUIS R. JONES VICE MAYOR Refer to File No.: 0041612 Mrs. Ruth Hodges Fraser, MMC City Clerk Municipal Center Virginia Beach, Virginia 23456 City of Vir irzia 1 ;each May 24, 2010 Re: Disclosure Pursuant to Section 2.2-3115(G), Code of Virginia Dear Mrs. Fraser: PHONE: (757) 583-0177 FAX: (757) 588-4659 Pursuant to the Virginia Conflict of Interests Act, Section 2.2-3115(G), Code of Virginia, I make the following declarations: 1. I am executing this written disclosure regarding City Council's discussion and vote on Section 501 of the City Zoning Ordinance to allow cemeteries, columbariums, crematoriums and mausoleums as Conditional Uses in the R-20, R-30 and R-40 Residential Districts. 2. I am a member of the funeral business, and I have an ownership interest in both Tidewater Cemetery Corporation and Holloman -Brown Funeral Home, Inc. My ownership interest in both corporations exceeds 3% of the total equity in each corporation. 3. I am a member of a business or profession (the funeral business) and a group (persons with an ownership interest in the funeral business) the members of which are affected by Council's consideration of this application. 4. I am able to participate in this transaction fairly, objectively, and in the public interest. Accordingly, I respectfully request that you record this declaration in the official records of City Council. Thank you for your assistance in this matter. LRJ:DRH:ks 1008 WITCH POINT TRAIL, VIRGINIA BEACH, VA 23455-5645 II I 1 AN ORDINANCE TO AMEND SECTION 501 OF THE CITY 2 ZONING ORDINANCE TO ALLOW CEMETERIES, 3 COLUMBARIUMS, CREMATORIUMS AND MAUSOLEUMS 4 AS CONDITIONAL USES IN THE R-20, R-30 AND R-40 5 RESIDENTIAL ZONING DISTRICTS 6 7 Section Amended: City Zoning Ordinance Section 501 8 9 10 WHEREAS, the public necessity, convenience, general welfare and good zoning 11 practice so require; 12 13 BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF VIRGINIA 14 BEACH, VIRGINIA: 15 16 That Section 501 of the City Zoning Ordinance is hereby amended and 17 reordained to read as follows: 18 19 Sec. 501. Use regulations. 20 21 (a) Principal and conditional uses. The following chart lists those uses 22 permitted within the R-40 through R-2.5 Residential Districts. Those uses and structures 23 in the respective residential districts shall be permitted as either principal uses indicated 24 by a "P" or as conditional uses indicated by a "C." Uses and structures indicated by an 25 "X" shall be prohibited in the respective districts. No uses or structures other than as 26 specified shall be permitted. 27 28 Residential Districts: 29 30 Uses R-40 R-30 R-20 R-15 R-10 R-7.5 R -5D R -5R R -5S R-2.5 31 32 33 34 Cemetery, 35 columbarium, 36 crematory and 37 mausoleum XC XC XC CCCC CC X 38 39 40 Adopted by the City Council of the City of Virginia Beach, Virginia, on the 25th day of May, 2010. 1 - 69 - Item N.1. APPOINTMENTS ITEM # 60006 BY CONSENSUS, City Council RESCHEDULED the following APPOINTMENTS: BEACHES and WATERWAYS COMMISSION SOCIAL SERVICES BOARD 1 II May 25, 2010 - 70 - Item N.2. APPOINTMENTS ITEM # 60007 Upon NOMINATION by Vice Mayor Jones, City Council REAPPOINTED: Kal Kassir 3 year term July 1, 2010 — June 30, 2013 BAYFRONT ADVISORY COMMMITTEE Voting: 11-0 Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 11 1 -71 - Item N.3. APPOINTMENTS ITEM # 60008 Upon NOMINATION by Vice Mayor Jones, City Council APPOINTED: Byron Williams Amma Anyane-Ntow Guerrier 2 -year term — June 1, 2010 — May 31, 2012 MINORITY BUSINESS COUNCIL Voting: 11-0 Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer, Barbara M Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 - 72 - Item N.4. APPOINTMENTS ITEM # 60009 Upon NOMINATION by Vice Mayor Jones, City Council REAPPOINTED: Councilman John E. Uhrin Councilman James L. "Jim" Wood 2 year term July 1, 2010 — June 30, 2012 TIDEWATER TRANSPORTATION DISTRICT COMMISSION OF HAMPTON ROADS Voting: 11-0 Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M Dyer, Barbara M Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 - 73 - Item N.S. APPOINTMENTS ITEM # 60010 Upon NOMINATION by Vice Mayor Jones, City Council REAPPOINTED: Barbara Brinson 4 year term July 1, 2010 — June 30, 2014 TIDEWATER YOUTH SERVICES COMMISSION Voting: 11-0 Council Members Voting Aye: Rita Sweet Bellitto, Glenn R. Davis, William R. "Bill" DeSteph, Harry E. Diezel, Robert M. Dyer, Barbara M. Henley, Vice Mayor Louis R. Jones, Mayor William D. Sessoms, Jr., John E. Uhrin, Rosemary Wilson and James L. Wood Council Members Voting Nay: None Council Members Absent: None May 25, 2010 - 74 - Items Q. ADJOURNMENT ITEM # 60011 Mayor William D. Sessoms DECLARED the City Council Meeting ADJOURNED at 7:51 P.M. Beverly O. Hooks, CMC Chief Deputy City Clerk th Hodges Fraser, MMC City Clerk City of Virginia Beach Virginia William D. Sessoms, Jr. Mayor May 25, 2010 - 74 - Items Q. ADJOURNMENT ITEM # 60011 Mayor William D. Sessoms DECLARED the City Council Meeting ADJOURNED at 7:51 P.M. Beverly b. Hooks, CMC Chief Deputy City Clerk uth Hodges Fraser, MMC City Clerk City of Virginia Beach Virginia William D. Sessoms, Jr. Mayor May 25, 2010