HomeMy WebLinkAboutEmergency Item - McCormick Woods Phase 1 Default of Two Year Maintenance Requirement
AGENDA ITEM COVER SHEET
Contact Name:
Contact Number:
David A. Wheeler, P.E.
407-905-3100, ext. 1504
Meeting Date: September 15, 2009
Item # "EYY")~vgenc~~~ .
Reviewed By: ~c.' U
Department Director: ..... . N /,
City Manager: ---i
Subject: McCormick Woods Phase 1 Default of Two Year Maintenance Requirement
District 1 - Commissioner Gary Hood
Background Summary:
The McCormick Woods residential development is located at the southwest corner of McCormick And Ingram
Roads in north Ocoee. The development was being constructed/developed in three phases by KKH, LLC.
Phase 1 has been platted, the entire infrastructure has been constructed, and many of the lots are occupied
with houses. As part of the Land Development Code, the developer is required to furnish a bond or letter of
credit for the two-year maintenance guarantee covering all site improvements (paragraph 4-4.G.(6).
Near the end of that two year maintenance period staff along with representatives of KKH, LLC and their
contractor performed an inspection of the infrastructure constructed as part of phase 1. Numerous items were
identified as needing repair and/or replacement. Most of the items were broken curbing and damaged
stormwater inlets.
Unfortunately because of current economic times, KKH, LLC has fallen into financial hardship and is not in a
position to pay for the repairs outside of the posted Letter of Credit. KKH, LLC informed the City to call upon
the Letter of Credit provided for the Two-Year Maintenance requirement of the project. Therefore, the City
needs to declare that KKH, LLC is in default of the requirement for the Two-Year Maintenance of Phase 1 of the
McCormick Woods.
Issue:
Declaration of Default of KKH, LLC on McCormick Woods Phase 1 Two-Year Maintenance
Recommendations:
The Engineering Department recommends that the City Commission declare KKH, LLC in default of the Two
Year Maintenance on McCormick Woods Phase 1, authorize the Mayor, City Clerk, and special Counsel to sign
the Statement of Default, and authorize the City Manager and staff to produced the required documentation to
the First National Bank of Central Florida to draw upon said Letter of Credit to effect the repairs required to
finalize McCormick Woods Phase 1.
Attachments:
Irrevocable Letter of Credit from First National Bank of Central Florida for KKH, LLC
Letter from KKH, LLC, dated August 31, 2009
Memorandum from Fowler, O"Quinn, Feeney & Sneed P.A. (with attachments)
Statement of Default
Financial Impact:
There are no financial impacts to the City because the Letter of Credit is covering the actual cost of the work.
The only impact to the City is staff time in handling this issue.
Type of Item: (please mark with an "x'1
_ Public Hearing
_ Ordinance First Reading
_ Ordinance Second Reading
Resolution
_ Commission Approval
Discussion & Direction
For Clerk's DeDt Use:
_ Consent Agenda
_ Public Hearing
_ Regular Agenda
_ Original Document/Contract Attached for Execution by City Clerk
_ Original Document/Contract Held by Department for Execution
Reviewed by City Attorney
Reviewed by Finance Dept.
Reviewed by 0
,
~~It
N/A
N/A
N/A
2
. "First National
I . BANK OF CENTRAL FLORIDA
369 North New York Avenue . Winter Park, Florida 32789 . Corporate: 407.622.5000 . Fax: 407.622.0770
Irrevocable Letter of Credit Number 07-14
September 17, 2007
BENEFICIARY
City of Ocoee
Board of City Commissioners
150 North Lakeshore Drive
Ocoee, Florida 34761
APPLICANT
KKH, LLC
3100 Clay Street, Suite 275
Orlando, Florida 32804
AMOUNT
USD $77,264.41
Seventy Seven Thousand Two Hundred
Sixty Four and 41/100 US Dollars
EXPIRATION
September 17, 2009
IRREVOCABLE LETTER OF CREDIT
Dear Sirs:
We hereby issue in your favor this Irrevocable Letter of Credit to the Board of City
Commissioners of Ocoee, Florida, in an amount up to an aggregate of SEVENTY SEVEN
THOUSAND TWO HUNDRED SIXTY-FOUR AND 41/100 U.S. DOLLARS ($77,264.41).
This Irrevocable Letter of Credit is available by negotiation of your draft at sight drawn on First
National Bank of Central Florida, having an address at 369 North New York Avenue, Winter
Park, Florida 32789, bearing the clause: "Drawn under Letter of Credit No. 07-14 of First
National Bank of Central Florida accompanied by the original of this Letter of Credit and the
signed statement of the Board of City Commissioners that the Maintenance Agreement between
KKH, LLC and the City of Ocoee for McCormick Woods is in default.
This Letter of Credit sets forth in full the terms of our undertaking to you. Such undertaking
shall not in any way be modified, amended or amplified by reference to any document or
instrument referred or related to herein and any such reference shall not be deemed to incorporate
herein by reference any such document or instrument.
The original of this Letter of Credit must be presented to us with any drawings hereunder for our
endorsement of any payments effected by us. Partial drawings are permitted.
Irrevocable Letter of Credit No. 07-14
City ofOcoee
September 17, 2007
This Letter of Credit is subject to the Uniform Customs and Practice for Documentary Credit
(1998 Revision, International Chamber of Commerce Publication No. 590). If a conflict between
the Uniform Customs and Practice for Documentary Credits and Florida law should arise, Florida
law shall prevail. If a conflict between the law of another state or country and Florida law should
arise, Florida law shall prevail.
Very truly yours,
FIRST NATIONAL BANK OF CENTRAL
FLORIDA
Co- ~ V () /t.e~
Carolyn H. S og, Senior Vice P sldent
bJ[Ull
Daniel F. lliams, Executive Vice President
Irv ~ @ [f, u liJ ~ m
UIJ SEP 03 2009 ~i
KKH, LLC
By
3100 Clay Street, Suite 275, Orlando, Florida 32804 tel.(407) 896-9059 fax (407) 894-2276
VIA FACSIMILE: (407) 905-3167 and U.S. MAIL
August 31, 2009
Mr. David Wheeler, P.E.
City Engineer
City ofOcoee
150 N. Lakeshore Dr.
Ocoee, FL
RE: Maintenance Bond Letter of Credit - McCormick Woods.
Dear David,
As you are aware the two year period for the above referenced Maintenance Bond is coming to a close. We
have had a walk through with a City representative and a list of items which need correcting has been
created. Please note that while the list references the sidewalk along McCormick Road, we do not believe
that it should be included as that improvement is not required to be completed until the issuance of the
McCormick Woods Phase 3 Certificate of Completion. Enclosed is a copy ofa letter from the City dated
September 18,2007, stating as such. We have bid the cost of these improvements (less the sidewalk) with
Amick Construction, a copy of which is also enclosed.
David, KKH is not in a position to pay for the improvements outside the posted Letter of Credit the City
holds. At this time we see no eventuality which would preclude us from the necessity of having the City
rely on the funds from the Letter of Credit to pay for these improvements.
Please do not hesitate to call either Dwayne Hamner (407) 497.7736 or me.
&:J~~,--
Presiq,ellt
JS&B Capital, Inc.
Man~ger
...
Mayor
S. Scott Vandergrift
center of Good II
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Commissioners
Gary Hood, District 1
Scott Anderson, District 2
Rusty Johnson, District 3
Joel F. Keller, District 4
City. Mana2er
Robel't Frank
September 18~ 2007
Mr. Dwayne R. Hamner
KKH, LLC
3100 Clay Street~ Suite 275
Orlando, Florida 32804
RE: McCOlmick Woods Phase 1
Dear Mr, Hamner:
Your development, McCormick Woods Phase 1, has been generally constructed in accordance
with the plans and changes as approved by the City of Ocoee with the two exceptions listed
below and the City has received all documentation required to fmal the project. This letter is
your Certificate of Completion and the two-year Wall'anty for this project stads with the date of
this letter. The two exceptions listed below will be completed before a certificate of completion
for McCOlmick Woods Phase 3 will be issued.
1. Provide a letter from Orange County stating that money has been dedicated to the
County's sidewalk fund and that the Orange County is aware of the school scheduled for
construction on Ingram Road and will have the sidewalk along McCormick Road west of
the subdivision entrance consuucted before the school opens. If no letter is provided by
Orange County to this effect it will be the responsibility of the developer to construct the
sidewalk per approved plans before the issuance of the McCormick Woods Phase 3
Certificate of Completion.
2. The developer is responsible for the redesign and construction of the round-about to
facilitate City of Ocoee emergency vehicles. The design must meet the City's
requirements and be constructed to the City's satisfaction. The round-about must be fully
designed and constructed before the Celtificate of Completion for McCormick Woods
Phase 3 will be issued.
City ofOcoee. 150 N Lakeshore Drive. Ocoee, Florida 34761
phone: (407) 905-3100 · fax: (407) 656-8504 . www.ci.ocoee.fl.us
Page 1 of2
The City will notify you when the inspections will be conducted Plior to the two-year warranty
period's termination. Should there be any reason to contact you prior to that time, we will use
the above listed address.
Should you have any questions, please do not hesitate to contact this office.
Sincerely,
~~
David A. Wheeler, P.E.
City Engineer
Cc: Robelt Frank, City Manager
Russ Wagner, Director of Community Development
Stephen Krug, Director of Public Works
Richard Firstner, Fire Chief
Ralph Jones, Chief Building Official
Charles Smith, Public Utility Director
City ofOcoee' 150 N Lakeshore Drive' Ocoee, Florida 34761
phone: (407) 905-3100' fax: (407) 656.8504. www.ci.ocoee.fl.us
Page 1 of2
08/27/2009 15:57
4072912815
AMICK CONSTUCTION
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, ,CONSTRUCTION, INC. ,
. ..,' '
. .' .
, McCormick Woods .Ph. 1 Sidewalk and Curb Repair
, . '
. . " :'. ,',
.' I .
" Remove Existilig Curb '"
, ,Miami Curb '
Typel'F" Curb, '
: saw Cut Joints;, , " ' ,
Remove EXisting Valley Gutter '
,3' VaUeyGutter, ' . '
Rarnove & Replace P~6 Top ','
3" x31 X 4", ConcreitePad. " ' '
" . 15ix5'x 4'i"Contrete,$ideWalk'"
" Item #49 Dowel' Cbmeroflnlet
'Itant'#62Patching Miami curb
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Items not included:
, PermitJeeif' , . ,
Sidewalk along' McCormick'Road
,Sodding '".' , ,,'
Retaining Walls; ,
Removing' or ConstructingWafls '
Weep Holes ' '
, Handrails'
,Mowing , ,.' '
" Irrigatiqn and Landscaping (new, & restoration) ,
1'.0. BCiX 56849,2
, '
, . ",' .
, '
II,CHtLAN'DO; H. 3~8SS-84.!12.
$19.50
$15:60,
, $17.00
$1,000.00
$19'..50 "
. $19.75
$1i~5.00, .
$'175.00
$$45.00 "
, $250.00 .
$250~OO',
Ill' P'HON11.: 40''7/2.93-SS62
$7,722.,OQ
$6,130.E$b
, $51.00
$1,00Q,OO '
, $643.50
. $651.75,
$3,650.00
, $115.00
$345.00
, $'250.00 ' '
$250.00
$20,869.05
PAGE 02
Iii FAX: 40?:/2!11-ZSiS'
FOWLER, O'QUINN, FEENEY & SNEED P.A.
PROFESSIONAL ASSOClA TlON
ATTORNEYS AND COUNSELORS AT LAW
JAMES A FOWLER *
MICHAELA. O'QUINN, P.A.**
THOMAS C. FEENEY, III, P.A.
MARYL. SNEED, P.A.
MARSHA SEGAL-GEORGE
EMPIRE BUILDING
28 W. CENTRAL 8L VD. 4th FLOOR
ORLANDO, FLORIDA
32801
TELEPHONE: (407) 425-2684
TELEFAX: (407) 425-2690
· Also admitted in Alaska and illinois
.. Also admitted in Georgia
MEMORANDUM
To:
From:
Re:
Date:
David Wheeler, City Engineer
Mary Sneed, Special Counsel
Draw on Letter of Credit
September 11, 2009
------------------------------------------------------------------------------------------------------------
The City has received correspondence from KKH, LLC indicating that it
will not be completing required sidewalk and curbing maintenance and repair
for the McCormick Woods development. First National Bank of Central Florida
issued Letter of Credit Number 07-14 in the amount of $77,264.41 for the City's
benefit on September 17, 2007. The LOC expires September 17, 2009.
To draw on the LOC, the bank requires a Draft drawn under the Letter of
Credit, the original Letter of Credit and a signed statement of the Board of City
Commissioners that the Maintenance Agreement between KKH, LLC and the City
of Ocoee for McCormick Woods is in default. As KKH, LLC has corresponded
with the City that it will not complete sidewalk maintenance and repair, and that
the City should draw on the LOC, it would appear KKH, LLC is in default.
As such, please have the City Commission find by motion that the
Maintenance Agreement between KKH, LLC and the City for McCormick Woods is
in default. I have prepared the Draft, a cover letter and the Statement by the
Mayor on behalf of the Commission regarding the finding of default. Have
those executed, and deliver same, along with the original LOC to the Bank, by
hand delivery, given the time considerations, on Wednesday September 16,
2009.
Please let me know should you have any questions regarding this matter.
ACTION OF THE OCOEE BOARD OF CITY COMMISSIONERS
STATEMENT OF DEFAULT
The undersigned, the Mayor of the City of Ocoee, Florida, on behalf of the Board of City
Commissioners, hereby states as follows:
THE BOARD OF CITY COMMISSIONERS OF THE CITY OF OCOEE, FLORIDA HAS
FOUND, BY MOTION AND VOTE ON SEPTEMBER 15, 2009, THAT THE
MAINTENANCE AGREEMENT BETWEEN KKH, LLC AND THE CITY OF OCOEE FOR
MCCORMICK WOODS IS IN DEFAULT IN THAT KKH, LLC HAS NOTIFIED THE CITY IT
WILL NOT BE COMPLETING THE REQUIRED REPAIRS TO THE CONSTRUCTED
INFRASTRUCTURE AS IDENTIFIED IN THE AUGUST 13,2009, INSPECTION.
BOARD OF CITY COMMISSIONERS,
CITY OF OCOEE, FLORIDA
Attest:
By:
Beth Eikenberry, City Clerk
Name: S. Scott Vandergrift
Title: Mayor, City of Ocoee
FOR USE AND RELIANCE ONLY BYTHE
APPROVED BY THE OCOEE CITY
CITY OF OCOEE, APPROVED AS TO FORM
COMMISSION IN A MEETING HELD ON
AND LEGALITY THIS
DAY OF
. 2009 UNDER
,2009.
AGENDA ITEM NO.
FOWLER, O'QUINN, FEENEY & SNEED P.A.
By:
City Attorney