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City authorizes $2.3 million settlement offer to Ormond Beach in Avalon Park utility dispute
Summary
Daytona Beach authorized an offer to Ormond Beach to buy out service rights created under two 2006 agreements affecting the Avalon Park development. City counsel said the $2.3 million offer would reduce Daytona Beach’s potential future exposure if Ormond asserted retrofit or impact-fee claims under the older agreements.
The Daytona Beach City Commission on Nov. 5 authorized an offer of settlement to the City of Ormond Beach for $2.3 million related to long-running litigation over utility service rights for the Avalon Park project.
City litigation counsel described four agreements executed in 2006 that define service boundaries and establish Ormond Beach’s right to provide service in portions of Daytona Beach’s jurisdiction in exchange for impact fees and potential wholesale charges. Counsel told the commission that those agreements could expose Daytona Beach to large retrofit and recurring costs if Ormond exercised its full rights under the 2006 documents. Counsel recommended a buyout offer as the most cost-effective resolution and said $2.3 million is less than the city’s potential exposure.
Avalon, the developer, has sued both cities, contending it cannot obtain required design information from Ormond to connect its utilities. Daytona Beach cross-claimed against Ormond and sought judicial relief to abrogate or clarify the agreements. Counsel said the settlement offer would remove two of the agreements’ constraints and allow the development to proceed without the potential for significant retrofitting costs to the city. The commission voted 4–2 to authorize transmitting the offer; counsel said the offer is contingent on Ormond Beach accepting the terms.
Public speakers asked that the city explain the terms and effects of the agreement in public; commissioners asked counsel to transmit the offer and report back on Ormond’s response.
