Submitted by Christopher Ragucci
CEO Worldwide Terminals Fernandina (WTF)
October 18, 2018 — 10:38 a.m.
Fernandina Observer notes: Mr. Ragucci asked to rebut and/or clarify information presented in our article about Clyde Davis’ resignation as Port Authority Attorney. His response is provided below.
Worldwide Terminals Fernandina (“WTF”) acquired Nassau Terminals LLC on February 7, 2018
Nassau Terminals was and still is the Operator of the Port of Fernandina pursuant to the existing Operating Agreement (“OA”) which has 5 years left to go.
Under the old Operating Agreement, OHPA had no legal right to approve the acquisition other than WTF needed their consent to pledge the OA to our bank as collateral. They did not “hire” us to be their Port Operator.
As part of the acquisition, WTF paid-off $6.2 million of OHPA’s outstanding bond debt, and agreed to finance another $4.56 million in Advance Use Fees that OHPA owed to Nassau Terminals, with the firm agreement and commitment that by OHPA’s Counsel (who advised that he represents the Commissioners) AND OHPA’s Chairman that we would REPAID through the execution of new long-term (30-year) Operating Agreement which would allow us to recoup this debt (plus interest) over 12 years. This was the only alternative since OHPA was unable to pay us the $10.7 million it owed.
OHPA (through OHPA’s Counsel and Chairman) agreed with this arrangement and encouraged us to go forward with the acquisition. This agreement was witnessed by OHPA’s Financial Advisor.
For the sake of clarity, WTF is OWED and has been carrying $10.7 million of OHPA’s debt since February 7, 2018.
A 30-year Operating Agreement is standard in the Port industry and is required to support the tens of millions of dollars in investment that is required. Without this agreement in place, WTF will not be able to make the investments that are required to be made for the long-term survival and prosperity of the Port.
Davis’ statement that WTF “has not paid monies due to OHPA under the current Operating Agreement” is patently false. There are presently no monies due and owed under the existing Operating Agreement.WTF has honored all its obligations under the existing Operating Agreement.
Davis’ statement that “3rdquarter dockage, wharfage and use feesare due and owing” is also not true. If the existing Operating Agreement remains in force, these monies would not be due and owing until the end of October. Irrespective, any dockage, wharfage and use fees would be employed to OFFSET the $10.7mm owed by OHPA to WTF, as they have been for the previous two quarters, as ratified by OHPA resolutions.
The plan that was agreed to between the WTF and OHPA in April was to make sure that the negotiations of the new Operating Agreement were completed by October 1st. This was to ensure that all payments under the new Operating Agreement would fund OHPA’s NEW operating budget. There is no financial crisis here for OHPA. They just need to conclude the negotiations in an orderly and businesslike fashion and allow us to get back to our focus on growing the Port of Fernandina and attracting more ships and new shippers.
We have already proved our commitment to being good stewards of the Port and true partners with OHPA in connection with the new crane. Even though there was a direct grant of $2 million from the State legislature to fund the crane, it wasn’t accessible until the crane was delivered from overseas. OHPA did not have the money to advance to cause the crane to be delivered, so WTF arranged for BB&T Bank to provide a bridge loan on favorable terms and conditions to OHPA, and for the first time in 30 years, the Port of Fernandina has a new crane on the way.
This debacle directly models everything in Nassau County government. Who is telling the truth? Where is the money? Are we really going for broke? “We The People” demand transparency and complete accountability.
“As part of the acquisition, WTF paid-off $6.2 million of OHPA’s outstanding bond debt, and agreed to finance another $4.56 million in Advance Use Fees that OHPA owed to Nassau Terminals, with the firm agreement and commitment that by OHPA’s Counsel (who advised that he represents the Commissioners) AND OHPA’s Chairman that we would REPAID through the execution of new long-term (30-year) Operating Agreement which would allow us to recoup this debt (plus interest) over 12 years.”
Assuming this is true, it would appear to violate the Florida Sunshine laws, and therefore any agreement would appear to be null and void. [see below]
chip ross
From the Florida Sun Shine Law Manuel
AA
“On the other hand, if the board member has been delegated the authority to reject certain options from further consideration by the entire board, the board member is performing a decision-making function that must be conducted in the sunshine. AGOs 95-06 and 93-78. See also AGO 90-17 (while Sunshine Law not violated by a city council member meeting with private contractor for information gathering purposes, if the board member has been authorized, formally or informally, to exercise any decision-making authority on behalf of the board, such as approving or rejecting certain contract provisions, the board member is acting on behalf of the board and the meetings are subject to s. 286.011, F.S.). And see Broward County v. Conner, 660 So. 2d 288, 290 (Fla. 4th DCA 1995), review denied, 669 So. 2d 250 (Fla. 1996) (since Sunshine Law provides that actions of a public board are not valid unless they are made at an open public meeting, a county’s attorneys would not be authorized to enter into a contract on the commission’s behalf “without formal action by the county commission at a meeting as required by the statute”).”
“Validity of action taken in violation of the Sunshine Law and subsequent corrective action Section 286.011, F.S., provides that no resolution, rule, regulation or formal action shall be considered binding except as taken or made at an open meeting. Recognizing that the Sunshine Law should be construed so as to frustrate all evasive devices, the courts have held that action taken in violation of the law is void ab initio. Town of Palm Beach v. Gradison, 296 So. 2d 473 (Fla. 1974)…”
What sunshine laws? I have a feeling neither OHPA or WTF’s “people” ever considered such a thing. Both entities have always operated in the dark. That said, I’m more concerned about what WTF intends to bring into our downtown port. Does the old charter remain in place? Was it ever changed to meet Fernandina Beach demands? Are coal, liquid natural gas and other hazardous materials part of the new equation to expand the port? Too many questions….not enough answers.
Ragucci states that Worldwide Terminals Fernandina (“WTF”) acquired Nassau Terminals LLC on February 7, 2018 and as part of the acquisition, WTF paid-off $6.2 million of OHPA’s outstanding bond debt.
Accelerating the bond debt with its nominal interest carrying cost approximately three years prior to its due date of December 1, 2020, was a decision by Worldwide. Alternatively, Worldwide could have focused on building port business between February 2018 and December 2020 and requested its bank to issue a letter of credit to support the bond debt like Kinder Morgan did for the many it owned Nassau Terminals. Paying the bond debt prior to maturity was a business decision by Worldwide, and perhaps in retrospect, a poor use of capital given the required investments that need to be made, as Mr. Ragucci believes “for the long-term survival and prosperity of the Port”.
This writer agrees with others who have pointed out the lack of “Sunshine”. As stated in the OHPA Charter, OPHA is “accountable to the Nassau County electorate” and county residents have a right to understand how Worldwide, a mid-level market port operator, intends to increase port business when a multi-billion-dollar international company like Kinder Morgan was unsuccessful in that endeavor during the 28 years it operated the port.
FB citizen here. Not below average IQ. But this is hard to follow and it shouldn’t be. Who said he said, and who said what? Whatever the deal is, it doesn’t smell right. It’s hard to understand what the future of the FB port is, and how it might impact our lifestyle. Should not be that hard.