THE VILLAGES - The government branch of The Villages approved the $86.4 million purchase of a utility company from the retirement community's developer Wednesday.

Consultants hired by the Village Center Community Development District determined the purchase price for Little Sumter Utility using the sale price of other water and wastewater utility companies in Florida and income projections based on financial information in company documents.

Village Center district administrator Pete Wahl said staff combined the estimates of the two consultants to arrive at the $86.4 million figure, which the district's board of supervisors approved unanimously without discussion.

"That number is the midpoint of the two appraisals," district administrator Pete Wahl said. "We feel it is a fair and equitable offer."

A third approach for determining a sale price, which would take into account the cost of replacing existing facilities, was not used.

"I decided the cost approach wasn't very valid," said Hank Fishkind of Fishkind & Associates, the Village Center district's financial consultant. Fishkind said he reviewed 20 utility sales in Florida over the last five years where buyers paid between $837 and $4,511 for each water and wastewater customer.

Fishkind estimated the VCCDD was paying about $3,700 for each water and sewer customer. The utility is projected to have 12,564 residential customers and 330 commercial customers at build-out, who will be served with both water and sewer. The company serves all of The Villages in Marion County and a significant number of homes built north of County Road 466 in Sumter County.

While the Florida cities of Marco Island and Palm Coast paid $82 million and $80 million each to acquire utility companies with more customers, Village Center district manager Gary Moyer said he believed the Little Sumter price was appropriate because the Villages system, built in 1997, was not in need of renovation.

"The condition of the facilities is excellent," Moyer said.

The VCCDD will issue bonds to pay for the company and use the company's water and wastewater revenues to pay off the debt. The VCCDD Board of Supervisors is a special government body formed under state law to provide infrastructure to the retirement community. Community development district supervisors are elected by property owners in the district.

Because the Village Center district is all commercial property, there are no resident property owners and the primary landowner is the community's developer. That means the developer essentially appoints the supervisors, often employees or business associates, who vote on purchasing utilities or recreational facilities.