Councilman Jay Kramer Tuesday shared with the members of the Utility Commission his thoughts on how the city could more quickly lower rates for all 34,000 customers of Vero Electric.

In addition to explaining in detail the prospects of a partial sale, Kramer laid out several additional options, all of which he believes could lead to rate reductions.  Some, including Kramer and Councilman Richard Winger, believe the sale could be delayed until late 2016.  They argue that in order to lower rates now, other options should be considered.

Following Kramer’s presentation, the Utility Commission opted to stay the course already set by the City Council.  Apparently it was the assessment of the Commission that the proposals Kramer presented did not merit further consideration.

And perhaps it is with good reason the Utility Commission declined to more thoroughly explore the potential of a partial sale.  After all, determining how best to lower rates for all of Vero Electric’s 34,000 customers, while also preserving the financial viability of the city, is not within the purview of the Utility Commission.

That commission, composed of as many county residents as city residents, is specifically charged with advising the Council on utility operations.  Assessing and evaluating the proposed sale’s likely impact on the city’s overall finances, or weighing the relative merits of a full sale as compared to other options, are both tasks well beyond the scope or bounds of the Utility Commission.

Winger has suggested the financial implications of either a full sale or a partial sale should be considered by the Finance Commission and then by an independent consultant.  His advice, though, has not gained traction with Mayor Craig Fletcher, Vice Mayor Tracy Carroll or Councilwoman Pilar Turner.

Rather, the Council’s three-person majority seems determined to press ahead with a sale of the full system as soon as January 1, 2014.  Yet, many questions remain.

How much cash will the City actually net from a sale of Vero Electric?  Though Florida Power & Light has offered a fair price, will the sale turn out to be a good deal for the city?

Will the Florida Municipal Power Association be willing and able to grant the city a waver so it can end its membership in the All Requirements Project before October 1, 2016?

Will the FMPA’s bond counsels sign off on the deal, or will their concerns over the possible impact of the sale on the tax-exempt status of FMPA’s bonds put the deal in jeopardy?

And, if a sale of the full system cannot take place before late 2016, will the Council be willing to consider other options for lowering rates?

Rather than taking steps to reduce rates now, the Council has chosen to pay for capital improvements in a way that will actually increases rates.  Over the objections of Kramer and Winger, the Council has departed from the long-standing and customary practice of financing capital improvements.  Rather than capitalizing major power plant maintenance and improvements to the transmission and distribution system, Fletcher, Carroll and Turner are insisting these projects be paid for out of reserves.

In in the opinion of a number of sources familiar with utilities and municipal government, paying cash for long-term assets rather than  financing them is a serious mistake. Even a distressed business, they say, which is hardly the case for Vero Electric, would not pay cash when low interest borrowing is an option.  Why forgo the interest currently being earned on reserve funds, they ask, when it would cost less to finance these long-term capital projects?

If Vero Electric cannot be sold until late 2016, the Council’s decision to pay cash for capital projects will add some $25 million to operating expenses, all of which will show up in bills issued between now and when the system is finally sold.  In short, the Council seems inclined to pursue financial policies that will only serve to increase rates.

Fletcher, Carroll and Turner are also pressing ahead on a proposed mid-March referendum, though in the minds of many it seems doubtful a “substantial” contract will be negotiated in time to give voters an opportunity to make a considered, informed decision.

Lost in the now largely emotional debate over whether or not to sell Vero Electric is the need for serious discussions about how to expeditiously lower rates for all customers, while at the same time assuring the long-term financial health of the city.

Could it be that an unspoken agenda among some proponents of the sale is the desire to put the city in such financial difficulty that it will have no choice but to disincorporate and become a part of  “Indian Riverville?”

And could there be some developers in the wings licking their chops over the prospect of getting their hands on the power plant site and eventually the water and sewer plant site as well?

Whatever hidden agendas may be lurking in the shadows, it seems clear there is strong resistance from some to airing the full aspects of this deal in the sunshine for all to see and understand.

A citizen’s initiative now underway to amend the City Charter may be the one last hope for the public to be given an opportunity to vote on a complete sales agreement, as well as the exact terms of the land lease.

A group including Linda Hillman, Ken Daige and Charlie Vitunac has indicated it may begin gathering signatures as early as this week. If some 1300 city voters sign a petition the group is circulating, the Council will be obliged to hold a referendum on their proposed Charter amendment.