BY KEN DAIGE

The OUC Fuel Agreement is just a fuel agreement. It contains remedies to protect each party, the City of Vero Beach and the Orlando Utilities Commission, in the event of a breach of agreement.

The option to change fuel providers gave Vero Beach time to consider other future options while disengaging from other utility agreements.

The January 2006 city council, after considering other options including selling the electric utility, powering-up the city system and buying power on the open market, voted to find a power provider and enter into a long-term wholesale power agreement.  The OUC was willing to do 20-year deal with a 10-year back-out option as opposed to a standard 30-year wholesale power agreement. A request for proposals was issued, and negotiations had begun when I was elected to the city council in March 2006.

In 2008 the agreement between the city and the OUC was approved.

A reporter from an island weekly recently called about penalty clauses they believed were within the fuel agreement. I explained that they were stop-loss-clauses not penalty clauses, and I asked them to email me where they found the word “penalty” in the fuel agreement.

Two years earlier I had requested then acting city attorney Wayne Coment to review the fuel agreement and see if the word “penalty” was there. Coment did not find the word “penalty” in the agreement, because it is not there.

In early 2009 utility activists claimed that penalties were later inserted to prevent the city from exiting the fuel contracts. Former Mayor White clearly states in a recent InsideVero.com story that the provision in question is intended to protect either party in the event of a breach of agreement.

In late 2009 the State Attorney’s office conducted an investigation, based on an anonymous complaint, that looked at the city’s decision to choose a new power provider, the selection of the consultant, the bidding process and the selection of the power provider. There was never a call for the grand jury to review the complaint but after being presented with the information, they voted to take no action.

State Attorney Bruce Colton said the investigation determined the process was conducted fairly and properly and that no one was given an advantage over anyone else.

In November 16, 2009 and February 2, 2010 the city had consultants who worked on the 2008 contract come to a meeting to answer questions related to the agreement.

The island weekly reporter phoned and then sent the following email on March 24, 2013.  The same day the daily newspaper also reported that an investigation had already been conducted previously and no action taken in 2009.

The island weekly reporter wrote, “So here are my two questions. As you have requested, I attempted to state them as clearly and succinctly as possible: 1) Were either the $20 million or the $50 million default clauses (on page 19 of the April 2008 OUC agreement) put in the contract by the city in order to prevent Vero Beach from exiting the contract for the purpose of selling the electric utility? 2) On the day in April 2008 that you, as a member of the Vero Beach City Council, voted to accept the OUC wholesale power contract as it had been presented to you, was retaining ownership of the Vero Beach electric utility long-term a factor in your approval of the OUC deal?”

In a March 27 email I asked the reporter, “Have you already submitted your story for the press?”

I also asked, “Where do you see the word “penalty” in the fuel agreement?”  Further, I questioned how they concluded the liquidated damages provision was included in the contract in order to prevent the city selling its electric utility?

The same reporter emailed that day, “There is a story in this week’s paper. We are planning a follow-up story on April 4 and your answers would still be very helpful in the follow-up story.”

They also responded, “Obviously, the text of my question is not in the city’s agreement with the OUC. As we discussed on the phone I am trying to determine the thought process — specifically your thought process — as to why the $20 million and $50 million default clauses are in the OUC contract (which I sent you as an attachment and sent you a link to access from the city website).”

The reporter repeats themself to try to achieve a particular response that fits their belief system about the fuel agreement and sale.

From March 24 to March 27 the reporter switched from using the word penalty to default, at least in their email communications with me.

Yet, when the story appeared last Wednesday in the island weekly, they were still referring to a “penalty” clause. And we have no way of knowing if previous city council members were misquoted in that article. The reporter continues to state opinion as fact using phrases such as “privately indicated” and “allegedly admitted at a cocktail party.”

Questions have been asked and answered. Investigations have been conducted.

There was no hidden agenda to ever prevent a sale of the electric system.