MARK SCHUMANN

Moody’s Investor Service yesterday affirmed the Florida Municipal Power Agency’s A1 rating on its Stanton Revenue Bonds.  At the same time, Moody’s raised cautions about the proposed sale of Vero Electric.  The Moody’s report explained that the rating agency believes and expects any sale of Vero Beach’s electric utility will, “be structured in a way that fully protects bondholders’ rights under the bond resolution.”

The Moody’s report reiterated the FMPA’s position that the current structure of its project contracts protects participants and bondholders.  “Any challenge to the take-or-pay contractual obligation of participants and/or degradation in credit quality of the Stanton Project participants would likely change the rating down.”

Among the challenges the FMPA faces, Moody’s wrote, is “protecting bondholders rights as Vero Beach considers sale of its utility assets to FP&L.”

At Tuesday’s Council meeting, FPL attorney Patrick Bryan said the city’s proposal to secure its contingent liabilities with a pledge of the utility tax and franchise fee to be collected from 12,000 customers, rather than from the revenue from 34,000 customers, was a fair and reasonable proposal.

In his March 5 letter to FPL President Eric Silagy, FMPA General Manager Nicholas Guarriello reiterated the agency’s position that Vero Beach has yet to present a proposal for securing its contingent liabilities complete enough in detail to be considered from a business and legal perspective.