With negotiations stalled, is FPL now threatening to hold Vero Beach hostage?

COMMENTARY

“More troubling than FPL’s blame game, is the revelation that the company now appears determined to hold Vero Beach hostage to a purchase and sale agreement which by all accounts cannot be executed, but which also does not expire until Dec. 31, 2016.”

MARK SCHUMANN

In concert with the Vero Beach’s transactional attorneys, FPL strategists have pursued one failed plan after another for charting a “path forward” that would enable Vero Beach to sell its electric utility without breaching long-standing contractual obligations to the Florida Municipal Power Agency and its bondholders.

FPL’s latest proposal is to pay the FMPA $52 million to set aside important provisions in its contracts with Vero Beach and to absorb the City’s power supply obligations for three years.

Despite the FMPA’s rejection of this latest offer, FPL officials are pressing the City Council to approve their plan to charge half of the additional $52 million to Vero Electric’s customers.

What FPL spokesperson Amy Brunjes is calling “the FMPA penalty,” others see as something more like a bribe, especially considering that the Orlando Utilities Commission has reportedly offered to assume Vero Beach power supply obligations through the end of 2017 for some $46 million.

Though the transactional attorneys and their FPL counterparts have led Vero Beach down one failed “path forward” after another, FPL’s public relations team, led by former Scripps Treasure Coast Newspapers associate, Amy Brunjes, is now attempting to shift blame for the stalled negotiations onto the FMPA.

Just last week, Brunjes went before the Indian River County Board of County Commissioners seeking support for FPL’s proposed $26 million surcharge to be assessed the customers of Vero Electric. Brunjes spent much of her time before the Commission and the cameras attacking the FMPA, often through misrepresentations of the truth regarding the need for a ruling from the Internal Revenue Service on the tax implications of the sale. Essentially, Brunjes is blaming the FMPA for FPL’s failure to structure a deal that will not violate Vero Beach existing contracts.

More troubling than FPL’s blame game, is the revelation that the company now appears determined to hold Vero Beach hostage to a purchase and sale agreement which by all accounts cannot be executed, but which also does not expire until Dec. 31, 2016.

In statements made before the City Council and the County Commission within the past two weeks, Brunjes and FPL attorney Patrick Bryan both said that if the $26 million surcharge is unacceptable to City leaders, and if the FMPA rejects the $52 million offer, along with its accompanying stipulations and conditions, FPL will hold Vero Beach to the contract signed in Feb. 2013 by Tracy Carroll, Craig Fletcher and Pilar Turner.

By her own admission, though, Brunjes made clear FPL is not confident of closing the deal under the terms of the existing contract. More bluntly, City Manager Jim O’Connor described the original contract as a “dead end.”

Now that FPL is threatening to hold the City hostage, it is time for the City Council to seek outside legal counsel to determine what options the City may have. Further, because the transactional attorneys, who have to date cost the City some $1.5 million, are not in a position to assess their own shortcomings, any new counsel hired by the City should assess to what extent the transactional attorneys may have been negligent for allowing Carroll, Fletcher and Turner to sign a binding contract full of blanks and holes.