COMMENTARY
MARK SCHUMANN
In an editorial published Sunday, March 23, the Press Journal misstated several key facts regarding the power sale negotiations. Writing on behalf of the Scripps Treasure Coast Newspapers editorial board, the author asserted, “It sounded so simple.”
In truth, no one involved in the power sale negotiations has ever suggested there is anything simple about the deal.
The author of the Press Journal’s editorial then went on to claim, “The major sticking point has been resolved.”
In truth, the transactional attorneys have charged some $1.5 million dollars to pick the low lying fruit, while the city’s major contract issues with the FMPA remained unresolved
The Press Journal editorial board apparently believes, or wants its readers to believe, that the proposed $52 million payment would “allow the city to free itself from contractual obligations with FMPA.”
In truth, the $52 million payment, at least according to FMPA General Manager Nicholas Guarriello, would simply compensate the agency for absorbing for three years some 38 megawatts of Vero Beach’s power entitlements the FMPA neither wants nor needs. The $52 million, according to the FMPA, in no way addresses the city’s contingent liabilities and stranded cost issues with the FMPA.
“…the power agency has yet to decide whether to accept the $52 million to allow the city to exit its contracts,” the Press Journal’s editorial writer claimed.
In truth, the FMPA has made it crystal clear FPL’s $52 million offer, with its many conditions, is “unworkable and unacceptable.”
Todays’ Press Journal editorial is just the latest example of how Scripps Treasure Coast Newspapers is offering its readers narrow and simplistic reporting on the power sale.
Again today the Press Journal published the following disclaimer. “Bob Brunjes, president and publisher of Scripps Treasure Coast Newspapers and a member of its editorial board, is married to an FPL executive. He recuses himself from discussions involving FPL.”
Though Brunjes may “recuse” himself from discussions involving FPL, that does not mean his colleagues are able to set aside their knowledge of their publisher’s personal interest in the success of his wife’s career.
Indian River Guardian 
It started at Vero’s council meeting with Charlie Wilson berating the mayor,and then Glenn Heran trying to “strong Arm ” councilwoman Amelia Graves. Next came the letter to FMPA by Scott Stradley. Today we have an editorial from the Press Journal pushing its pro sale agenda. Does anyone believe the editorial board of the PJ operates in a vacuum ,or without direction? These are not isolated events . These are all coordiated events probably orchestrated by the PR Dept of FPL. Somewhere along the way FPL screwed up, and as long as FMPA will not meet with them there is no deal. FPL in a panic mode .
Where everyone except for the two no votes (Winger and Kramer) went was to sign a sales agreement with no knowledge of what the exiting costs and liabilities were, or knowing what these figures were but withholding them from the voters. If the truth was made public, FPL could have never had the yes votes in the referendum. It was better to get the agreement signed producing unattainable financial gains and then play the blame game.
Lets face it, this rag has one motive, to convince the voters of Vero Beach, that paying $25,000,000.00 more in electric rates than FPL would charge is a great deal. This paper is anything but journalistic, it is a opinionistic at best. The Kremlin runs a paper similar to this, where all articles are written by the Comrads. At least TC Palm gives both sides to a story.
The Opinionist Columnist of this paper like Mark Schumann have a vested interest. They own commercial properties, live outside the city and prefer for the electric rate payers to subsidize their investments by paying half their property taxes. That helps explain their blind support for not selling the electric utility, and keeping the least able to pay, paying THEIR property taxes through electric bills.
It is a great scam, shell game, transfer of wealth from the poorest to the richest I have ever see.
So, even if FMPA lost its mind and accepted the $52 million from FPL ($26 million of which would be repaid to FPL by the COVB Electric Customers (or just COVB residents?), after the 3 years, we’d be where? Between rock and hard place? Standing at the top of a lighthouse ready to jump? Ready to take a long walk into the Atlantic? Begging on every street corner?
The $26 million would be paid by all 34,000 customers of Vero Electric. However, there may be other as yet unidentified costs. One question is who should pay those costs, just the City’s taxpayers, or the 34,000 customers of Vero Electric?
I do not see the logic of your assertion that owners of commercial properties, whose businesses occupy their buildings, would want to retain Vero Electric simply for economic reasons. For example, the city property tax on my wife’s commercial property in downtown Vero Beach is $759.61 for the current year. Her electric bill is approximately $7,200 a year. Assuming even a 20 percent rate differential between Vero Electric and FPL, she will save $1,800 on her electric bill. Even if her city property taxes doubled as a result of the sale, she would still be ahead some $1,100 a year as a result of a sale. So, I just don’t get your point.
I opposed the signing of the current purchase and sale agreement between the city and FPL because I believe then, as I believe now, that the agreement cannot be executed until late 2016, if at all.
There is no justification then for not selling Vero Electric.
1. The rates are 38% more than FPL.
2. The rate payers are charged $25,000,000.00 a year for the same electricity than from FPL.
3. The city will release itself from untold millions and millions in liablity.
4. The employees will be given a job with FPL
5. The site of the plant is a gem, for civic, or commercial development.
6. Taking the Electric Operation decisions out of the hands of the council, who have proven they are inept at best, just look at the contracts we are paying millions to get out of.
7. The $56,000,000.00 FMPA hostage ransom payment is an interest free loan, to be paid back over a 3 or 4 year period.
8 While paying back the hostage ransom payment to FMPA over a four year period the savings would be $100,000,000.00 – $26,000,000.00 for a net savings of $74,000,000.00
Please explain to me how this is not a good deal. Please explain to the any other viable option that would reduce electric rates 25% forever.
Remember a few years back when electric rates were 57% more than FPL
Remember we are paying $25,000,000.00 a year more now.
If sold we will save $25,000,000.00 a year minus what ever FMPA adds to the hostage ransom they are demanding.now, which is $52,000,000.00 half of which FPL is paying and the other half are giving the rate payers a interest free loan for, to be paid back over 4 years.
My point is, there is no option out there that would stop this insanity from continuing except a sale to FPL. I
You have done a good job of presenting the pro-sale talking points.
One reason not to sell the system would be if the proposed transaction proves impossible from a legal stand point.
The amount of the proposed payment to the FMPA is $52 million, not $56 million. More importantly, the proposed payment is to compensation the FMPA for absorbing Vero Beach legal obligations to buy power from power projects in which the city is a member. Another alternative would be to pay the Orlando Utilities Commission to take on that power for three years. I am told the OUC offered to absorb Vero Beach’s Stanton I and Stanton II power entitlements for $46 million. If FPL is willing to pay $26 million, that would leave another $20 million to be paid over three years by the customers of Vero Electric. Why doesn’t someone ask FPL representatives why they are not taking the OUC offer at $46 million? That deal would save the customers of Vero Electric $6 million.
If and when it becomes clear the transaction FPL and the city’s attorneys have structured cannot go forward, it will be interesting to see how quickly the concept of a partial sale will be embraced by those who now dismiss it out of hand.
None of which is a reason to stop this sale. That is merely a negotiating point. The only reason this sale will not go through is:
1. The city council stops it, Kramer, Graves and Winger.
2. FMPA tries to stop it, which will prove to be a big mistake on their part. The mismanagement and hundreds of millions lost by them should be made public to the people of Florida. That would be something a real journalist would dig into, if we could find one.
3. FPL walks, which would be a disaster for this City as you are well aware.
Believe what you choose. The fact remains that what cannot be done legally cannot be done. Time will tell whether there is a way to structure a sale that works for all parties.
I prefer to be an optimist when it comes to this sale. I believe right will eventually win over wrong.
That is one of my concerns with Mayor Winger going to speak with FMPA. He goes with an attitude of doubt and a lack of confidence in his mission.
The site of the power plant may not be a gem. It could possibly cost the taxpayers of the city millions of dollars once a clean up is ordered. I did not hear one pro sale person say county residents should help pay for this invitable clean up. FPL is getting a sweet heart deal: well below the real market value of Vero Electric.
You say that you prefer to be optimistic, but wishful thinking is not a strategy. We could go back and forth until the purchase and sale agreement between Vero Beach and FPL expires on Dec. 31, 2016.
You also say you believe right will eventually prevail, but how can you be so sure what is right? Who appointed you the final arbitrator of right and wrong? Have you considered that the bond trustees representing investors in the FMPA’s tax-exempt bonds, who are responsible for protecting investments made in good faith, believe they are acting in the right? Even during the great world wars, chaplains on both sides of the lines of battle called upon the same God for grace, guidance and protection. So, don’t be so confident you can, in the larger sense, divine right from wrong.
Mayor Winger cannot afford the luxury of governing from the pink cloud upon which you have chosen to perch.
Finally, since you raise the subject or property ownership, I notice that you and your wife own a home well west of the city, just northeast of the intersection of 41st Street and 66th Avenue. Do you happen to own a business in the city? What stake to you have in this outcome? If you are a non-stakeholder, at least in a direct sense, then I find it interesting that you are so dismissive of the interests of others who do, in fact, have a direct stake in this, including the taxpayers of Vero Beach, who are facing cuts in serves and/or higher property taxes, and the creditors of the FMPA and the FMPA’s other member cities, who are not interested in seeing the credit worthiness of their bonds downgraded simply because you and others insist walking away from contractual obligations is the “right” thing to do.
The city has put the burden of property taxes on the rate payers in the scam they are running. The out of city rate payers have paid more than the city on all these foolish contracts the city has gotten into.
Remember you said, property taxes are not that high, in the state of Florida, Vero Beach, which has government buildings, police, parks, etc. has one of the lowest tax rates. What would it be without the captive county rate papers.
Assess the property value of the utility and charge the same millage that property tax payers pay and stop the transfer from the utility. The electric rate payers pay more to the general fund than the property owners do, in the property tax through electricity shell game. Stop being cruel and unfair to those with the least ability to pay. Take the onion skins off your eyes man!
Accusing the city of running a “scam” is not helpful.
In truth, the city transfer 6 percent, or approximately $5.5 million, of its electric system revenue directly to the general fund. This transfer constitutes a “return on investment.” Of the $5.5 million, approximately $3.3 million is paid by out-of-city customers. City property taxes total just over $4 million. Corresponding with you is like debating with a high school freshman who has his facts wrong.
You didn’t answer the question about what stake you have in this decision. If you don’t own property in the city and if you are not a customer of Vero Electric, please explain your interest.
I know its hard to believe the city electric web reaches this far out of the city, but it does, and I am paying for your property taxes through my electric bill just like the 34,000 other electric rate payers.