FPL offers to buy city’s Shores customers at short sale price

COMMENTARY

“Finally, no serious, responsible negotiating partner would do as FPL did yesterday and, out of the blue, send an offer letter simultaneously to their counter party and to the press. City Clerk Tammy Vock received the offer letter yesterday from FPL Vice President Amy Brunjes at 9:59 a.m. Just six minutes later TCPalm.com posted a story on the proposed deal. Press Journal reporter Colleen Wixon is either the world’s fastest writer, or she had FPL’s offer even before it was delivered to City Hall.” 

MARK SCHUMANN

Pontificating on Vero Beach’s power saga, “Press Journal/FPL” opinion columnist Larry Reisman recently wrote, “What headline would you like to read? ‘Rate cut 1.5 percent for Vero Beach electric customers.’ ‘Barriers overcome to sale of Vero Beach electric. FPL acquisition to lower rates 25 percent to 30 percent.’ It’s a no-brainer.”

Reisman’s latest column is another example of how he consistently fails to offer Press Journal readers balanced reporting on the power story. Who can blame him, though? His publisher is married to a key Florida Power & Light executive involved in the utility giant’s effort to acquire Vero Electric.

Reisman would do well to accept that there is nothing to be gained by continuing to pretend the 2013 purchase and sale agreement between Vero Beach and FPL can or will ever be executed. By their own admission, FPL officials acknowledge the 2013 deal is dead. Sure, they claim to have a rabbit up their sleeve, but they decline to be specific. FPL’s last bright idea was to saddle the customers of Vero Electric with a $26 million surcharge.

In his Wednesday front page column Reisman asserted that a rate cut of 1.5 percent for Vero Electric customers is “no big news.” How ironic, given that any similar announcement by FPL would surely have the Press Journal’s community editor and his colleagues all but wetting their pants in excitement.

Reisman did at least acknowledge that the city is making progress in renegotiating its wholesale power agreement with the Orlando Utilities Commission.

Apparently fearful a revised agreement with the OUC will enable Vero Beach to make meaningful reductions in electric rates, FPL officials yesterday announced they are prepared to pay $13 million to buy the city’s electric customers in the Town of Indian River Shores. Actually, FPL claims its offer is worth $25 million, with $12 million to be spent on upgrades needed to connect FPL’s transmission lines to the distribution system within the Shores.

Somehow, Vero Beach officials are supposed to accept FPL’s convoluted argument that the upgrades are a benefit to Vero Beach. It’s essentially the same hat trick FPL played when it tried to buy the full system for far less than it is worth.

In truth, FPL’s offer of $13 million is little more than a short sale price.

Looking ahead, if FPL peals off Vero Electric’s Shores customers now, what’s next? The south barrier island? Commercial customers west of 58th Avenue?  At what point would the sell offs leave the city in breach of its contracts with the Florida Municipal Power Agency? Just as importantly, what would the negative impact of downsizing be on Vero Beach’s remaining customers?

FPL’s $13 million, low ball offer to begin carving up Vero Electric reminds me of the story of the farmer, who, when questioned about his three legged pig, replied, “You wouldn’t eat a prize pig all at once now, would you?”

This last minute proposal by FPL is a calculated attempt to derail the efforts of Vero Beach leaders to lower electric rates. More importantly, the proposal would result in higher rates for the remainder of Vero Electric’s customers.  The unfairness of FPL’s offer is galling.

Speaking of gall, truly unmitigated gall, FPL Vice President of External Affairs Amy Brunjes, when asking to be heard at next weeks’ City Council meeting, “respectfully requested” to be placed first on the agenda.

Another objective behind FPL’s latest “offer” may be to influence the next Vero Beach elections. Expect the company to sponsor a slate of candidates committed to handing over the Shores customer base, and at a short sale price. I can already hear the FPL-planted question to be asked at the Tea Party and Tax Payers Association candidate forums. “Are you in favor of selling Vero Electric’s Indian River Shores Customers to FPL?”

The question that should be asked is, “Are you in favor of raising electric rates for most Vero Electric customers to give lower rates to Indian River Shores residents?”

Finally, no serious, responsible negotiating partner would do as FPL did yesterday and, out of the blue, send an offer letter simultaneously to their counter party and to the press. City Clerk Tammy Vock received the offer letter from FPL Vice President Amy Brunjes at 9:59 a.m. yesterday. Six minutes later TCPalm.com posted a story on the proposed deal. Press Journal reporter Collen Wixon is either the world’s fastest writer, or she had a copy of FPL’s offer letter even before it was delivered to City Hall.

In response to FPL’s attempt to peal off Shores customers at a fire sale price, the best response from Vero Beach leaders would be to thank the company’s representatives for their effort, set the pitiful offer aside, and then move on to striking a new deal with the OUC.

Rejecting FPL’s latest “offer” is, as Reisman would say, a no-brainer.