Initially, the Shores Town Council earmarked $10,000 for its legal battle with Vero Beach. By the end of October, the Town had spent $626,7456 with two law firms and a public relations firm hired to work on the case.
MARK SCHUMANN
Circuit Court Judge Cynthia Cox yesterday dismissed three of four counts in the Town of Indian River Shores’ lawsuit against Vero Beach. Judge Cox let stand for further litigation the Town’s complaint that Vero Electric’s rates are unreasonable.
If the Town chooses to pursue count three in its lawsuit against Vero Beach, the Town’s attorneys must, if they are to prevail, demonstrate that Vero Electric’s rates are unreasonable and are not set in accordance with industry standards.
Some observes see Judge Cox’s ruling as a major victory for Vero Beach, for the Shores’ claim of unreasonable rates, they say, has no basis in fact or law. Vero Electric’s rates are below those charged by three of the state’s five regulated investor owned utilities, they point out. Further, Vero Beach’s rates are also below those of a number of other municipal utilities in Florida.
The legal action, which has so far cost Indian River Shores taxpayers more than $600,000, was initiated by Mayor Brian Barefoot and the Town Council, and has been championed by the island weekly, the Press Journal, Vero Beach City Councilwoman Pilar Turner, newly elected Councilman Harry Howle III, as well as by local utility activists.
In several press releases issues since the Shores filed it’s lawsuit late last summer, Barefoot has insisted the Town, not the Florida Public Service Commission, has the authority to determine which electric utilities will serve the Shores. Barefoot repeatedly assured Shores taxpayers their money was being well spent in pursuing the case against Vero Beach.
Judge Cox disagreed. “Although artfully argued otherwise, the actual relief sought by the Town amounts to an unfeasible request that the court determine what utility will provide electric service to the Town. This determination already has been made by the PSC in the Territorial Orders.”
In a statement released Feb. 2 Barefoot wrote, “We have never questioned the PSC’s authority with regard to approving territorial agreements, and instead have focused our lawsuit on a unique situation in which the City of Vero Beach is claiming extra-territorial powers to encroach and serve within our Town’s corporate limits without our consent,” concluding, “…we are fully prepared to move forward with our litigation in Court.”
On Feb. 27, Barefoot wrote, “Our lawyers assure us that they are ready to go.”
On July 20, Barefoot issues a statement in which he wrote, “At its core, this lawsuit is about the Florida Constitution, the Municipal Home Rule Powers Act, Section 180.02(2), Florida Statutes, and the rights and responsibilities of the Town and City under a Franchise Agreement that is scheduled to expire in less than two years. It is about settled constitutional and statutory principles that respect the equal independence of municipalities by limiting the exercise of extra-territorial municipal powers.”
By dismissing count one in the Shore’s complaint, Judge Cox reaffirmed the PSC’s authority over electric service territories, and at the same time rejected the Shore’s claim that the Town essentially has more authority than the Florida Legislature. In 1974 the Legislature passed the Grid Bill, vesting the PSC with superior and exclusive authority over electric service territories.
In count two, the Shore’s asserted that Vero Beach was planning to breach its franchise agreement with the Town by insisting it would continue to provide electric service after the agreement expires next year.
Vero Beach’s lawyers argued the franchise agreement simply gives the Town Council the right to authorize the collection of a franchise fee, something the property-tax-rich island enclave has chosen not to do. The Indian River County Commission, in contrast to the Shores, assesses a six percent franchise fee on all electric service provided in the unincorporated areas of the county.
In dismissing count two, Judge Cox wrote, “The Franchise Agreement does not address the effect of its expiration and there are no provisions in the Franchise Agreement which call for the City to remove or relocate its electric facilities or cease providing electric service to the Town upon expiration.”
In its fourth count against Vero Beach, Shores officials argued the unreasonableness of Vero Electric rates are egregious, and thus warrant the branding of declaratory relief by the courts. Judge Cox rejected the Shore’s final plea. She wrote, “Determination of the breach of contract claim in Count III involves the same factual dispute as the claim for declaratory relief in Count IV, namely whether the City’s utility rates are unreasonable and, if so, to what extent…Because the Town’s claim for declaratory relief is subsumed within its claim for breach of contract, Count IV for declaratory relief should be dismissed with prejudice.”
By choosing to challenge Vero Beach in court, Shores leaders took a different, and far more expensive line of attack on the City than has the Indian River County Commission. The County first brought its claims to the PSC, which ultimately rejected the assertion that the Indian River County Commission, and not the PSC, has the responsibility and authority to determine electric service territories within Indian River County.
The County appealed the PSC’s ruling to the Florida Supreme Court. A decision is expected in December.
Indian River Guardian 
Looks like Mr Barefoot has been stepping on some very hot and painful coals in the Indian River Shores lawsuit against the city. I suggest he and the Shores council quit now and avoid further embarrassment and loss of taxpayer monies. Three of four charges are dismissed by Judge Cox for good and sound legal reasons. Quit now in order to escape “egg on your face” before the final verdict is given. The county commissioners should take note and save all of us time and money.
What, and not have an exciting and “juiced up” front page story for the beachside fish wrapper?
Heavens forbid!
What I want to know is how is it even legal to make county citizens use city of Vero beach electric utility even though the legally live in the county? Also how is it legal to not even give them rights to be able to vote on how the city utility is used?
Brian, I bet the the fish wrapper tabloid will not run the story,but if they do, let’s see how they twist and turn this loss into a victory. A sad day for Barefoot and Benji. May there be many more.
Wes, I assume you genuinely want to know the answer to your question. That answer can be found in the court ruling of yesterday, and in the PSC ruling of several months ago. The answer can also be found in the 1974 Grid Bill, legislation to which both the PSC ruling and the court ruling refer.
Wes, the above story is neither news analyst nor commentary. It is simply a factual report on the Judge Cox’s ruling. Here is another fact that may or may not be worth considering. Approximately one-third of the 7.5 million residential electric customs in Florida served by utilities regulated by the Florida Public Service Commission are currently charged rates equal to or higher than the rates charged by Vero Electric. If you doubt me, just but the question to the fine folk at Florida Power & Light, who have done such a masterful job over the past few years of convincing so many customs of Vero Electric that they are used, abused and neglected. The facts are what they are.
One way to have a voice in the running of Vero Electric is to accept annexation into the City. By far, the biggest mistake ever made by Vero Beach leaders was made many years ago, when utility services were extended beyond the city limits. If the City of Vero Beach had not be willing to offer electric and water and sewer service to the north and south barrier island and to some neighborhoods on the mainland, those areas would, today, remain undeveloped, or the residents there would be burning candles and using outhouses. The current complaints of those, who for decades have been well served by Vero Beach’s utilities, is an example of ingratitude beyond measure.
Vero Beach is entitled to a fair return on their very wise investment they made years ago. Can anyone tell me why the county collects a franchise fee for doing nothing. If I lived in the county ,I would seek to have my section of the unincorporated parts of the county be annexed by the city. In fact, the city has stronger laws in many areas such as our short term rental laws. Why not ask the commissioners why they did not enact laws to prevent short term rentals. i think we all know the reason, don’t we.
John, the City is also taking a position to save the lagoon and the county is not. Just another good reason for annexation. The County Commissioners have let their residents down on a lot of current issues. I elected officials in the Shores are arrogant to think that they can win this battle. They are not only costing their citizens a lot of money, they are costing Vero Citizens a lot of money to fight back. Big winners, the attorneys – big losers the taxpayers.