MARK SCHUMANN

In hopes of keeping alive discussions on Indian River Shores’ and Florida Power & Light’s request for a so-called partial sale, Vero Beach Mayor Jay Kramer today sent a letter to Indian River Shores Mayor Brian Barefoot containing what Kramer characterized as “a personal suggestion.” Kramer was quick to clarify that he is not authorized to negotiate on behalf of the City Council.

On behalf of the Shores, FPL recently proposed buying Vero Electric’s Shores customers base and associated infrastructure for $30 million, with $27 million to be paid by FPL and $3 million by Shores residents and businesses. Vero Beach officials have calculated it will take, not $30 million, but approximately $47.5 million to avoid putting the City, its taxpayers and remaining electric customers at risk of having to pay higher taxes and higher electric rates as a result of any such “partial” sale.

In a two-page letter to Barefoot, Kramer pointed out that the $3 million the Shores is proposing to contribute to FPL’s $30 million offer will, according to the Shores’ own estimates, result in a 2000 (two-thousand)  percent return on investment to the Town over the next 3o years. Kramer wrote, “From the perspective of the rest of the City’s electric customers, whom I represent, it appears that the Town wants to pay $3 million to get total benefits in excess of $60 million, while leaving our remaining customers with more than $12 million of additional fixed cost burden and with an additional risk of roughly $5 million associated with our ownership interests in the power plants that we effectively co-own to serve all our customers, including those in the Town.”

Kramer’s letter to Barefoot asserts that the City’s estimates could actually turn out to be low. “They (the City’s numbers) are, as our experts have said consistently, their best estimates of what it will take to keep the City, our citizens, and all of our other electric customers whole, and I am willing to support a transaction on this basis, relying on their estimates,” Kramer wrote.

Kramer went on to suggest that the Town, based on its own estimates of projected savings, could afford to put far more than $3 million into the deal. “I would ask whether the Town might consider contributing $20 million toward FPL’s purchase of our facilities and customers accounts in the Shores, such that the combined purchase price would be $47 million,” Kramer wrote, adding, “According to your assertions, this would provide net benefits to your citizens and businesses of at least $40 million…”