Editor’s note: Newly elected Vero Beach City Council members Laura Moss and Lange Sykes received the vast majority of their financial support from Indian River Shores residents. Seventy percent of Moss’ contributions came from Shores interests. Sykes received 90% of his campaign funds from residents in the neighboring community. Both Moss and Sykes were supported by a political action committee that received $55,000 from Florida Power and Light, and another $60,000 from Shores residents. Moss and Sykes have now joined with Councilman Harry Howle in supporting a sale of Vero Electric’s Shores customers to FPL for $30 million. A team of five independent utility experts determined it will take, not $30 million, but $47 million to keep the proposed sale from leading to higher electric rates for the remaining customers and higher taxes for the residents of Vero Beach.
In a memo written Nov. 22, Florida Municipal Power Agency staffer, Amanda Swindle, summarized the Vero Beach City Council’s discussion of a partial sale of the City’s Indian River Shores customer base to Florida Power and Light, as well as the termination of special utility counsel, Schef Wright.
Unlike the local press, namely the Press Journal, Swindle took note of Councilman Richard Winger’s effort to persuade the new Council majority to submit the proposed sale to the Finance Commission for review.
Below is the full text of an internal FMPA memo distributed to staff and members of the association’s board of directors and executive committee. The memo is a pubic record.
Vero Beach City Council Meeting – 11/22/16
The Vero Beach City Council met on Tuesday, November 22, at 9:30 a.m. This was the first City Council meeting after the November election. Laura Moss was nominated to serve as mayor, with Harry Howell designated as vice-mayor, for the 2016-2017 term. Later in the meeting Laura Moss was named as the Vero Beach representative to the FMPA Board. Two items on the agenda were of relevance—(1) “Discussion of Partial Sale (Vero Electric),” and (2) “Discussion to consider halting the service of Schef Wright.”
(1) Discussion of Partial Sale
Mayor Laura Moss requested a discussion of the partial sale of the Vero Beach Electric (“VBE”) customers residing in the Town of Indian River Shores to FPL. Vice-mayor Harry Howell also requested to discuss the partial sale under the topic “Invite Florida Power & Light (FPL) back to the table for the purpose of continued and negotiation of the sale of Indian River Shores (IRS),” so both topics were combined for discussion. It was made clear that a majority of the new council was in favor of pursuing the partial sale based on the last offer made by FPL for $30. Councilman Richard Winger restated his objection to a sale that would not leave the remaining VBE ratepayers whole. He said that while he believed the $47M number reached by Vero’s team of consultants, including Schef Wright and Bill Herrington, was the right number, he would be in favor of having new experts take a second look. Councilman Tony Young agreed with Winger, and wanted to see the issue go before the Vero Beach Finance Commission. However, Councilman Lange Sykes joined Mayor Laura Moss and Vice-mayor Harry Howell in the opinion that the partial sale had been delayed too long already.
After hours of council and public discussion, two motions were passed. The first was made by Mayor Laura Moss as follows: “Within the context of a full sale of Vero Beach Electric to FPL, Vero Beach will consider in good faith the sale of Vero Beach Electric customers residing in Indian River Shores to FPL.” Richard Winger requested that the motion be amended to add “as long as the ratepayers are kept whole,” but Moss refused to amend because she thought the language was too subjective. After discussion, the motion was amended to add that consideration would be for the last offer made by FPL on August 9, 2016. The motion passed 4-1.
The second motion was made by Vice-mayor Howell as follows: “To ask FPL to draft a non-binding Letter of Intent reflective of the last offer to purchase the Indian River Shores customers to be voted on at the next City Council meeting.” Amy Brunjes, a spokesperson for FPL, was asked if FPL could have the draft completed by next Wednesday, which is the deadline for the next council meeting’s agenda. She said that would not be a problem. Councilman Winger reminded the council that the offer had never been reviewed by the Vero Beach Finance Commission, but the motion passed 4-1 to request to nonbonding Letter of Intent. City Manager Jim O’Connor told the Council that Jacob Williams from FMPA had informed him the previous night that FMPA would support the partial sale.
(2) Termination of Schef Wright
Attorney Schef Wright was hired on April 15, 2014, to work on issues including the full sale of VBE to FPL, renegotiation of Vero’s PPA with OUC, and the various court and PSC proceedings initiated against Vero Beach by Indian River Shores and Indian River County. At the time he was hired, then-councilman Pilar Turner questioned whether Mr. Wright’s hiring was to “appease FMPA.” Most recently, Mr. Wright helped work on determining the amount at which Vero could sell its Indian River Shores customers while not having to raise rates for the remaining customers. Mr. Wright presented his recommendation for a partial sale at $47M to the Vero Beach City Council on August 16, 2016. At that meeting, the council voted to counter FPL’s $30M offer at $47M, which FPL declined.
Vice-mayor Howell stated that Mr. Wright’s failure to accomplish the partial sale demonstrated that he did not have the best interests of Vero Beach in mind and that Howell made a motion to terminate Mr. Wright and seek new legal counsel. Mayor Laura Moss and Councilman Sykes agreed that they had no confidence in Mr. Wright’s ability to complete the partial sale. City Manager Jim O’Connor stated that he would like the flexibility to continue using Mr. Wright’s services, particularly to complete the pending PSC and court proceedings and to bring a new attorney up to speed, which would save time and resources by not “reinventing the wheel.” However, Vice-mayor Howell expressed concern that Mr. Wright would exert too much influence on the new counsel, and stated that he would be fine paying “even two times the rate that Schef charges “because a new attorney would move things forward.” The motion passed 3-2.