Reader Comment: Shores residents being ‘milked’

Related Story: Civic Association calls for referendum on partial sale

Larry Wapnick writes:

“All of you are correct, but remember what got all of us into this mess. Bad decisions many years ago by elected former city council members. Since then we have all paid the price, but unfortunately the present residents of Vero are “holding the bag” and must do the right thing. Continuing to “milk” Indian River Shores Residents benefits the city, but it is wrong! Yes the new council members were voted in, the voters knew their platforms, and have owned up to doing the right thing. Let us move on, we will all survive. We will all support the city, and perhaps with lower electric rates be able to support it even more.”

InsideVero response:

One: The “bad” decision made years ago by former city council members that led to this “mess” was the initial agreement to serve the Shores with utilities. The second decision that led to this season of discontent, in which some Shores residents are customers of Vero Electric and other customers of FPL, was the Shores Town Council’s annexation of area north of the original Town limits.

Two: Vero Beach has not “milked” you or any other Shores electric customer. When those who wanted to develop the area of the island now known as Indian River Shores came to Vero Beach requesting utility services, they were well aware that Vero Beach does what nearly all other municipalities do in earning a percentage of its utility revenue as a return on investment/equity. Unlike FPL, Vero Beach does not use its earnings to pay multi-million dollar salaries to top executives. Rather, the money goes to outfit police cars with defibrillators, to pay municipal employees fair wages, to guard public beaches, to maintain the parks and other facilities Shores residents regularly enjoy at no cost.

Three: Despite what Robert Auwaereter claimed when he went before the Florida Public Service Commission to speak on behalf of the Shores and against the City of Vero Beach, Vero Electric’s rates are not excessive, abusive, unreasonable, or monopolistic. In fact, Vero Electric’s rates are lower than those already approved by the PSC for three of the state’s five investor-owned utilities. Further, since the troika of Tracy Carroll, Craig Fletcher and Pilar Turner was broken up in late 2013, Vero Electric’s rates have steadily declined, and are expected to come down further in the near future. For example, the current fiscal year budget includes $700,000 to decommission the power plant. Those are one-time costs, so unless the new troika of Harry Howle, Laura Moss and Lange Sykes messes things up, rates can likely come down at least $700,000 in the 2017/2018 fiscal year.

Four: While Vero Electric’s rates continue to decline, FPL just received PSC approval for a rate increase of nearly $900 million. Further, though FPL and its allies like to quote the company’s base rate on 1000 kilowatt hours per month, they make no mention of the fact that FPL’s rate structure is tiered, and includes peak use charges. Consequently, you will likely not save nearly as much as you are expecting to, if and when you become a customer of FPL.

Five: Of all the points you made, the one I most disagree with is your assertion that “the voters knew their platforms,” when they voted for Moss and Sykes. Moss and Sykes were supported by a Shores-FPL funded political action committee that spent some $100,000 disseminating flat-out lies. The Shores-FPL funded misinformation campaign carried out by the PAC served to greatly mislead the voters of Vero Beach. In addition to making outrageous claims about how the proceeds from the proposed partial sale could be used, the PAC, and the Moss and Sykes themselves, led voters to believe their “platform” is to bring lower rates to everyone. That is simply not true. What they propose in the short run is a carving up of Vero Electric at the request of the Shores that will lead to higher rates for every one of Vero Electric’s remaining residential and commercial customers. Because the island weekly and the Press Journal are led by publishers who have their own agendas, Vero Beach voters were not properly informed that Moss and Sykes were almost entirely funded by Shores residents, and are members of what Shores Mayor Brian Barefoot describes as “the Shores team.”

Six: The claim that the proposed partial sale of Vero Electric’s Shores customers to FPL now is somehow “in the context of a full sale” is nothing but public relations babble. What does this really mean? Nothing, absolutely nothing! There is no clear path to a full sale. There just isn’t. This talk of a partial sale for the Shores being “in the context of a full sale” is only intended to mollify the people of Vero Beach long enough to get the Shores deal done. The promises Harry Howle, Laura Moss and Lange Sykes have made about finding a way to sell the remainder of the electric system, and at a fair price, are empty promises.

8 comments

  1. Dearest Mark, we can spin anything in any direction we want to. However, since the additional fuel cost increases were never adjusted on our electric bills even when the cost of fuel came down, I point to that as “Milking the Cow”! We were happy with the electric rates since the beginning of our joint venture, the service was excellent, everyone was happy, THEN WHAT HAPPENED????? The City continued to profit on the “FUMES” of the previous gasoline prices and we all got taken advantage of, yes we,and the City residents. We never mention any of the savings on more efficient appliances such as air conditioners, home appliances or other items that FP&L rebates on, but not the City. If consideration was taken we would like to remain customers of the City, as the City dwellers would, but let’s face it, when it comes to throwing away money none of us are that stupid, save some elected officials!

  2. Larry, you know I respect you, AND I also completely disagree with you on this. You point about unadjusted fuel costs is a new one. But as they say, “I mind changed against its will is of the same opinion still.”

  3. Larry, you are flat out wrong. You use electricity you pay for it, just like everyone else and at the same rate.
    Thank you Mark for telling it as it is.

  4. Dear Mark, if you check into the validity of my statement of “fuel costs” you will verify that I am correct. My biggest problem is that I remember too many trivial things that happened in the last 65 years and I count that as an asset, however in this case no one wants to remember it!

    Judge Jeanette, I would be happy to pay for the electricity that I use, but fuel costs from 7 years ago are no longer justified.

    Anyway, Mark, thank you for an honest blog where everyone can be read, whether we agree or disagree, traditionally both you and your family have provided all residents of IRC that gift and it is a pleasure to see it continued.

  5. Larry, I don’t think that “that gift’ which was provided for so many years at the VERO BEACH PRESS JOURNAL by John J.Schumann and John J. Schumann, Jr has been continued by the INDIAN RIVER PRESS JOURNAL today.

  6. Here is an interesting read: Critics say Florida utilities are building ‘unnecessary’ gas infrastructure for profit while customer foot bill – https://www.desmogblog.com/2016/12/18/critics-say-florida-utilities-are-building-unnecessary-natural-gas-infrastructure

    According to this article, FPL’s profit is 11.5% on their rate of $89.27 per 1000 kWh. That comes to $10.44 per 1000 kWh. Vero Electric’s profit is 6%. On the current rate of $116.08, that amount to $6.98 per 1000 kWh. The national average is 9.5%. Vero Beach is below the national average, FPL is above it. So when it comes to profit margins, who’s doing the milking? One could reasonably argue FPL is the company seeking exorbitant profits.

    A couple of letters to the editor published by TCPalm.com addressing FPL recently receiving Florida Public Service Commission approval for a rate increase of more than $800 million make the following points.

    “If all the “great” things Gould (FPL’s chief communications officer) said FPL has been doing to make the utility more efficient, that in itself should be increasing their profit margin and a rate increase would not be required, right?” – Elmer C Meiser, Jr., Sebastian

    “Recently someone from FPL wrote to justify the recent rate increase granted to the utility. The main gist of his argument was that FPL rates are lower than those of competing utilities and that, basically, we should be grateful for that.

    “So what. They should be lower! An examination of the population that FPL serves will indicate that the per capita income is lower than other Americans and that there is a preponderance of retired persons on fixed incomes within their domain. So they have an inherent responsibility to keep their rates as low as possible, practice all economy, and minimize any and all increases.” – Rich Hamilton, Port St. Lucie

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