Finance Commissioners raise questions about power sale

NEWS ANALYSIS

“I share the concern of many ratepayers that the proposed purchase price of $185,000,000 may be insufficient.” – Dan Stump

“Sykes claims executive experience. In truth, the company he ran was a one employee, home based business. Similarly, Howle and Moss lack the financial experience to conclude a nearly $200 million transaction without advice and input from members of the City’s advisory commissions. Lacking that vital input, they could at least use some courageous guidance from O’Connor.” 

MARK SCHUMANN

Glen Brovont
Dan Stump
Peter Gorry

Vero Beach City Council members Harry Howle, Laura Moss and Lange Sykes last week voted to forbid the Finance and Utilities Commissions from discussing, reviewing, or analyzing the proposed sale of Vero Electric. (Like former Council member Tracy Carroll, Howle, Moss and Sykes all benefited from substantial campaign contributions from Florida Power & Light.)

Clearly displeased at being muzzled, Finance Commission Chairman Glen Brovont wrote to City Clerk Tammy Bursick, “While censorship may be in vogue, a finance meeting should be scheduled as soon after receipt of the budget data.” He added, “Even dictatorial societies found while the mouth may be shut, the brain can still question and think.”

Even Commission member Dan Stump, who headed a political action committee that raised and spent more than $100,000 supporting Moss and Sykes, is now calling for negotiation of the purchase price of Vero Electric. In an email to City Manager Jim O’Connor Stump wrote, “I share the concern of many ratepayers that the proposed purchase price of $185,000,000 may be insufficient.”

Harry Howle

To date, there have been no real negotiations, for the purchase and sale agreement is being drafted around the original offer of $185 million made by FPL. Despite assurances made by Howle when he voted to accept FPL’s letter of intent, no serious effort has been made to negotiate the best price possible for the City. In fact, no one has been authorized to negotiate on behalf of the City. By their own admission, the transactional attorneys are contract lawyers, not negotiators.

Jim O’Connor

Rather than encouraging and advising the Council majority to negotiate the best deal possible, City Manager Jim O’Conner seems focused on counting to three. Three Council members can fire O’Connor, and three Council members can protect his job. Right now, O’Connor’s job security seems tied to appeasing Howle, Moss and Sykes, all of whom are beholding to FPL and to wealthy Indian River Shores residents who funded their campaigns.

In a separate email to the City Clerk’s Office, Finance Commission member Peter Gorry raised his own concerns about the apparent lack of due diligence being done by the City. “…due diligence is not accepting a two page memo from a non-binding LOI (letter of intent), but a deliberate, comprehensive, holistic and specific analysis of data, financials, proceeds, cash flow, value — replacement vs. book value — risk, and the impact upon tax payers, ratepayers and the City.”

Gorry concluded, “I support our Commission Chairman and Council members who support a transparent, full and rigorous/extreme vetting of any and all transactions in which the City engages.”

Council members Richard Winger and Tony Young have also raised concerns over the lack of due diligence and negotiations being done by and on behalf of the City. At last weeks’ Council meeting Young said, “Fundamental questions should be examined. Who is looking at the financial implications of this deal? It is not being done.”

Winger, too, is concerned that Howle, Moss and Sykes, all beneficiaries of FPL political contributions, are caving to the utility giant. “If you try to conclude this sale without negotiating the best price possible for the City, you will not have my vote,” Winger told them.

As faithful servants of FPL, Howle, Moss and Sykes deflect criticism by arguing that anyone who questions them and their process is not working for the best interests of the City, but is simply opposed to the sale. Sykes, who received 90 percent of his campaign contributions from outside the City, continues to insist that accepting FPL’s opening negotiating position is the best deal possible for the City.

Sykes claims executive experience. In truth, the company he ran was a one employee, home based business. Similarly, Howle and Moss lack the financial experience to conclude a nearly $200 million transaction without advice and input from members of the City’s advisory commissions. Lacking that vital input, they could at least use some courageous guidance from O’Connor.

3 comments

  1. Accepting the sale of our total power system is a lot different than accepting we are being shafted. Either the three Council members take part in this deal or step aside and let Mr. Winger and Mr. Young….plus 3 new Council members with experience also, do us proud. We will NOT take whatever crumbs may be offered to us. We WILL receive enough to continue operating as the City of Vero Beach and settling up with OUC and anyone else. Either handle this the right way or let FPL take their letter of intent and go away.

  2. Here the challenge, at least one of them. The fair market value of Vero Electric is all FPL can reasonably be expected to pay. As Mr. Stump has pointed out, that price may or may not be more than $185 milllion. His point, and the point being made by others, is that no one at the City seems to know that number. Unfortunately, Howle, Moss and Sykes, beholden as they are to FPL, seem not to care.

  3. The Utilities and Finance Commissions MUST be allowed by Moss, Howle and Sykes to examine the latest offer by FPL. Unless this is done , we all should be suspicious of the motives of Moss, Howle and Sykes.

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