Gorry again raises concerns about lack of due diligence on partial sale

Peter Gorry

Editor’s note: The FPL-sponsored City Council majority of Harry Howle, Laura Moss and Lange Sykes has forbidden the Finance and Utilites Commissions from holding meetings to review the terms of the proposed sale of Vero Electric to Florida Power and Light. These citizen advisory boards are also forbidden from meeting to review the terms of what could become a partial sale of Vero Electric’s Indian River Shores customers. Today, Finance Commission member Peter Gorry sent the following message to the Council raising his concerns about the process, and about what he believes will likely be negative impacts of any partial sale.

From: Peter Gorry
Sent: Tuesday, October 17, 2017 2:17 PM
To: Bursick, Tammy
Subject: FPL/VBE Sale

Mayor Moss and City Council Members,

The Finance Commission was clear, our vote at the joint FC/UC meeting was for the full sale only. Not for any partial sale.

The only information regarding a partial sale is in the LOI, which is extremely limited and proposes a price of $30M which is $12M less than the City staff and consultants recommend.

There has been no due diligence; information crucial to the analysis (actual revenues, anticipated expenses, cash flow, profitability, increase of rates for remaining customers, obligations to OUC/FMPA, transition costs, specifics of the over $21M VBE capital program, proposed use of proceeds which can only be for VBE capital and or debt, potential risks, impediment to a remaining sale,et alia) was only provided in the second quarter of 2017 – and is still incomplete. No contract has been available for review.

For example, in a partial sale the $128M FMPA/OUC obligation remains. $30M from a partial sale represents over 16% of the full sale; equivalent to over a $20M share of the FMPA/OUC payments.

I firmly believe until the contract details are evaluated and understood, that automatically defaulting to a partial sale without any due diligence is not responsible and emphatically endorse Chairman Brovont’s call for a FC meeting

Peter Gorry
Finance Commission member.

cc: Finance Commission
Utilities Commission

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