The contract for the sale of the Electric Utility to FP&L was successfully voted upon Tuesday by Vero Beach City Council. If it results in a full sale, that is a very Good thing!
We had very little time to review the contract, leaving no opportunity for commissions and the public to study, vet and comment. It was delayed coming to City Hall past the Wednesday noon deadline. Most arrived Friday, but parts of it were still arriving on the day before the Council vote. A similar rush to sign contracts in 2008 and 2012, which turned out to be flawed contracts, cost us millions of dollars. I can only pray the same fate will not occur this time.
But there is a huge problem associated with this signed contract. If the full sale cannot occur because of existing obligations or legal challenges, then a partial sale of the Indian River Shores customers is AUTOMATIC. It is in the signed contract. The two sales are wrongly interwoven in one contract.
Then, if the partial sale is not done, there is a $1 million penalty to the City or a risk of further law suits. Those costs would be passed along to the people. This is a very Bad thing.
So we have the Good and the Bad indelibly intertwined. There was no reason for this, except for political payback to those outside our City for their campaign contributions.
Because the Council majority refused to consider the full and partial sales separately, I could not vote for the contract, even though I believe a full sale should be accomplished.
If this all ends in a partial sale because of the obligations we cannot exit, the remaining ratepayers will have a significant burden assuming these costs:
- The sale is $15,000,000 shy of what experts stated is the price need to keep the remaining rate payers whole.
- Contractual obligations to other entities will be spread over a smaller base, resulting in higher costs on the smaller utility.
- The most profitable portion of the Utility will be gone.
- The payment from FP&L, must, by law, remain in the Utility and cannot be applied elsewhere.
The result will be higher costs for all the remaining ratepayers, so the Shores can have lower rates. And City property taxes will no doubt rise.
Keep in mind, the City is allowed 6% in profits, and this transferred to the General Fund to keep our special quality of life in our City. On the other hand, FP&L is allowed 11% in profit and that money does not stay locally.
It seems there was no conscience as long as the contract was signed. Any contract!
We were told we had to protect FP&L. That if the full sale fails, they deserve this! They don’t deserve anything beyond the completion of the full sale. You don’t owe them a dollar, if the full sale fails! But that is not how the vote went.
It has been my responsibility to protect the interests of the people of our city, and all the ratepayers of the Electric Utility. An AUTOMATIC sale of just a portion of the Utility hurts you, so I had to vote against it.
This is getting Ugly.
There are other important matters coming before Council, like the Arts Village. This election is about more than the sale of the electric. It is about protecting our citizens and our City..
Your vote for our future is more important than ever……..
Editor’s note: Richard Winger is a member of the Vero Beach City Council.