Everyday socialism, American-style, is happening now all across the country 2

Editor’s note: The City of Vero Beach Utilites and Finance Commissions will meet Aug. 30 to review the terms of the proposed sale of Vero Electric to Florida Power and Light. City Hall watchers expect the Council to approve the terms of the proposed sale when it next meets in September. As Vero Beach prepares to hand over its municipally owned utility for net proceeds of little more than existing cash reserves, the following article on public utilities is worth considering.  This article exploring the benefits of public ownership of utilities was first published in 2013 by truth-out.org.

According to the most recent bills comparisons published by the Florida Municipal Electric Association, FPL’s rate for 1000 kilowatt hours per month is $106.05, allowing for a six percent franchise fee. Vero Electric’s rate is $116.08. Based on current rates, then, Vero Beach residents could expect to save approximately 9 percent on their electric bill, if the deal were to close now. However, FPL will be making a number of rate hikes over the coming years, all of them already approved by the Florida Public Service Commission. Whatever saving Vero Beach residents will see on their electric bills will be somewhat offset by cuts in services and/or tax increases, as the City deals with the loss of $7 million no transferred annually from the Electric Fund to the General Fund.

For a start: It’s often forgotten—or simply not known—that there are more than two thousand publicly owned electric utilities now operating, day by day, week by week, throughout the United States (many in the conservative South). Indeed, 25 percent of US electricity is supplied by locally owned public utilities and co-ops.

Moreover, most of these now conventional “socialist” operations have a demonstrated capacity to provide electricity at lower cost to the consumer, not to mention cheaper and more accessible broadband. (Nationally, on average, customers of private utilities pay 14 percent more than customers of public utilities.)

One obvious reason: Public utilities and co-ops simply don’t pay the same exorbitant executive salaries common in the private sector. They get pretty much the same work done for far less. General managers of the largest class of publicly owned power companies earned an average salary of roughly $260,000 in 2011. Average compensation for CEOs of large investor-owned utilities was $6 million—almost twenty-five times as much.

Also, of course, public utilities and co-op producers don’t have to pay private shareholders any dividends. And they return a portion of their revenues to the city or county to help supplement local budgets, easing the pressure on taxpayers. A recent study found an average transfer of 5.2 percent of revenues to municipalities—compared with average tax payments by private-investor-owned utilities of 3.9 percent.

Continue reading…

Old sees power sale closing in 2018 2

Former Vero Beach City Councilman Randy Old is running this fall to regain a set on the Council. Old this week issued the following “update” on the proposed sale of Vero Electric to Florida Power and Light. 

RANDY OLD

Randy Old

Short version: aiming to be signed by September 5th 2017, final FMPA approval by January 2018.

Longer Version:  at Tuesday’s City Council meeting both Florida Power and Light’s (FPL) and Florida Municipal Power Agency’s (FMPA) representatives together with Vero Beach’s lawyer brought the Council up to date on the progress of the sale. The numbers have not changed and they are approximately as follows:  FPL is paying $185 million, Vero is paying off its debt and exiting its Orlando Utility Commission (OUC) contract for $47 million, and exiting FMPA for $108 million leaving Vero with net proceeds of some $30 million. More…

Behind closed doors 1

NEWS ANALYSIS

Though Moss has no legal authority to negotiate on behalf of the City, or to act with O’Connor as an ad hoc committee, that clearly seems to be what she is doing. Her actions, and those of O’Connor, could well be in violation of Florida’s open government laws.

MARK SCHUMANN

Jim O’Connor

Laura Moss

Today, representatives of the Florida Municipal Power Agency, the Orlando Utilites Commission, Florida Power and Light and the City of Vero Beach are to meet to discuss the proposed sale of Vero Electric to FPL.  Representing the City will be City Manager Jim O’Connor and Councilwoman/Mayor Laura Moss.

In explaining why the discussions will not be open to the public, and why other members of the City Council are not allowed to attend, O’Connor described the meeting as “administrative.”  The meeting may well be “administrative,” but it is also part of the entire decision-making process, or what Florida’s courts have described as “the inquiry and discussion stages.” These discussions, the courts have ruled, are also subject to the Sunshine Law.

Though Moss has no legal authority to negotiate on behalf of the City, or to act with O’Connor as an ad hoc committee, that clearly seems to be what she is doing. Her actions, and those of O’Connor, could well be in violation of Florida’s open government laws.

Addressing a similar situation, then Florida Attorney General Robert Butterworth wrote that for the Sunshine Law provisions requiring open meetings to apply, “2 or more members of a body or other entity or group to which the Sunshine Law applies must be present, or there must be delegation of decision-making by such a body to either a single member thereof or to an advisory group or committee used by the covering entity.” (Below is the full text of the Attorney General’s opinion.)

The City Council has never voted to delegate to Moss the authority to represent the City in its negotiations on the proposed sale of Vero Electric, but the Council’s acquiescence in Moss’ assertion of authority to do so could well be construed as consent.

If Moss, and now O’Connor, are skirting, if not violating, Florida’s open government laws and the City’s policies for handling public records, it will not be the first time. Last summer, as Chair of the Utilities Commission, Moss wrote the head of the Florida Public Service Commission, but failed to forward the correspondence to the City Clerk’s Office. More recently, Moss wrongly claimed as “privileged” documents that should have been public record, and Moss and O’Connor seemed to have collaborated in delaying the release of those documents until FPL was ready to make a public announcement relating to the documents.

Moss has publicly likened her role “like being the queen of Vero Beach.” If Moss is assuming she is above the law because “the monarch can do no wrong,” then she must think she is living in some country other than the United States of America.

At stake here is the interest of the City and the people of Vero Beach. With only Moss and O’Connor in the room, who is looking out for the people of Vero Beach?

Given that Moss was aided in her election by a $50,000 contribution from FPL to a political action committee supporting her, it is difficult to imagine how she can be expected to do anything other than capitulate to FPL’s every demand.

For his part, ever since assuming his position as City Manager, O’Connor has focused on protecting his job by shifting his priorities to conform to changes in the Council majority. Given that O’Connor well knows the current proposal is not a fair deal for Vero Beach, his going along with Moss can be seen as nothing other than malicious obedience.

More…

Meter at City’s outside utility counsel running – now $136,757 2

MARK SCHUMANN

The City has not yet received an invoice from its outside utility counsel for work done in June. But the bill is now in for May, and it totals $73,051. Through the end of May, the Tampa based law firm of Carlton Fields has billed the City a total of $136,757 for crafting a letter of intent with Florida Power and Light, and working on contractual obligations the City has with Florida Municipal Power Agency and the Orlando Utilities Commission. These legal fees are ultimately paid by the City’s electric customers.

At some point, if the City is to be released of its long term obligations to the FMPA, all of the agency’s member cities will have to agree to the terms of just over $100 million.  One veto, presumably, will kill the deal.

On the OUC front, FPL had allowed for $20 million in its total offer of $185 million to settle the City’s wholesale power contracts. The OUC, however, has put Vero Beach on notice that the actual damages it will suffer could far exceed $20 million, perhaps as much as $50 million.  Resolving the difference could require expensive mediation, and perhaps even more costly litigation.

In negotiating the now defunct and shelved 2013 purchase sand sale agreement between FPL and Vero Beach, the law firm of Edwards Wildman charged more than $1 million. Edwards and Wildman was replaced by Tallahassee utility counsel Schef Wright. At half the hourly rate of Edwards Wildman, Wright defended the City against a lawsuit pursued by the Town of Indian River Shores. Wright also negotiated a revised agreement with the OUC that shortened the length of the contract and cut City’s wholesale power bills.

In dismissing Wright and hiring attorneys with Carlton Fields, Council members Harry Howle, Laura Moss and Lange Sykes, again signed the City up with a $500-an-hour attorneys.

 

State Attorney asked to review Laura Moss’s handling of public records 7

Laura Moss

For a full ten days in advance of the release of Florida Power and Light’s letter of intent to acquire Vero Electric, Vero Beach Mayor Laura Moss kept in her private possession a draft of the document. On May 1, Moss received the draft in an email from the City’s outside utility counsel with the law firm of Carlton Fields.

Rather than sending the correspondence to Moss’s official City of Vero Beach email address, the outside counsel instead directed  it to the Mayor’s private email address. Despite the fact that the documents in Moss’s possession should have been immediately forwarded to the City Clerk’s Office and made a part of the public records, Moss withheld the information until the afternoon of May 10. Without question the documents in Moss’s possession were the legitimate subject of public records requests made by Brian Heady, InsideVero and the Press Journal on May 2, May 6 and May 8,

Today, in an email to Assistant State Attorney Chris Taylor, InsideVero editor and publisher Mark Schumann set forth the reasons why he believes Moss should be investigated for a possible violation of Florida’s open records laws. The following is the full text of Schumann’s letter to Taylor. More…

Brovont raises questions about power sale ‘negotiations’ 1

MARK SCHUMANN

Glen Brovont

“Shut down,” “censored,” and “muzzled” are a few words being used to describe the state of Vero Beach’s Utilities and Finance Commissions. As Press Journal columnist Larry Reisman wrote this week, “In 3-2 votes two months apart, the council majority of Laura Moss, Lange Sykes and Harry Howle muzzled their advisory commissions from meeting to analyze the latest details of a possible sale.”

One community leader who is deeply concerned over the decision of Moss, Sykes and Howle to press ahead with the proposed power sale without conducting due diligence is Finance Commission Chairman Glen Brovont.

Brovont wrote and distributed an email yesterday raising as many as a dozen concerns about where the deal stands and where it may be headed.  The scathing email is written in code, so as not to violate the Council majority’s dictate forbidding discussion of the Orlando Utilities Commission, the Florida Municipal Power Agency or Florida Power & Light. Code or no code, it does not take a counter intelligence expert to read between the lines of Brovont’s message. Clearly he does not believe any meaningful negotiations are taking place between the City and FPL. Rather, it appears Moss, Howle and Sykes, all of whom were heavily supported in their campaigns by FPL, are simply accepting the utility giant’s opening offer.)

In addition to expressing concern about the the lack of due diligence and the apparent absence of any meaningful negotiations, Brovont questioned whether Council members are fulfilling their fiduciary responsibility to the City. He also questioned if the negotiations and surrounding communications are taking place in compliance with Florida’s open government laws.  (In late April, Laura Moss received email communication from the City’s special utility council on her private email account. Despite public records requests for the documents having been made on May 2, May 6 and May 8, Moss claimed the information was “proprietary,” and refused to turn the records over to the City Clerk’s Office until May 10 at 3:00 p.m. May 10 just happened to be the date when FPL was prepared to make public the terms of its proposed letter of intent to acquire Vero Electric. Moss’s deliberate delay in releasing what should have been easily accessible public records may well be a violation of the Florida Sunshine Law.)

The full text of Brovont’s email appears below. In deciphering his memo, it is helpful to note that the “Stalking Lion” stands for Florida Power and Light, the “Elephant” for the Orlando Utilities Commission and the “Rhino” for the the Florida Municipal Power Agency. More…

Worth reading: Press Journal columnist calls for careful vetting of power deal 1

“…And while power users likely will see significant cost savings, questions remain over how the city will cope financially without the $5 million to $6 million the electric operation transfers into the city’s general fund annually…This is the people’s business. It is the people’s electric utility and government. Any proposed deal must be fully vetted, with the public given plenty of opportunity to learn more about the proposal and to weigh in.” – Larry Reisman Continue reading…

Not everyone loves FPL service 2

Comments to a recent post on the Indian River County Scanner Radio page suggest not everyone is pleased with the service the receive from Florida Power & Light. The post alerted readers to a down power line and a power outage west of Interstate 95 along State Road 60.
Brady Hagerman – FPL had a week to tighten the lines and they didn’t. Definitely their fault.”
Facebook Comments:
Linda Zeller – FPL does NO maintenance in Western Vero.
Linda Zeller –  I live in SW Vero and we lose power almost every time it rains. I’ve even filed a complaint with the Florida Utilities Commission. You get a lot of lip service from FPL after that. I told them they don’t have to call me, just start replacing some of these 90 degree poles and hanging lines.
Steve Demers – I had a fire on the line and they refused to expedite the call, so I called 911. The fire department got it expedited!
Sarah Mitsakos-Bass – My neighbor has been complaining since before Matthew that theres a dead mango tree tugging on the lines in the yard behind hers. House is vacant so nobody cares.
Faith Carmen Burnell-Thomas – FPL does no maintenance anywhere! The wires in my back yard caught the trees on fire and it took 2 trips from the fire dept 2 days in a row and a phone call from the fire cheif to get fpl to trim them. I called fpl 5 times prior and made complaints and I have the slip they give you that says the trees are not a hazard.
Jen Mueller – FPL doesn’t trim trees
Fa ith Carmen Burnell-Thomas – They do when they have too
Jen Mueller – I’m saying they don’t come out and trim them. Yes, if there is an obstruction at a job they’re completing but that’s about it.
Jen Mueller – Asplundh trims for them
Faith Carmen Burnell-Thomas – Fpl themselves came to my house and trimmed the trees after they caught fire 2 times at 10:00 pm
Douglas Weaver – Those sums a *&%$#@ at FPL… wish I was on City of Vero Beach Electric Utiliities
Judy Wagner – FPL is a joke, many areas in my area the poles are still leaning 4 feet from the hurricanes in 2004.

Trish Velde – They did not hit the pole. The wires were dangling lower than they are supposed to and when the truck came through driving normally the wires got caught on the truck and the pole fell. Not the drivers fault. FPL had been notified about the wires and had not fixed the problem.
Brady Hagerman – FPL had a week to tighten the lines and they didn’t. Definitely their fault.

Decency. Diligence. Democracy. 

Where are you?  6

COMMENTARY

RICHARD WINGER

Richard Winger

There seems to be a reluctance on the part of a Council majority to examine the details of FP&L’s offer for our Electric utility.  This is difficult to accept.

The last contract was blindly signed by Council members who were not diligent about the terms, specifically to standing contractual obligations. After millions of our ratepayer dollars were later spent on legal actions, the courts confirmed those legally binding contracts.  The result was having a contract with FP&L which could not be executed.  We are supposed to learn by mistakes and not repeat them.

I have been working for 7 years to complete this sale and I am not stopping now. But it has become problematic.

When I bring up challenges to the successful completion of the sale my comments are routinely interrupted by Mayor Laura Moss who attempts to silence me. Vice Mayor Harry Howle then raises his voice, leans forward, turns towards me and proceeds with accusations that have no basis in fact.  Silence. The agenda moves on. More…

Finance Commissioners raise questions about power sale 3

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.” More…

Howle, Moss and Sykes are selling out the people of Vero Beach 5

Lange Sykes' acceptance of so much outside money in his latest campaign, (90%), suggest that, if elected, he may have an extremely difficult time balancing loyalty to his patrons against his fiduciary responsibility to the people of Vero Beach.
COMMENTARY

“The troika seems determined to make the best deal possible for FPL and for Shores interests.”

MARK SCHUMANN

Imagine the suspicions that would be raised if a U.S. presidential candidate received 70 percent of their total campaign contributions from Russian oligarchs.

The Russians don’t care about public policy in Vero Beach, Florida, but Indian River Shores oligarchs sure do. They contributed heavily to the campaigns of Harry Howle, Laura Moss and Lange Sykes, and they joined Florida Power and Light in raising more than $100,000 to fund a political action committee to support Moss and Sykes in last fall’s municipal election. (Moss received 70 percent of her campaign funds from Shores residents. Sykes took in 90 percent of his campaign funds from the Shores.) More…

Indian River Shores Councilman derails Vero Beach’s Utilities Commission 2

City Code:

The utilities commission shall meet at least once every quarter.”

COMMENTARY

“…Howle, Moss and Sykes continue to insist a partial sale at $30 million would be a good deal for the City. Just this week though, Finance Director Cindy Lawson released a report projecting that a partial sale will lead to a 1.9 percent rate increase for the remaining customers and a tax hike on City residents of 9 percent to 12 percent.”

“With Howle, Moss and Sykes in the majority at City Hall, and with Brian Barefoot and Bob Solari behind the scenes pulling their strings, Vero Beach is quickly becoming like Venezuela, a failed democracy.”

MARK SCHUMANN

Robert Auwaerter – The fox in the henhouse

Laura Moss

In what appears to be a clear violation of City of Vero Beach Ordinances, the City’s Utilities Commission has gone dormant. Indian River Shores Town Councilman Robert Auwaerter, who just happens to also be Vice Chair of the Vero Beach Utilities Commission, has yet to call a meeting of the Commission in 2017.  Auwaerter assumed responsibility of the Commission when the previous Chair, Laura Moss, was elected to the Vero Beach City Council.

Vero Beach City Ordinances require the Commission to meet to elect a new Chair.  According to City Clerk Tammy Bursick, her office has inquired with Auwaerter monthly about convening the Utilities Commission. Each month he has declined to do so.

Auwaerter is a ally of Moss, who won election with overwhelming financial support from Indian River Shores residents and from a political action committee that raised more than $100,000 exclusively from Shores residents and Florida Power and Light. (Shores residents graced Moss with 70 percent of her campaign contributions. Lange Sykes took in 90 percent of his funds from the Shores.) One has to wonder if, in failing to convene the Utilities Commission, Auwaerter is taking direction from Moss, who appears to be receiving her marching orders from Shores Mayor Brian Barefoot and from FPL. More…

OUC wants far more than $20 million to settle electric contracts Reply

Winger, Young decry lack of negotiations

NEWS ANALYSIS

“Who is looking at the financial implications of this deal? It is not being done.”  – Councilman Tony Young

“Given that, as candidates, Howle, Moss and Sykes were all heavily supported by FPL, perhaps Young should not be surprised to see them accept whatever FPL offers.”

MARK SCHUMANN

Tony Young

Richard Winger

In an email sent yesterday to Vero Beach City Manager Jim O’Connor, Orlando Utilities Commission Vice President Jan Aspuru put the City on notice that it will cost far more than $20 million to settle its obligations to the OUC. Aspuru noted that the letter of intent between Florida Power and Light and the City for the sale of Vero Electric provides no more than $20 million to release Vero Beach from its contractual obligations to the OUC. Vero Beach buys the bulk of its wholesale power from the OUC.

“I wanted you to know that the OUC’s damages will far exceed the $20 million if Vero Beach defaults on its contractual commitments to the OUC,” Aspuru wrote.

FPL is now offering some some $20 million less for Vero Electric than the company was willing to pay in 2014. Previous forecasts based on FPL’s offer suggested the City would net $30 million in cash from FPL. Aspuru’s caution raises the prospect that the City could wind up getting nothing from the deal.

Despite these developments, Council members Harry Howle, Laura Moss and Lange Sykes continue to insist FPL’s offer is more than fair. This week, over the objections of Councilmen Richard Winger and Tony Young, Howle, Moss and Sykes voted to impose a gag order on the City’s Commissions. Those boards are now forbidden from discussing or analyzing the impacts of the proposed sale. More…

Our obligation to endow the City of Vero Beach 1

COMMENTARY

Editor’s Note: Richard Winger is a member of the Vero Beach City Council.

RICHARD WINGER

Richard Winger

The Good news in my message today is that FP&L has submitted a document stating their intent to finalize a Purchase and Sale Agreement at Council’s only meeting in July on the 18th. Their document includes details of their  “Due Diligence” for the Acquisition of our Electric Utility.  The draft had been submitted and now they will finalize it.

This “Agreement” will be something determined by each party: FP&L’s part is the “Purchase” and the City’s part is the “Sale”. When does the City start to work on our “due diligence”?  Surely it cannot be an Agreement when only one party to it has done “Due Diligence”.

This is where the Bad enters my message. Not only have we not done our due diligence, but we now learn the Orlando Utilities Commission (OUC) has just made it clear they find FP&L’s offer in the Letter of Intent for the Vero Beach exit unacceptable. This is the same situation we had in the prior contract which expired last December.  At that time FP&L wanted to pass along $26,000,000 to the ratepayers, to be attached to their monthly bills, to accommodate OUC’s exit cost. If we are face with that again, power bills would likely increase over current Vero Beach rates, given the City has gone down 15% and FPL has gone up 10%.  The differential has shrunk greatly.
 More…

The very good, the bad and the ugly 8

FPL Letter of Intent

“FP&L’s $30 million offer for a Partial Sale is low, and should it be accepted, over time, the city will have to raise rates for every remaining ratepayer to absorb the loss of the Shores customers.” 

RICHARD WINGER/VERO BEACH CITY COUNCILMAN

Richard Winger

It is Very Good that Florida Power and Light has presented a new Letter of Intent to purchase Vero Beach’s entire Electric Utility. They outlined costs and terms, which signal the start of negotiations prior to a contract being signed.

Negotiations, simply put, occur when each participant has something to gain and something to lose. A successful negotiation concludes when each party benefits to the maximum extent possible.

The financial offer for the system is considerably lower than the last contract signed 3 years ago. And, it does not take into consideration the millions spent since that time to upgrade the system, close the plant, etc. My responsibility to the people of Vero Beach and the ratepayers of the Utility requires my attention to such detail. It is a starting point in negotiations.

Moving towards the full sale, through myriad details,  is something I have worked on for years and I sincerely want it to be completed this time.

FP&L last submitted a Letter of Intent on August 2012.  It led to a contract for sale in March 2014. That contract could not be executed because of contractual obligations, upheld by law, with other agencies to produce, transmit and distribute electricity. That contract expired December 31, 2016.

Those obligations exist because Vero Beach is a member city in the Florida Municipal Power Authority.  There are 19 other member cities which must, unanimously, approve an exit. This obligation blocked the sale previously, but there is a new level of optimism that approval can finally be accomplished. More…

Letter: Selling Vero Electric is Un-American 2

Editor’s note: The following letter received by InsideVero yesterday was also sent to City Council of Vero Beach, Town Council of Indian River Shores and Board of County Commissioners, Indian River County.

“I believe in municipal ownership of all public service monopolies… because if you do not own them, they will in time own you. They will rule your politics, corrupt your institutions and finally destroy your liberties!” – Thomas L. Johnson, Mayor of Cleveland, Ohio, 1908

 

Selling Vero Electric to FPL is Un-American!

Please acknowledge about Florida Power and Light’s (FPL) upcoming multiple rate increases, surcharges and more increase(s) and surcharge(s) to come later.

Please acknowledge about FPL’s SurgeShield program is ripping off their customers. Vero Electric already have surge protections in all places and does not charge.

Please acknowledge about local media blackout (Indian River Press Journal/TCPalm and 32963/VeroNews) on FPL’s multiple rate increases and surcharges. InsideVero and out of town newspapers reported the increases.

Please acknowledge about Bob Brunjes, Indian River Press Journal/TCPalm publisher is married to Amy Brunjes, FPL executive.

Please acknowledge the current rates between Vero Electric and FPL is now less than 8% – greatly reduced from 34% in 2009. More…

Press Journal columnist misstates electric rate comparison Reply

The Indian River County Commission assesses a 6% franchise fee on the electric bills of country residents who are customers of Vero Electric, and of FPL. Similarly, If an when the become customers of Vero Electric residents and businesses within the city will also pay a 6% franchise fee, yielding an effective FPL rate of $108.69, compared to Vero Beach’s current rate of $116.08. The difference between the two rates is 6.4%, not 20%, as many continue to claim.

COMMENTARY

“Reisman and his colleagues at Treasure Coast Newspapers persist in presenting the rate differential between Vero Electric and FPL in a way that shows how much more FPL customers would pay, if they switched to Vero Electric. This is a misleading and meaningless comparison. The relevant percentage is the savings Vero Electric customers could expect by switching to FPL. At 1000 kilowatt hours, that number is 8.7% for county customers and 6.3% for customers within the city. At 1200 kilowatt hours, based on today’s rates, the savings would be 14.3% for county customers and 9.1% for customers within the city.” 

MARK SCHUMANN

For years, in comparing rates between Vero Electric and Florida Power and Light, the FPL-friendly Press Journal has followed FPL’s lead in quoting 1000 kilowatt hour rates.  Probably because this measure now yields the least favorable comparison from FPL’s perspective, the Press Journal is quoting rates at 1,200 kilowatt hours.

On the mainland, inside and outside the city limits, some 90 percent of Vero Electric’s residential customers use an average of less than 1000 kilowatt hours per month. Based on the most recent information available from FPL and the City, at 1000 kilowatt hours, the rate differential between the two utilities is 8.7 percent, $116.08 for Vero Electric and $102.64 for FPL. Reisman seems not to want to use these numbers, probably because he has for the last 7 years been telling his readers they could save 25 percent or more, if the City would only sell its electric system to FPL. In fact, the FPL-friendly Press Journal has played key role in leading the public to embrace an exaggerated sense of the benefits of the proposed power sale.

Not only has Reisman taken to using a different rate level for comparison, he misstates the delta. As of March, FPL’s rate for 1200 kilowatts of residential power was $122.40. Vero Beach’s rate was $142.87.  The difference between those two rates is 14.3 percent, not 17 percent, as Reisman claimed when he wrote, “That’s about 17 percent more than FPL rates.” The simple, undeniable, indisputable fact is that at 1200 kilowatt hours customers of FPL are paying 14.3 percent less than customers of Vero Electric, not 17%. More…

In the face of shifting facts, will opinions on power sale remain unchanged? 6

Vero Beach FPL* Differential
March, 2017 116.08 105.98 8.7%
October, 2016 116.08 94.63 18.5%
November, 2013 130.93 98.29 24.9%
June, 2009 158.82 104.37 34.3%
COMMENTARY

“If the residents of Vero Beach who continue to support the power sale believe the deal will lead to significantly lower electric rates, they are going to be disappointed. If they think the move will not result in higher taxes, cuts in services, and major setbacks for the City, they are sorely misguided.”

“Sponsored and supported by FPL, aided by a power-hungry County Commission, and advised by Indian River Shores Mayor Brian Barefoot, what Howle, Moss and Sykes most lack is loyalty to the City and to the people of Vero Beach. Bathed in blissful ignorance, and supported by outside interests, they are prepared to drive the City to the brink of financial disaster.”

MARK SCHUMANN

In 2009, utility activists Glenn Heran and Steven Faherty began making presentations throughout the community to build support for the sale of Vero Electric to Florida Power and Light. At the time, the rate differential between the two utilities was 34.3%. Not only did Heran and Faherty promise impressive savings on electric bills, they assured everyone the sale would net the City more than $180 million. The money, they reasoned, could be invested, with the earnings used to make up for the $7 million that is annually transferred from the electric fund to the General Fund. That money helps pay for municipal services, such as police protection, recreation programs, life guards and parks maintenance.

It has been eight years since the two utility activists, encouraged and aided by FPL, began persuading the public of the supposed benefits of selling Vero Beach’s electric utility. Over the past eight years much has changed. FPL’s rates have risen, but more importantly Vero Electric’s rates have continued to decline. As a result, customers of Vero Electric stand to save far, far less than originally promised. Based on information available through the Florida Municipal Electric Association, for Vero Beach residents, the effective rate differential is now 8.7%. According to rate information quoted on FPL’s website, the differential is just 6.3%. (According the rates currently being quoted by FPL on its website, the after residential customers using 1000 kWh per month is paying $102.64, this is $2.66 more than the 1000 kWh rate listed on the FMEA website. The difference may have to do with peaking charges, but suffice to say FPL’s rate structure is complicated.) More…

Candidate Randy Old releases statement on proposed power sale 3

Editor’s note: Former Vero Beach City Councilman Randy Old will be running again for a seat on the Council this coming November. Old today released a statement supporting the sale of Vero Electric on the terms recently proposed by FPL.  

FPL’s offer to buy the full utility system is coupled it with agreement to a partial sale of the City’s Indian River Shores customers for $30 million. If the board of the Florida Municipal Power Agency does not approve the deal, or if for any other reason it cannot be completed, Vero Beach will be obligated to sell its Shores customers and infrastructure to FPL for $30 million.

While running for re-election last fall, Old said agreeing to sell the Shores portion of Vero Electric for $30 million would have been a violation of his fiduciary responsibility to the City and to the people of Vero Beach. The statement Old released today does not make clear whether he now supports a partial sale at $30 million, though he did indicates some points in FPL’s proposal may “need to be altered or negotiated.”

Florida Power and Light Makes Offer to City Electric Business

Randy Old

FPL’s offer to the City to buy the entire electric business was announced yesterday. Simply put, FPL is offering to pay $185 million leaving the City with $37 million in cash after the City pays to exit its contracts with FMPA ($108) and OUC ($20), and pays off electric business debt ($20). This should be accepted by the City Council.

The agreements are long and detailed, and there may be some issues that need to be altered or negotiated, but most seem straight forward and reasonable. There are some key issues included. FMPA’s board must unanimously approve the transaction. One City voting against the sale could stop it. I believe that FMPA will approve the transaction and the full sale will be achieved. However, the other key point is, that if the full sale does not go through then, there is a commitment to sell the Indian River Shores portion of Vero Electric to Florida Power and Light.

FMPA reduced its price for Vero to exit its obligations from over $350 million to $108 million, or a 70% reduction. This reduction which happened in the fall, allowed the transaction to become viable. FPL’s past offer was similar to this in size but included our existing plant and other issues not appropriate in this offer. However, had past City Councils agreed to take FLP’s offer of $185 million, and had to pay $350 million to get out of FMPA, plus pay OUC $20 million to exit its contract, and repay its debt of $20 million, the City would have had a net loss on the transaction of $205 million ( +$185 – $350 -$20-$20 = – $205). An impossibility. With the reduced cost to exit FMPA, the transaction is not only possible but attractive.

FMPA changed its mind, was is the new CEO, was is the amount of legislative pressure in Tallahassee, or just a change of heart. But it doesn’t really matter; this is a reasonable transaction that should be accepted.

Next steps, be sure the city uses the proceeds of the sale wisely to minimize the adverse effect on Vero’s finances and its taxpayers. Also, it goes without saying, that it will be a huge relief to the community to have this issue not dominate and divide the city, as it has for the past several years.

Randy Old

Facebook comments on power sale reveal that some, perhaps many are misinformed, or uninformed 1

COMMENTARY

“If the general belief is that electric rates are going to come down 20% to 30%, and if the widespread assumption is that the sale will not results in tax increases, and/or cuts in municipal services, then pressing ahead with the sale amounts to malicious obedience.” 

MARK SCHUMANN

This past weekend, I took exception to a commenter’s assertion that, despite the unprecedented level of outside money that poured into last fall’s municipal election, the results were a fine example of democracy in action. In truth, the election of Harry Howle, Laura Moss and Lange Sykes to the Vero Beach City Council is a sad example of how money can buy power, especially when the press fails to do its job.

Last fall, more than $100,000, half of it given by Florida Power and Light and half contributed by Indian River Shores residents, funded a political action committee supporting Moss and Sykes. The committee used the money to carry out an extensive disinformation campaign of truly outlandish claims and promises. Further, Sykes received 90 percent of his financial support from Shores residents. Moss took in 70 percent of her campaign contributions from outside Vero Beach. Without question, outside money bought their seats on the Council.

The commenter wrote, “Their paths to office are in accordance with their constitutional rights, and now the City’s decisions rest in their hands.”

In a response titled “A failure of the fourth estate,” I wrote: More…

Meter running of City’s legal bills – $49,498.25 for first month 3

MARK SCHUMANN

Florida Power and Light officials yesterday submitted a letter of intent containing proposed terms for the sale of Vero Electric.  Today, attorneys with the law firm of Carlton Fields, all of whom charge $480 per hour, today submitted an invoice to the City totaling $48,498.25 for work done through the end of March in helping preparing and review FPL’s offer.

Next Tuesday, the Council is to consider, and will likely vote to accept, FPL’s proposed terms. At that point the expensive work of hammering out a formal contract will begin. The previous purchase and sale agreement between Vero Beach and FPL expired at the end of last year. The City’s outside counsel charged more than $1 million to write that now defunct contract.

Is Moss misleading public about ‘financial review’ of power sale? 3

Editor’s note: During last Tuesday’s Vero Beach City Council meeting, Mayor Laura Moss claimed City Staff has been conducting an ongoing financial review of the likely terms FPL will propose in a letter of intent to be presented to the Council at a special call meeting on May 16. When Vero Beach resident Brian Heady asked for the release of any documents related to Staff’s review and analysis of FPL’s pending offer, Moss claimed the information is proprietary and had Heady removed from the Council chambers. The information Heady sought is not proprietary, as Moss claimed. Saturday, InsideVero requested the information. Yesterday, apparently after the Press Journal weighed in, City Staff began releasing documents. Attorneys with the law firm of Carlton Fields, who are acting as agents of the City, appear to have informed City Manager Jim O’Connor that they will not release documents in their possession until FPL’s letter of intent is made public. 

Unless members of City Staff are withholding other documents in their possession, the information released yesterday makes clear Moss is not telling the truth in claiming Staff has conducted a financial review of the proposed deal. In fact, all Staff appears to have done to date is respond to requests from FPL officials for information the company needs to prepare an offer to acquire Vero Electric. What this means is that by the time FPL presents its letter of intent, company officials will have had months to consider the terms they are proposing. 

When the Council meets next Tuesday City officials will have had little, if any time at all to thoroughly review FPL’s terms. Despite this handicap, Council members Harry Howle, Moss and Lange Sykes have all indicated they will be prepared next Tuesday to accept the terms in FPL’s letter of intent. In short, there will be no negotiation on the terms of the sale. FPL’s offer will be a take-it-or-leave-it deal, and Howle, Moss and Sykes, all of whom were elected to the Council with significant support from FPL, show no inclination to negotiate the best deal possible for the people of Vero Beach.

BRIAN HEADY

Brian Heady

If there are no meaningful consequences for violating the Sunshine Laws then we have no real access to public records.

Our mayor said at the last meeting being mayor was like being queen.  In the current example the queen has wrongfully violated the constitutional rights of citizens by having me taken into custody and removed from meetings. Last Tuesday was not the first time.  

Her argument the information I requested is privileged is not legally defensible,  and the notion that no notes or written records of the FPL offer exist is impossible to take seriously.  A business entity such as our electric utility valued at over $200 million being offered for sale without a shred of written documentation is just not believable. If true this is completely and wholly irresponsible.  

More likely and more believable is there is a criminal conspiracy to hide the records from public view.  

Why?

 

Rate difference between Vero Electric and FPL now down to 6.4% Reply

 

The Indian River County Commission assesses a 6% franchise fee on the electric bills of county residents who are customers of Vero Electric and of FPL. Similarly, if and when they become customers of FPL, residents and businesses within the city will also pay a 6% franchise fee, yielding an effective FPL rate of $108.69, compared to Vero Beach’s current rate of $116.08. The difference between the two rates is 6.4%, not 20% as some continue to claim.

MARK SCHUMANN

According to Florida Power and Light, the company’s typical residential customers using 1,000 kilowatt hours per month is now paying $102.54.  Vero Electric’s rate for the same level of use is $116.08. One might conclude a move from Vero Electric to FPL will save the average Vero Beach residential power customer 11.7%.

However, anyone following the story of the proposed power sale knows Vero Beach’s rate includes a 6% transfer to the City’s general fund. Further, anyone seeking to report the story truthfully will account for the fact that the City will begin assessing a 6% franchise fee on FPL’s new Vero Beach customers. In short, accounting for an inevitable 6% franchise fee, Vero Beach residents would today be paying an average of $108.69 per 1000 kilowatt hours, if they were customers of FPL. That amounts to a rate differential of just 6.4%.

When the power sale was first sold to the public, the rate differential between Vero Electric and FPL was closer to 30%.  Further, the public was told the sale would net the City some $180 million dollars, and would not require cuts in services or increases in taxes.

Today, the rate differential between the two utilities is down to 6.4%, and it is obvious the sale of Vero Electric will lead to tax increases and cuts in services. More likely, the sale will leave the City unable to develop a balanced budget.

In spite of these undeniable facts, the Press Journal continues claim the rate differential between Vero Electric and FPL is 20%.  Further, the newspaper has yet offer any enterprise reporting on the likely impact of the sale on taxes and services. Assuming the newspaper’s staff is not intentionally misleading its readers, but is simply misinformed, I wrote the following letter today to reporter Colleen Wixon, local columnist Larry Reisman, editor Adam Neal and editorial page editor Eve Samples. More…

Is City delaying release of public records? O’Connor says ‘yes,’ and ‘no’ 1

NEWS ANALYSIS

“In part that is right,” and, “No,” cannot both be accurate answers to essentially the same question.  O’Connor’s equivocation regarding the City’s rationale for not releasing the requested public records until May 16 further suggests City Staff is being pressured by Moss to conduct the public’s business in the shadows.

MARK SCHUMANN

Jim O’Connor

Contradictory answers City Manager Jim O’Connor gave yesterday regarding recent public records requests suggest the City is delaying the release of documents in order not to complicate efforts to negotiate terms of the Vero Electric sale in secret. Mayor Laura Loss claims the information requested is “proprietary.” It is not.

Moss, (who in the most recent election received $50,000 in support from Florida Power and Light), along with members of City Staff and attorneys with the law firm of Carlton Fields have been holding private discussions with FPL representatives on the proposed sale of Vero Electric. According to Moss, members of City Staff, likely O’Connor and Finance Director Cindy Lawson, have been conducting “a thorough review” of the terms of FPL’s pending offer.

FPL is to submit a letter of intent to City Council on May 16. That letter, Moss says, will become a part of the public record this coming Wednesday when it is included in the agenda packet for the May 16 special call meeting.

If the documents are not released until May 16, that will be fully 8 days after the initial request was submitted by Vero Beach resident Brian Heady. More…

Kept in the dark, Winger seeks attorney’s time sheets Reply

NEWS ANALYSIS

“FPL’s determination to acquire Vero Electric is evidenced by the hundreds of thousands of dollars the company has spent pushing referendums and sponsoring council candidates friendly to its cause. The larger objective, of course, is FPL’s desire to expand its customer base by acquiring additional municipal utilities in Florida. Vero Beach is just the first move in a much broader, state-wide chess game. FPL President and CEO Eric Silagy admitted as much in public statements made at an investor conference in March, 2013.” See: FPL president tells investors Gov. Scott is urging other municipal utilities to sell to FPL (Since 2013, FPL’s rates have risen steadily and significantly. Accounting for a franchise fee, the rate differential between Vero Electric and FPL at 1000 kilowatt hours per month is now less than 10%.)

MARK SCHUMANN

Richard Winger

Laura Moss

The law firm of Carlton Fields, engaged by the City three months ago, has yet to submit invoices for work the firm has done and is doing to negotiate a sale of Vero Electric to Florida Power & Light.

Absent invoices and itemized time sheets with which to assess the work of Carlton Fields, Councilman Richard Winger today submitted a public records request seeking those documents.  Even though Carlton Fields may be holding back on submitting invoices, surely the firm is keeping detailed records of time spent and work done. Those records will be needed to eventually prepare invoices. In his records request Winger wrote, “Such sheets, (time and billing sheets), should include time billed, or to be billed, and who acted or was “Present” (in person or on the phone) and on what specific day. “Present” means all personnel, whether from the City, Carlton Fields, FMPA, FPL, etc.”

Given Mayor Laura Moss’s secretiveness about discussions she has had with representatives of FPL and with Carlton Fields, it seems likely Moss may have requested Carlton Fields to delay submitting invoices and billing records.  Her goal would be to keep from public view as long as possible the nature of the discussions and of the work being done to craft a deal acceptable to FPL, to the Florida Municipal Power Agency and to the Orlando Utilities Commission. More…

O’Connor: No documents, no notes 1

On proposed power sale” “no documents, no notes.”

Claims City Staff has been conducting “an ongoing financial review.”

Following receipt today of InsideVero’s latest public records request, City Manager Jim O’Connor replied, “My office has no documents related to the proposed sale, but I have been involved in discussions, but there were no documents passed between parties in the discussion where I participated.”

When asked how staff could be conducting an ongoing financial review of FPL’s proposed terms without putting any information in writing, O’Connor replied, “I know better than to take notes in fact I usually will not carry a pen.”

O’Conner’s explanations make it unmistakably clear he and just one member of the City Council, Laura Moss, are negotiating the sale of a public asset and are doing so behind closed doors. Further, his comments raise questions about the veracity of Moss’s claim that members of City Staff have been conducting “an ongoing financial review” of the deal.

Moss, along with fellow Council members Harry Howle and Lange Sykes, seem set to accept FPL’s terms on May 16, the day the offer is scheduled to be presented. Based on what she has claimed so far, Moss seem likely to argue that the deal has already been carefully reviewed by Staff.

See: Power sale being negotiated behind closed doors

Power sale being negotiated behind closed doors 3

COMMENTARY

“Florida’s open government laws are intended to insure that the public’s business is conducted in the public, not in secret.  Moss appears to be flaunting, if not violating those laws. (In her recent election to the Council, Moss benefited from a $50,000 contribution FPL made to a political action committee supporting her.)”

Editor’s note:  Following receipt today of InsideVero’s latest public records request, City Manager Jim O’Connor replied, “My office has no documents related to the proposed sale, but I have been involved ini discussions, but there were no documents passed between parties in the discussion where I participated.” When asked how staff could be conducting an ongoing financial review of FPL’s proposed terms without putting any information in writing, O’Connor replied, “I know better than to take notes in fact I usually will not carry a pen.” O’Conner’s explanations make unmistakably clear he and just one member of the City Council, Laura Moss, are negotiating the sale of a public asset and are doing so behind closed doors. Further, his comments raise questions about the veracity of Moss’s claim that members of City Staff have been conducting “an ongoing financial review” of the deal.

MARK SCHUMANN

When it comes to Mayor Laura Moss’s negotiations with FPL, no one knows what is said behind closed doors.

During last Tuesday’s Vero Beach City Council meeting, Mayor Laura Moss acknowledged that the City’s outside attorneys have in their possession “complete information” on a pending letter of intent from Florida Power & Light. That letter is to be presented to the Council at a special call meeting scheduled for the morning of May 16.

At least based on public statements they have made to date, Council members Harry Howle, Lange Sykes and Moss intend to accept FPL’s letter of intent at the May 16 meeting. Unlike Howle, Moss and Sykes, Councilmen Richard Winger and Tony Young have said they will be reluctant to accept even an outline of FPL’s offer until the terms can be reviewed by the Finance and Utilities Commissions.

According to Moss, member of City Staff have access to at least the outline of FPL’s pending offer. The information, Moss said, has been the subject of “an ongoing financial review by Staff.” Despite Moss’s public admission that the specifics of FPL’s pending offer are in the hands of the City’s outside counsel, as well as Staff, no one at the City has yet been willing or able to provide the information in response to public records requests. More…

Will FPL’S political investments in Howle, Moss and Sykes pay off? 2

And who is looking out for Vero Beach?
COMMENTRY

“Certainly a majority of Vero Beach voters have more than once expressed support for selling Vero Electric. What voters have never approved, however, is the kind of determination Howle, Moss and Sykes are showing to hand over the City’s largest asset on terms that are not carefully reviewed, and that might be terribly unfair to the City, its residents and taxpayers.”

MARK SCHUMAN”N

Laura Moss

At the Council meeting scheduled for Tuesday, May 9, representatives of Florida Power and Light are expected to present a letter of intent to acquire Vero Beach’s municipal electric utility. Except perhaps for Councilwoman Laura Moss, who has been in direct discussions with FPL representatives, no one knows exactly what terms FPL will offer.

When Richard Winger first ran for a seat on the Council in 2011, his campaign theme was “A Fair Deal” for Vero Beach. Winger’s concern at the time was that the Council not simply cave to FPL’s terms, but instead negotiate terms that would be fair to the City. As it turned out, the Council majority of Tracy Carroll, Craig Fletcher and Pilar Turner approved a fatally flawed, unworkable contract that expired last December.

Now the new council majority of Harry Howle, Moss and Lange Sykes, all of whom were elected with significant financial support from FPL, seem set to swallow hook, line and sinker the utility giant’s new offer.  So determined are Howle, Moss and Sykes of concluding the sale on FPL’s terms that they have, over the objections of Winger and Councilman Tony Young, muzzled the Finance Commission by instructing it not to discuss the proposed deal. More…

Florida Senate advances bill to let FPL charge customers for fracking costs Reply

Intended to overturn a 2016 Florida Supreme Court ruling, the legislation will allow FPL to place the financial risk for fracking and exploration on the backs of its costumers. In 2015, FPL lost $5.6 million on a fracking venture in Oklahoma.

Editor’s note: Tuesday, May 9 the Vero Beach City Council is to receive, and presumably accept a letter of intent from FPL to buy Vero Electric.

MARY ELLEN KLAS/MIAMI HERALD

Florida Power & Light’s quest to have customers pay for natural gas fracking projects in other states overcame a key hurdle Tuesday as the Senate Rules Committee passed the controversial measure and overlooked opposition from residential and commercial customers.

The proposal, SB 1238 by Sen. Aaron Bean, R-Fernandina Beach, now goes to the Senate floor. A similar measure in the House, HB 1043, has made it through one of three committees in that chamber. Continue reading…