Customers voice concerns about proposed Vero utility rate hikes

By Lisa Zahner

VERO BEACH — Michelle Seavers has watched the City’s government in action on television, but had never attended a City Council meeting in person beforeTuesday, when she came to speak against the proposed water and sewer rate increases.

“I see people every day who can’t pay their utility bills,” said Seavers, who works with the homeless and others in need. “They can’t afford to eat, can’t afford to pay their electric bills and afford their medicine. They’re going to food banks.”

The City Council voted 4-0 (Mayor Sabin Abell was absent) to hold a public hearing on the rate increase on the council agenda for the 4 p.m. meeting on Sept. 15. Consultant Henry Thomas of Public Resources Management Group was on hand to answer questions about the proposed “base case” rates, which were recommended after the City undertook its first utility rate study in 18 years. Thomas said the City needs the proposed 7.5 percent increases in water rates and 29.5 increases in sewer rates to cover operating expenses, capital and renewal needs, debt service payments and other revenue requirements.

One of those other revenue requirements is a sizable transfer into the general fund of the City. Plus the water and sewer departments pay a hefty amount for every one of the water and sewer utility’s 160 employees to help cover the costs of the City Manager, City Attorney, Finance Director, City Council, City Clerk and other administrative staff, as well as City Hall operations.

Vince DeTurris came to the meeting representing himself, but said he also believes he represents the feelings of the 4,327 City electric, water and sewer customers who live outside the City and belong to the South Beach Property Owners Association.

“I don’t envy your task, but I understand that you have enough business sense to realize that we’re in a crisis,” he said. “The utility is bankrupt.”

The water and sewer utilities have been running a “negative cash balance” according to City officials, since the beginning of the summer and the electric utility has drawn a $14.5 million surplus present in October 2008 down to nothing. The temporary six-month additional power costs adjustments which continue through the end of December are designed to refill the utility’s coffers. More than $1 million was spent to pay off a settlement for the unauthorized use of Florida Power and Light transmission lines by the Florida Metropolitan Power Agency, our power broker, and the balance was used to operate the system and pay unprecedented fuel costs for the natural gas required to produce electricity.Vero Beach resident Tom Maher suggested the City take steps to investigate options of getting rates and costs under control.

“The rates are what they are, the most important part is where this goes in the future,” he said. “The City should establish a citizens’ board and empower that panel, give them the economic tools they need to hire consultants or whatever to analyze this and come to a decision.”

Some of the options discussed by other members of the public who spoke include selling the power plant, getting a referendum on the ballot allowing residents to vote their choice regarding water, sewer and electric utilities and consolidating some or all utility services with the County government.

In regard to the rate increases on top of the more than 20 percent hikes in electric bills customers have suffered under since June, Vice Mayor Tom White, who ran the meeting in Abell’s absence, said he hears from rate constituents every time he is out in public. White said local business owners and especially residents who are out of work or are on fixed incomes are hurting from higher utility bills.

“We just can’t keep going to the trough for water, there isn’t going to be any water left,” White said. “We should have been raising the millage rate a little each year, we should have put in a small increase and gone back to rollback.”

Increasing the City’s millage rate is not possible at this point, as the maximum millage of 1.93 has been approved by Council and has been reported to the Florida Department of Revenue.

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