VERO BEACH – Taxpayers could see the City of Vero Beach and Indian River County governments battle it out in court if they can’t agree on a plan to combine water and sewer systems sometime soon.
At the heart of the dispute is whether the county has the right to take back service to South County residents now on the Vero Beach utility system after a franchise agreement expires in March 2017.
Vero Beach Water and Sewer Director Rob Bolton has said that, as far as he’s concerned, the City will continue to serve South Beach and collect a franchise fee until it is told not to do so by a court.
Bolton also floated the idea last week that, under Florida law, Vero Beach could jack up the water-sewer surcharge on South Beach and Indian River Shores customers to 25 percent instead of the current 10 percent.
Bolton got a legal opinion from attorney Thomas Cloud of the Gray Robinson law firm backing him up.
In that April 18 legal opinion, Cloud points to various agreements approved by the Board of County Commissioners in the 1970s and 1980s that allowed Vero Beach to serve the South Beach customers in the first place.
“I am of the opinion that the City’s exclusive right to provide water and sewer service to the South Beach area exists and will continue to exist unabated whether or not the County’s franchises terminate,” Cloud wrote in the memo to Bolton.
The memo outlined an agreement with the Moorings in 1968 and with the county in 1973, 1980, 1985, 1987 and 1989, and stated that Vero Beach expended money to service the Moorings and other South Beach customers.
The history includes a failed attempt by the county in 1981 to serve the South Beach customers and finally a “1985 Territorial Agreement” awarding Vero Beach the exclusive right to serve the South Beach. That was followed up by the 1987 franchise agreement giving the city the power to collect a franchise fee.
Another agreement was executed in 1989 giving Vero Beach the rights to serve the South Beach, and which Cloud argues “supersedes all previous agreements, except the franchises between the parties, but has no end date.”
Cloud works with GAI Consultants, the firm slated to do hundreds of thousands of dollars of appraisal and consulting work on Vero Beach’s water-sewer system in the coming months.
Upon hearing of talk of a 25 percent surcharge on the South Beach and Shores customers, County Commission Chairman Bob Solari conceded that the surcharge would be legal, but voiced his opposition.
He serves as the commission’s liaison to Vero Beach and the Shores regarding water-sewer matters.
“Imposing a 25 percent surcharge would, however, be morally wrong, and it shows the contempt that Mr. Bolton has for his customers,” Solari said. “It is consistent with Mr. Bolton’s words and actions over the past two years where his prime concern, has not been to serve his customers but rather to preserve jobs in the city utility regardless of the costs to the customers the utility serves and the damage that high utility charges continues to do to the economic viability of our community.”
The county has already given Vero Beach notice of its intent to not renew the franchise agreement in 2017 and County Attorney Alan Polackwich has issued an opinion of his own to back that up.
Polackwich argues the current commission can negate that territorial agreement – that the commission cannot be held permanently to a decision of a former county commission that was designed to work hand in hand with the 30-year franchise agreement.
Polackwich wrote a memo April 5 to County Director of Utilities Erik Olson in response to a question from Olson about whether Vero Beach’s territorial rights to the South Beach are “permanent.”
“My opinion is that (1) the Agreement established service areas only for the duration of the 1987 franchises, and (2) any attempt by the 1989 BCC (Board of County Commissioners) and City Council to establish service areas that would remain in place forever would probably be void, as being in excess of the legal authority of the commission and council,” Polackwich wrote.
Polackwich said he’s reviewed the background material surrounding the decisions and he said there’s no indication Vero Beach or county officials at the time thought they were setting anything in stone.