Old guard makes late bid to thwart Vero electric sale

The sale of Vero Beach electric to Florida Power & Light might represent the city’s future, but next week’s hearing before the Florida Public Service Commission is starting to look like Throwback Tuesday, with former mayors Tom White and Jay Kramer filing testimony opposing the PSC’s approval of the sale.

White and Kramer are probably the highest profile anti-sale voices from the past testifying to bolster the case of the Civic Association of Indian River County, which is objecting to the deal – though former councilman Ken Daige and longtime utilities committee member Herb Whittall are both set for cameo roles.

The attorney representing the long moribund Civic Association is one-term councilwoman Lynne Larkin, so it will be like a big ol’ reunion in Tallahassee of all the people who fought selling their beloved electric utility for more than a decade.

In his statement summary, Kramer says: “A higher public interest exists than merely the vague promise of lower rates, that of making an informed opinion based on facts.”

“The facts set forth by FPL about the rates and fees being charged are not supported by the facts and call into question the alleged benefits to the public interest of a sale,” White’s summary says. “The [Civic Association] … where I’ve been a member for many years, has always spoken about it.”

Anti-sale activists claimed during their time in office that rate disparities between Vero Electric and Florida Power & Light were exaggerated, and that one day soon, Vero’s rates would be the same as or less than or FPL rates.

That much-anticipated day never came, and White’s City Council entered into a wholesale power deal that ended up only making Vero’s long-term entanglements even worse.

County Attorney Dylan Reingold said Kramer has so far not made himself available to be questioned on his statements. Reingold will be representing the county next week. Bruce May of Holland and Knight will be representing Indian River Shores. FPL will have its legal team there and Vero will be represented by attorneys from the Carlton Fields law firm that has negotiated and shepherded the transaction these past two years.

Current Vero Mayor Harry Howle is staunchly behind the sale. “I know, beyond a shadow of a doubt, that this sale to FPL is the will of our community. Despite the protests of a small few who appear unhappy with the political process, we shall continue moving forward, not back,” Howle said Monday.

“I believe the PSC knows this too. So, we look forward to the hearing as an opportunity to reiterate this and the very important fact that this sale will benefit not only Vero Beach but all of FPL’s existing customers.”

Indian River Shores Mayor Tom Slater said he’s optimistic going into next week’s proceedings. He sees the PSC approval of the sale as solving three big problems for the Shores.

Slater says the Shores is in the electric battle for the long haul, wherever that might take the town. Taxpayers have already spent more than $1 million in legal fees on regulatory efforts and litigation in an effort to get the Shores off Vero’s system. “Having the PSC make a fair settlement means the suits would be dismissed, plus it would take care of the issue of having the town divided, 75 of the population on Vero electric and 25 percent already on FPL,” Slater said. “It would also resolve the issue of two different rates being charged in the town, higher rates on the Vero system than FPL rates.”

A delegation from the Shores, including former mayor Brian Barefoot, is traveling to Tallahassee next week, hoping to have a chance to speak. “It’s worth it to fight for our community and that’s why we’re going,” Barefoot said.

A pre-hearing conference was set for this Wednesday, with a defined, six-fold purpose – simplifying the issues;  identifying the positions of the parties; attempting to identify admissions of fact to whittle down disputed points; identifying exhibits to be admitted into evidence; establishing an order of witnesses; and finally, considering other matters “which may aid in the disposition of the matter.”

All the parties filed pre-hearing statements laying out their positions on 20 different issues, large and small, from whether or not they think the three objectors – Brian Heady, Michael Moran and Larkin’s Civic Association – indeed have standing, to whether or not Vero’s situation represents  “extraordinary circumstances” and what they think the PSC should do.

The 3-2 approval of the sale by the PSC in June was based upon a finding of “extraordinary circumstances” that would allow FPL to pay significantly more for Vero’s system than it is technically worth.

The Office of Public Counsel, which said it would not preemptively object to the PSC’s June 5 vote, has since jumped into the fray and hired a consultant who argued that Vero ratepayers should reimburse the 4.9 million existing FPL customers for a $116.2 million acquisition adjustment.

By some calculations, that figure represents the difference between the $185 million FPL is paying and the market value of the nuts and bolts of the system and its nearly 35,000 customers.

In its statement, the OPC asserts that, “Granting FPL’s rates and service to COVB customers may be in the public interest; however granting recovery of the acquisition premium as proposed will harm the general body of FPL customers.”

That was also the argument set forth by the Florida Industrial Power Users Group prior to FIPUG dismissing its objection.

The PSC hearing is set for all day Tuesday, with general public comment scheduled for 5 p.m. There will be an additional hearing day for evidence and testimony on Wednesday, if needed. After the hearing the PSC staff will weigh in and a formal ruling is expected before the end of 2018.

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John Cocktostan October 9, 2018

Meeting has been delayed. Update story.

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