Attorneys for the Town of Indian River Shores last week appealed a ruling by the Florida Public Service Commission which failed to remedy what town officials claim would be an illegal utility operation within its borders after Vero electric’s franchise agreement expires the end of this week.
The Town, petitioning the five-member board of appointed utility regulators in Tallahassee as a consumer of Vero electric service, has asked the PSC for an “expedited administrative hearing” on the matter.
“While constitutional issues sometimes can be complicated, this one is not. The constitutional constraints on the City’s extra-territorial powers are based on a common-sense principle, namely, one municipality (the City) cannot unilaterally impose its municipal will on another equally independent municipality (the Town), unless the Florida Legislature expressly grants those unilateral powers to the City,” Mayor Brian Barefoot said last week.
The PSC heard arguments in September from Shores attorney Bruce May of Holland and Knight, from Vero’s attorney, Robert Scheffel “Schef” Wright of Gardner, Bist, Bowden, Bush, Dee, LaVia & Wright, plus a handful of Shores residents who delivered impassioned pleas as private citizens and utility customers.
The commission voted 4-1 to approve its legal staff’s recommendation to rule against the Shores, and issued a written ruling in early October. The Town’s appeal was filed on Oct. 25, the final day to do so. Town officials had held a “shade meeting” to discuss the Shores legal strategy.
In its appeal, the Town reiterates its original arguments that the PSC may withdraw or modify territorial agreements, that the Town as a customer has standing to request such a review, and that for Vero to “exert extra-territorial powers” outside the city limits and within the Town limits without the Shores’ permission after Nov. 6 violates the Shores’ home rule powers under Florida law.
“As an incorporated municipality, the Town has a right to be protected from the unilateral exercise of extra-territorial powers by the City in violation of Article VIII, Section 2(c)of the Florida Constitution,” the appeal says. “The Town thus has a substantial interest in seeking relief to ensure that the City’s conduct is compliant with, and the Territorial Orders are modified to conform to, the Florida Constitution as such conduct and orders relate to the City’s unilateral exercise of extra-territorial powers within the Town’s corporate limits.”
If the Town continues to get no relief from the PSC, it may appeal to the Florida Supreme Court. Another option that has been discussed is to file a federal antitrust lawsuit against Vero Beach as an “unregulated price monopoly” if the PSC is not willing to address the issue.
Vero claims, and thus far the PSC and the courts have affirmed, that the city has both the right and responsibility to serve its entire service territory – including the Shores and the unincorporated county – regardless of the existence of a valid franchise agreement. The county has taken issue with this as well, but they have a few extra months to deal with it, as the county’s 30-year franchise agreement with Vero expires in March.
Vero has approximately 3,000 customers in the Shores, which Florida Power & Light had offered to purchase for $30 million cash, but that offer was not accepted and subsequently expired on Aug. 25.
Both the Shores and Indian River County have formally notified Vero that they would not be renewing their electric franchise agreements. Shores residents and officials are supporting three candidates for Vero Beach City Council who have vowed they would vote to sell the Shores customers for $30 million, an action that would end the Shores’ legal battles with Vero at the PSC and elsewhere.