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Shores to discuss water-sewer proposals on Monday

STORY BY LISA ZAHNER, (Week of October 20, 2011)

The Indian River Shores Town Council, instead of moving forward on the water-sewer utility dilemma now, decided to cancel a planned Oct. 24 workshop on the topic.

Shores Town Clerk Laura Aldrich said she'd gotten a consensus around lunchtime Monday not to hold the meeting. Any updates on the water-sewer issue that need to be brought before the council would be considered at the regular Oct. 27 council meeting.
In an Oct. 4 response to County Administrator Joe Baird, Shores Mayor Tom Cadden said he wants to table negotiations for rest of 2011.

"It would appear that future negotiations between the Town and County should be more or less "placed on hold" pending County and City discussions that could lead to a County purchase of the City water and sewer systems," Cadden wrote. "It is my expectation that we should have a clearer picture of possible purchase issues before the end of the year, and I would suggest that further details of a possible agreement between the Town and County can wait until we see how the City-County talks progress."

In addition to the expressed reasons stated, the move to delay inking a water-sewer deal would serve two other goals.

First, it will allow more Shores residents to return to town to participate in the ongoing debate about what the Shores should do about its water-sewer utility. What's been severely lacking at two years of meetings on the water-sewer issue is any participation from Shores homeowners and ratepayers.

Secondly, it will place the Vero Beach Electric issue in the forefront of local political discourse for the next few weeks.

Although the water-sewer decision carries marginal consequences for Shores residents, the electric issue could mean millions of dollars, not only in savings to home electric bills, but in the sizeable savings the county and school board and hospital district would experience on Florida Power and Light rates. Barrier island residents pay nearly 50 percent of the total property taxes collected by the Board of County Commissioners and the School District of Indian River County.

Prior to their September regular meeting, council members were provided copies of a legal opinion from the Tallahassee law firm of Nabors Giblin & Nickerson, effectively saying the Shores would owe next to nothing to Vero for utility assets at the end of the 30-year franchise agreement in November 2016.

The council also had in hand a three-page letter from County Administrator Baird intended to "clarify and expand upon" the county's standing offer to become the Shores water-sewer utility provider.

The letter made it clear that the county wants the Shores as customers. Baird's letter also warned that, if the Shores chooses to sell out to Vero, that it would have no protection from Vero officials turning around and selling the Shores assets to a company to set up a utility authority.

The county proposal, on the other hand, suggests that the Shores simply grant a franchise to the county, allowing it to use the Shores infrastructure for 30 years, with the assets reverting back to the Shores.

"This will provide the Town with the freedom of choice in selecting any future provider, should the franchise terminate," Baird wrote.

The offer from Vero would be for the town to turn over all its assets to Vero for a small consideration – the elimination of the 10 percent surcharge tacked onto water and sewer bills.

Baird noted in his letter that this is really no consideration at all, because Vero would not, on a competitive basis, be able to continue to collect that surcharge. The other option being offered is county rates as consideration for the utility assets – still, not much of a purchase price for millions of dollars in pipes and equipment.

In the letter, Baird explained that any utility authority set up would be a Vero project on its own, that Indian River County has no efficiencies to gain by creating a utility authority with Vero.

"The Board of County Commissioners is elected by and represents all residents of the County, including those who live in the municipalities," Baird wrote. "The County does not believe that there is anything to be gained – other than additional bureaucracy, duplication and expense – in creating a second board of commissioners elected by the same residents, to govern a water and wastewater authority."

Vero Beach City Manager Jim O'Connor told the Vero Beach Utilities Commission last week that the city has already put all water-sewer negotiations on the back burner for the time being. He said he has recently met with two private companies about possibly coming in to run the Vero Beach water-sewer utility.

County officials, though they maintain that they are ready to strike a deal with the Shores at any time, also agree that there is no rush to act, as the Shores franchise agreement with Vero must remain in place until November 2016. The deal would not alter the county's existing water-sewer business plan as the county already has excess capacity to serve the Shores.