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Shores faces long odds in challenge before Florida PSC


Even as Indian River Shores residents are running out of legal and regulatory venues to plead their case about Vero’s high electric rates, Vero, the Shores and Florida Power & Light officials have agreed to sit down and try to hammer out some mutually acceptable terms for a sale of the Shores’ 3,000 electric customers to FPL.

Last Thursday, in advance of a July meeting of the Florida Public Service Commission, commission staff issued its analysis of the Shores’ petition to open up Vero’s electric territory for review, recommending commissioners dismiss the Shores’ claims of home rule power to decide which utilities are allowed to encroach across Town borders and do business in the Shores.

“We are disappointed by the staff recommendation. We fundamentally disagree with their interpretation of the Florida Constitution, and look forward to discussing our positions with all of the Commissioners on July 7,” Shores Mayor Brian Barefoot said on Monday in a statement released by the Shores legal team.

Vero’s 30-year franchise agreement with the Shores for electric service expires in November. The Shores argues it temporarily assigned to Vero the responsibility to provide electric service and that, as a sovereign entity, it has the right to reassign that municipal responsibility to another utility provider once there is no valid franchise in place.

The Shores says that the home-rule powers granted to it by the state give it a degree of control over what happens inside the Town limits. Vero disagrees, claiming its service territory as awarded by the PSC trumps any franchise agreement – or lack thereof – and supersedes any powers the Shores might think it has to kick Vero out.

One small victory lies in the PSC’s acknowledgement that the Town does in fact have standing to file its petition – something Vero’s attorneys claimed the Town did not have.

Other than on that one issue, the PSC would have to run afoul of its own massive cache of attorneys and consultants to rule in favor of cracking open Vero’s territory. Still, legal teams are scheduled to represent both sides on July 7 in Tallahassee before the five-member panel of commissioners charged with protecting the public interest, as it relates to utilities in Florida.

The PSC has consistently sided with Vero Beach in a series of inter-municipal squabbles, and it’s easy to see why. Vero’s claim that it enjoys a permanent electric service territory awarded to it by the PSC bolsters the PSC’s argument of “exclusive and superior” authority when it comes to divvying up the state of Florida.

City Manager Jim O’Connor said he was not surprised that the staff pretty much echoed Vero’s positions in its white paper to commissioners. “It is what we expected and have said since this process started,” O’Connor said.

Should the PSC agree with its staff recommendation, the Shores could always appeal to the Florida Supreme Court, but so far Florida’s high court also has bolstered Vero’s position with a ruling on Indian River County’s appeal of PSC rulings that did nothing to protect county residents from Vero’s unregulated electric rates.

The Shores and unincorporated county residents have some things in common – namely, the fact that they subsidize Vero’s general fund through the electric rates they pay, even though they cannot vote for the Vero Beach City Council members who run the utility.

But the Shores has long argued that the Town’s home-rule rights under the Florida Constitution are quite different than the county’s rights – claiming the Town has more power over what Vero electric can do within the Town’s municipal borders than the county does in its territory.

Meanwhile, the Vero Beach City Council approved staff and legal time to begin a dialogue with FPL decision-makers and Shores officials that might offer options for bridging the chasm between the $13.6 million FPL has offered for the Shores’ 3,000 electric customers and the $42.4 million figure Vero says it needs to make all of its other customers whole.

FPL External Affairs Director Amy Brunjes suggested her colleagues might have some innovative solutions in the works to provide incentives for Vero to take a harder look at the deal. In the spirit of good faith and cooperation, the Shores Town Council has agreed to end its Circuit Court battle with Vero over breach of contract for charging “unreasonable rates.”