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Vero Beach, Shores begin incurring major legal fees in utility dispute

STORY BY LISA ZAHNER (Week of December 24, 2020)

The Town of Indian River Shores served Vero Mayor Robbie Brackett with a breach of contract lawsuit last week after months of talks between Town Manager Joe Griffin and City Manager Monte Falls about utility rates proved fruitless. Now, both sides will begin incurring major legal fees.

Indian River Shores has paid nearly $12,000 so far to local firm Vocelle and Berg, but as Vero water-sewer utility ratepayers, Shores residents will pay not only for their own attorney, but for part of the cost of Vero’s attorney, too.

Vero’s interests are being represented by Thomas Cloud, who heads up the Utilities Division for Gray Robinson, one of the state’s biggest law firms.

According to each law firm’s engagement letters, the Shores is paying Paul Berg $350 per hour and Vero is paying Cloud at least $250 per hour plus expenses.

The crux of the lawsuit is the rate Vero charges per 1,000 gallons of reuse irrigation water, and whether or not Vero was obligated to reduce that rate from 67 cents to 21 cents in January 2019 when Indian River County reduced its rate.

The October 2012 water-sewer franchise agreement between Vero and the Shores states that rates for Shores customers shall be tied to Indian River County Utilities rates. 

Depending on consumption, the rate differential amounts to $300,000 and $400,000 per year to Shores residents, club communities and golf courses.

Cloud has worked for Vero before, in conjunction with GAI Consultants, on various utility matters. Readers might also recognize Cloud’s name as being an attorney representing several Florida Municipal Power Agency member cities over the span of Vero’s decade-long effort to sell Vero electric to Florida Power & Light.

The Shores’ lawsuit sat idle after being filed in September, but now that it has been served, Turner told Vero city officials not to talk about the active litigation with anyone.

The Shores town council has met in executive session to strategize about the lawsuit, and Vero will meet in executive session on Jan. 15 with Cloud. Since Jan. 15 is more than 20 days out from service of the summons and Vero is supposed to respond to the Shores within 20 days, Vero City Attorney John Turner said on Monday “we’ll ask for an extension if we have to.”

Chapter 164 of Florida Statutes Florida Statutes mandates that under most circumstances when one municipality sues another municipality, the parties must go through pre-trial mediation in an effort to resolve the conflict and save the taxpayers the expense of a protracted trial.

Indian River Shores’ Town Attorney Chester Clem and Berg did not respond when asked if this suit falls under the state mandate for mediation, but Turner said “the requirements under Chapter 164 don’t apply if mediation is covered in a contract, as is the case here.”