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Debbie Mayfield's utility bills seen damaging to Vero

STORY BY LISA ZAHNER (Week of February 20, 2014)
Photo of Debbie Mayfield

If municipalities around Florida blame the City of Vero Beach for two bills filed by its state representative, Debbie Mayfield, the proposed ramped-up utility regulations could further frustrate Vero’s already-strained efforts to extricate its electric utility from the Florida power co-op.

In an apparent Hail Mary effort to represent the interests of Vero Beach utility customers who reside outside the city limits, Mayfield introduced one bill focused on city-owned water and wastewater suppliers (HB 813) and another taking on government-owned electric operations (HB 861).

The bills were introduced earlier this month, less than four weeks before the Florida Legislature’s 2014 session opens, and neither has a companion bill in the Florida Senate, or any co-sponsors in the House as of press time.

Even if a veritable miracle occurred and the bills sailed through in the House in record time – provoking the ire of the very cities Vero will need to cooperate in its exit from the FMPA – without a related bill in the Senate, neither measure can make it to Gov. Rick Scott and become law.

Meanwhile, the Florida League of Cities is opposing HB 813 (it hasn’t taken a position yet on HB 861) and has urged its member cities by email to contact their legislators and ask them to vote against the bill.

Though HB 813 deals with water and wastewater utilities, it targets the same basic cohort of cities that own electric utilities and belong to the Florida Municipal Power Association – cities that skim profits from both kinds of utilities to pad their general funds.

League legislative staffer Megan Sirjane-Samples’ summary of HB813 says it “allows for counties to take over a municipal franchise of a water and wastewater utility once the municipal franchise agreement, resolution or ordinance has expired. The county must compensate the municipality for the fair market value of the facilities transferred to serve the unincorporated areas of the county.”

The summary continued by describing the provision that would kick in should there be no expiration date to the service or franchise agreement – that ratepayers could by referendum vote, or written response to a mail survey, choose their own service provider.

“Finally, and most troubling, the bill requires that municipalities who own and operate water and wastewater utilities that provide services either directly or indirectly to unincorporated areas of the county are no longer exempted from oversight of the (Florida) Public Service Commission,” Samples memo concludes.

Indian River County’s franchise agreement with Vero for the South Beach and mainland county water-sewer customers expires in March 2017. Those customers have already overwhelmingly chosen the county as their provider in a written survey conducted in 2012.

HB 861 would bring government-owned electric and gas utilities that purchase power through the FMPA and other public power co-ops under the purview of the PSC.

More than a month before the bills were processed and numbered, the Florida Municipal Electric Association had alerted its members that the attack was coming. The FMEA employs a team of lobbyists who, in previous legislative sessions, have successfully killed any attempts by Mayfield to regulate municipal utility operations.

There’s no reason to think this year will be any different. While Indian River County has enlisted the help of lobbying firm Ballard Partners, the Energy and Utilities Subcommittee through which the bills need to pass has not yet placed either of Mayfield’s bills on its agenda for analysis and consideration.

Mayor Dick Winger takes serious issue with Mayfield’s bills, and on this Tuesday’s council agenda, submitted documents “requesting action by the city council to protect the people of Vero Beach’s interest in the utilities that they own,” in concert with the Florida League of Cities.

“These acts seem to be prejudicial to the interests of our citizens and the viability of the City,” Winger stated in his memo.  “These various bills seem to be politically motivated, and either attack municipalities in general, or the City of Vero Beach in particular, in favor of county governments.”

Councilwoman Pilar Turner, who represents Vero on the FMPA board of directors, said she’s observed pushback already from member cities, especially the City of Kissimmee which, like Vero, has a large percentage of customers outside the city limits.

Yet, Turner said she understands the philosophy behind the bills.”

“The electrical one is still addressing the problem of outside customers without representation and their concerns about rates,” Turner said. “At least it raises awareness that the FMPA needs to focus on the ratepayers. You never hear about the ratepayers, it’s all about what’s for the good of the FMPA.”

If the legislation passed and was not challenged in the courts, the PSC would presumably require each municipal utility to mount a rate case like Florida Power and Light does when it wants to change what what it charges. It’s possible that cities would be able to justify their revenue requirements and their rate of return, resulting in little or no rate relief for customers.

“That is true,” Turner said. “But at least the outside customers would have some review of their rates.”

But with Vero still trying to salvage a full sale of its electric system, requiring cooperation from the FMPA and its members, Turner said, “I think the whole thing is a mess. I thought it was going to be presented as a local bill.”