Municipal Electric Landscape
· 33 City owned Electric utilities in Florida
· 32 are FMPA members
· But only 20 own “entitlement” generation assets with the FMPA (Lake Worth and Vero beach are 2 of these)
· 3 million Floridians are customers of government run electric utilities
· The Rates comparing the combined effect of both residential and commercial consumption
· Municipal rates are price unregulated
· None can compete with FPL
· Less than 5 have rates within 10% of TECO
· Only one third have rates within 10% of Duke Energy
· 11 cities charge an additional municipal surcharge to Outside customers (typically 10%) on top of the Inside City electric rate. That effect on outside customer is not included in the above rate comparison. (Editor's note: Glenn is an "outside customer" - living outside the city limits of Vero Beach)
Outside Customers
· 600,000 Floridians are outside customers.
· Of the 33 City owned Electric utilities, at least 24 have outside customers.
· 11 of the 24 charge an extra municipal surcharge (an additional 10%) on top of the Inside City electric rate
· City electric rates are PRICE UNREGULATED
· Cities claim “permanent control” of Outside customers, even after the end of a 30 year franchise agreement.
· Outside customers, through electric rates and municipal surcharges, fund City General Fund transfers, including direct transfers and indirect transfers.
· The combination of unlimited territory periods, unlimited price via unregulated rates and transfers to the cities general funds, is Taxation Without Representation.
Take a look at the website for the FMPA. Their culture is interesting.
They mention “All for one and one for all”. The question is, who do they mean when they say “All”? The FMPA claims it serves the ratepayers as their primary stakeholder (ie the public, the same public who owns the FMPA). Yet any honest look at the rates of these city government utilities compared to the private sector indicates that most city ratepayers are worse off. So who is “All” if not the ratepayers? It is important to note that most of the voting members of the FMPA are city utility directors or other government employees.
Take a looks at these comments:
Barry Moline is the FMEA director. The FMEA is the legislative lobbying arm for the FMPA. Lake Worth is, most likely, still a dues paying member of the FMEA. Vero canceled its FMEA membership.
Barry Moline FMEA: April 2012 http://www.tcpalm.com/news/
Moline writes, “Thus, even after transferring these (FMPA entitlement) assets, Vero Beach must remain a viable electric utility to cover these significant (contingent)liabilities. Not even FPL can take them. In my opinion, this important detail will likely prevent Vero Beach from ever selling its electric utility.”
It appears that the municipal bureaucracies believe that there is never any exit from the “family of munis”. Such an idea seems alien to American ideology that we are a free people deserving of the fruits of our labors.
Oct 2007 GREEN COVE SPRINGS , Don Bowles City Manager http://www.lakeworthmedia.com/
"...they got us held hostage"says city manager Don Bowles concerning FMPA. Green Cove Springs has announced they are exiting from FMPA but got slapped with a $53,000,000 penalty. Green Cove Springs has also discovered that lower cost power supply exists right in their county -- the CLAY COUNTY ELECTRIC COOP that offered them power at a rate 30% below FMPA rates. "But they don't want anyone leaving them," said Mr Bowles, and they have set it up so its too expensive to consider for most municipalities."
I have suggested that there is an equitable solution to exit the FMPA, WITHOUT HARM to any other member city or any bondholder of the FMPA. There may be communities who really like having government run electric utilities and wish to stay with the FMPA despite paying significantly more in city electric rates compared to the private sector alternative (odd as that may be). I have suggested that the Cities (the public) ought to have the right to enjoy the benefits of the FMPA assets for which they have paid. These include Generation, Cash and Investments. Member Cities should be entitled to any equity in these assets without being told that such assets have no value, that these assets can only be transferred to other member cities (who likely have no need for the power) or that such a transfer will include millions in penalties. Again, that solution shall not harm any other member city or bondholder.
![Dr. W. H. Cotton’s ode: “Oh, My Lake Worth, Florida!” [circa 1920].](http://1.bp.blogspot.com/-yhHyCn84ZIQ/WezjlEL-0tI/AAAAAAAAPZ4/CzkhriK6zpEJJ3d9Je1495d49gIhnMlxACK4BGAYYCw/s1600/LakeWorthPioneers.JPG)
