Comment Up
The Finance Director sent out an e-mail--
There appears to be renewed discussion about the possibility of selling the Electric Utility. In order for you to have some idea of the complexities surrounding that idea, I asked the Utilities Director to draft the attached memorandum.
The memo discusses many of the issues and considerations surrounding discussion selling the Electric Utility and is staff’s attempt to make sure that you as policy makers have as much information as we can furnish. There has been a subsequent Public Records request by a citizen and this memorandum (2 pages from Becky Mattey) was included in the information given to that individual, so I wanted to make sure you had the same information.
Thanks.
Steve Carr
Finance Director
..................
Who in the heck on the Commission wants this discussion?
The City is in the process of converting participation of the All Requirements Project of FMPA to the Contract Rate of Delivery (CROD). An RFP for power purchase has been issued and responses will be submitted and reviewed over the next three months. Public discussion about the sale of the electric utility at this time will jeopardize the bid process and likely prevent or dissuade bidder response. The Utility has invested in excess of $500,000 in this process. It is imperative that the process continue unhindered. Nine bidders have been qualified and there is every indication that positive short and long term responses will result. The January 1, 2014 CROD deadline is fast approaching. A short term power purchase agreement will provide the City ample time to convert the FMPA participation as well as consider the points listed above and develop a comprehensive Request for Proposal for the sale of the Electric Utility that guarantees the City maximum price and benefits.
22 comments:
Last month, Florida Power & Light Co. filed a request for a base rate increase of $6.97 a month that would take effect Jan. 1. We need this money from the Utility to operate our city.
It was Amoroso.
WHAT DOES MR. CARR MEAN BY THIS? 'Public discussion about the sale of the electric utility at this time will jeopardize the bid process and likely prevent or dissuade bidder response. The Utility has invested in excess of $500,000 in this process. It is imperative that the process continue unhindered.'
Let's get the Utility to give us the projections--
Sue Hersey needs to come before the public and give us the best, worst case scenario. Let's not have totally unqualified commissioners pushing to sell our electric utility.
The blurb on the bottom of this blog was an excerpt written by the Utility Director.
Wasn't Ms. Hersey involved with Vero Beach Utilities? How did that work out for Vero Beach?
Since you are getting emails sent to Commissioners, please post the 2-page response from Ms. Mattey.
Why not just ask your favorite commissioner to forward it on to you? If that doesn't work, I would be happy to send it to you in an e-mail. I am not going to print the entire document here. Thanks.
I'll ask Commissioner Mulvehill for it as she is my commissioner. If that doesn't work, I email you.
If you and your blog followers are against selling the utility because.....let me guess, CONTROL then the best thing for the city to do is sell it because you're always wrong about everything else no matter how many times you try to rewrite history.
I am all for getting the FACTS first before of even thinking about selling off our electric utility or any other asset. We don't have any facts yet.
Aside from all of the hype, it takes a vote of the people to SELL OFF OUR UTILITY.
This is not just about CONTROL. It is all about selling off a valuable assets that someone out there might want to buy at less than it is worth. We still owe a heck of a lot of money on the Bond.
Selling the utility comes up every 4 years or so by some administration and some politicos who always think they know better than our utility director.
Can we please just get all of the details--I would like to know who dreamed this up this time.
So, please stop trying to invent history. You don't like what I write--please do me a favor, don't come over here and be rude.
Re-writing history, isn't that what Wes and all his cronies do? He sure is allowing all the attacks against you Lyn. What is his problem?
It's called, birds of a feather and just wanting to hear your own voice. It's politics, folks. One side is just nasty.
So everyone on this blog is going to tell me that FPL is more expensive than our great LW Utilities?!?! That's just crazy.
I have lived in LW on and off for over 20 years and currently for the past 10 years. I also spent most of my life in Palm Beach County. I have NEVER ONCE heard a positive comment about LW utilities. Since I was 10 yrs old, people used to say "don't ever move the LW, the utilities will kill you." Now, 30 years later, same old story. And you people think that is somehow going to magically change? What's the definition of insanity ?... doing the same thing over and over again expecting a different result. So anyone who advocates for keeping LWU and claiming that it will eventually get better is, well, insane.
Just admit it. We have the worst, least reliable, most expensive utility service in the State. LWU is HORRIBLE. I challenge one person to give me a feel good story about their experience with the infamous LWU. FPL could quadruple their rates and it would still be cheaper and more reliable than ours.
Lake Worth is not an island. We live in a community connected to many other communities. Having our own utility is nothing more than an illusion that we an independent city. Until LWU is gone, gone, gone, forever dissolved, this town will have a big black eye and potential home buyers and businesses will continue opt for other cities over ours. Ask any realtor who works in LW how often people come to them and say "find me a house anywhere but LW, I don't want to deal with the utilities." Or, "I love the city, but can't deal with the utilities."
FPL is constantly given kudos for being one of the most efficient utilities in the country, one of the leaders in alternative fuels, one of the best run utilities, so what's the problem?
Selling the utility is not selling out our city. Keeping the utility is what is selling us out. We all get bent over and screwed every month. How can you really argue in favor of LWU???? I'm totally confused by the comments on here, but maybe that's a sign that I am not insane. Pheww, I was starting to wonder.
Nobody likes Tom Ramiccio, but he made one good point on his campaign... SELL TO FPL.
Well, if you really wanted to stand up to your convictions, you would have posted under your name. As anonymous, it is just another rant.
NO ONE SAID that FPL is more expensive than LW Utilities.
Also, we DO HAVE RELIABLE service. Are you still living in the past?
All I have said, is provide all of the facts, pro and con about it and also let us all know how we will operate our city without the money from the Utility. Show us the Plan instead of some crazy solution as selling our Utility to an entity that will never pay us what it is worth. Do you even know what we have spent on the upgrade and what we owe? Do you even know the cost of a kwh?
Let's get the facts and go from there.
Lynn,
To keep our Utility Company because we need it for the money to run our City is a cop out. We can no more run a Utility than we can run a pan handler out of Town. You ever ask yourself how our neighboring Cities are able to provide for their residents without a Utility? I'm really hoping this new commission can really turn this town around. We need new ideas on how to support ourselves without taxing our Citizens to absolute death.
Sylvia,
I have asked that question several times. I have asked how can a city like Greenacres that has nearly identical demographics, run its city more efficiently with NO Utility? They also have their own police and fire. This new commission can't just willy nilly decide to sell our electric utility, and to even entertain a presentation on the subject, is premature at best. This came out of left field from someone with absolutely NO knowledge other than, gee our rates are too high. We know that and we need to understand why that is so.
Please review this info - where's Coakley and the LWU info he has?
only 2.1 BILLION dollars this time
Nextera is FPL on Steroids. They will buy up this bankrupt Company funded with Billions of taxpayer dollars!
I want FPL like I want a stick in my eye!
"That's right: one ward of the state, bailing out another ward of the state, all to reduce those evil carbon emissions.
Although that is not all. NextEra is also a subsidiary of the publicly traded, albeit with very private investors, NextEra Energy (NEE).
Which means that every dollar extracted out of Solar Trust via the DIP, and ultimately via a Credit Bid in which NextEra will acquire the STA assets at pennies on the dollar, will go straight to NEE's shareholders. Who are these shareholders you ask? Here they are: spot the odd one(s) out."
http://www.zerohedge.com/news/worlds-largest-solar-plant-21-billion-energy-department-loan-guarantee-files-bankruptcy
And that is how in crony America taxpayer money goes from one insolvent pocket, to another, to Wall Street, all under the guise of idealistic pursuits and clean energy.
There is more to this story but we will stop here as we have had enough.
There's no quick & easy answers to any of these questions, but there is alot we can learn from those who have already gone down this road. Ask Vero how signing a short term power purchase agreement has cost them already. Their rates have in...creased by switching from their FMPA agreement to their short term power purchase provider, Orlando Utilities Corp. Plus, if they cancel their new contract with OUC it will now cost them MILLIONS in early termination cost. Their short term purchase agreement was recomended and negoitiated by the same Boston consultiant that we have hired to negotiate us to lower electric rates. Vero's short term provider contract could be the deal breaker in their negotiations with FPL. We the rate payers need to be a part of this major decission.
Lake Worth has superior reliability compared to FPL. In other words, FPL customers experience more outages, and when the lights do go out, for FPL customers they stay out longer. If we sold our Utility, the city of Lake Worth would have to raise taxes to the max, have special assessments galore in order to replace the lost revenue from the Utility.
Can we please leave this up to the experts? That is why we hire them. We don't know what's up here and let's not pretend that we do.
There are many in LW that are glad the people united and didn’t listen to the expert that said we could re-start our police force. The voters last November also said the experts were wrong when the fire and street light assessment were recommended. I know we’ve already agreed to spend $500,000.00 on another out of town expert and I for one do want to hear what her recommendations are before the city signs another contract. In Vero even their commissioners didn’t get to see all the RFP’s. They we’re filed away out of town and it took filling legal actions to finally get them back. Lynn, I know you to well to know you’ve been a champion for city business in the sunshine, transparency and for elected officials to listen to the people who elected them to serve. As far as reliability goes where have you’ve seen a comparison between the reliability of LWU & FPL. Sure FPL has more outages than we do, they serve a lot bigger service area and customer base than we do. When our rate payers are paying 40% more than FPL you might hope our reliability was better, and it has improved but it can’t be any better than theirs.
My understanding is that the Public Utitities Commission, which regulates rates, will require FPL or any other buyer of a local utility to recoup their investment from the rate payers of the acquired utility and are prevented from raising rates on any of their other customers to pay for the deal.
This means that were Lake Worth to sell the utility, our rates would go up until FPL (or another buyer) had all their acquisition costs back in their coffers and out of the now empty and asset deprived pockets of the citizens who were suckered into this "deal".
We would lose all the revenue from the utility which now supports general fund essential services, and we would no longer be entitled to FEMA funds to repair damages to our utility from the hurricanes which occasionally visit us.
In 2014, we will be out of FMPA and buying some power from a different provider at estimated 25%lower rates.
We will also be able to produce our own power-we have 85 megawatts capacity and use 90 megawatts at eak, and with the price of natural gas at a 12 year low of slightly over $2, our rates can be substantially lower, since one of our 3 generators can replace oil usage to run on natural gas and another already runs on natural gas.
This will further bring down the rates.
Our 2002 Commission were tricked into the FMPA contract by their spokesman's influence on a gullible Mayor and Commission. Thank God we rate payers have only 20 months and 20 days left.
Greg--You can get the comparables from LW Utilities.
Next, there was a huge and successful effort by Mary Lindsey to keep PBSO. It was one of the most successful political campaigns here in Lake Worth that I can remember. Kudos to her and her cohorts. However, I was for keeping our own police department as well as our fire department.
Open and transparent is good and in most cases the only way but sometimes, especially when you are in negotiaitons, it is best to keep some things behind closed doors and close to the breast. You don't show your hand if you expect to get the best results in the end.
Not one commisisoner can do anything with our Utility. It is OURS. And to try and put something like this on an Agenda for discussion is really unbelievable.
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