VERO BEACH — Both Florida Power and Light and the City of Vero Beach confirmed Thursday that a plan to pay $52 million to help extricate Vero Beach from some of its contractual obligations is still very much in play.
Contrary to a report published Thursday by Scripps Treasure Coast Newspapers, FPL Spokesperson Sarah Gatewood said, “We have not taken anything off the table.”
Last week, FPL External Affairs Director Amy Brunjes did acknowledge that FPL was talking to the Orlando Utilities Commission about possibly stepping in to take over Vero’s power supply contracts. But there was no mention of FPL’s intent to rescind its offer of $26 million plus another $26 million in interest-free loans to bridge the financial gap needed to close the sale of Vero electric.
City Manager Jim O’Connor Thursday afternoon characterized the Scripps story as “not entirely accurate” and said that the $52 million has simply been put on the back burner while Vero officials and attorneys work to quantify other parts of the deal with the Florida Municipal Power Agency electric co-op.
Still unresolved, O’Connor said, are issues about potential “stranded costs” to remaining FMPA members after Vero’s exit, credit enhancements being sought by FMPA to protect its bondholders, and finally, the impending liability of what’s referred to as the Taylor Swap bond options.
The FMPA bought options to secure a favorable interest rate on bonds it intended to issue for a Taylor County coal-fired power plant. Though the project was abandoned and never permitted, the FMPA is still on the hook for those options, which could amount to hundreds of millions of dollars.
It’s debatable whether or not the city has any liability with regard to the Taylor Swaps as Vero was no longer accepting power from the FMPA’s All-Requirements Project when the deal was finalized, but that still must be settled.
City officials met with the FMPA on Wednesday in hopes of forging “a path forward” to bring all parties back into active negotiations. Talks had reached a stalemate after a flurry of letters back and forth between FMPA and FPL in March.
O’Connor said what came out of Wednesday’s meeting when he, Mayor Dick Winger and City Attorney Wayne Coment went to FMPA’s Orlando headquarters to meet with top officials there was not just one path, but actually two parallel paths.
“What the FMPA folks agreed to was that on issues related to the city’s contractual obligations with FMPA, they would be cooperative and meet with the city, but not with FPL on those matters,” O’Connor said. “But on issues that FPL is involved with, that they would meet with FPL.”
FPL President Eric Silagy had expressed in his correspondence to FMPA a desire to strike a deal that would encompass all the remaining loose ends that need to be tied up to make a closing happen.
FMPA officials bristled at tying any cooperation on the city’s long-term membership contracts in the power co-op with the power supply agreements to which FPL is attempting to broker out to another entity so Vero would not have to buy that power at prices higher than market.
Now the various aspects of the Vero sale will have to be negotiated piecemeal, according to O’Connor.
