Fort Pierce Commission discusses counterproposal in negotiations with FPUA
By Eric Pfahler
Monday, October 17, 2011
FORT PIERCE — City commissioners discussed a counterproposal to the Fort Pierce Utilities Authority offer over how to transfer money to the city.
The city and FPUA have been negotiating since August over what money gets transferred to the city. Each year, the city gets 6 percent of the authority's total revenue, which amounted to almost $5 million last year.
But the two sides have disagreed over whether the city should also collect money from the power cost adjustment, which would add about $1.5 million to the city's budget.
The two sides plan to meet, though the time and date have not been set.
Residents' electric bills consist of two parts: the rate and the adjustment. The rate consists of the base rate to run the utility at $42.32 per 1,000 kilowatt hours and the base power cost at $49.52 per 1,000 kilowatt hours. The adjustment is $35 per 1,000 kilowatt hours.
The average customer uses about 1,000 kilowatt hours.
Since 1994, the adjustment has not been included in the transfer.
Commissioners postponed voting on changing the city charter to reflect the city's stance.
FPUA Director Bill Thiess has said the utility believes such a change would require a voter referendum.
On Monday, the two sides made progress after city commissioners responded to the FPUA's offer to move $30 of the $35 adjustment into the base rate. The change would amount to $1 million.
The FPUA board offered a compromise through a 3-2 vote at its Oct. 4 meeting to move part of the power cost adjustment.
City Commissioner Tom Perona and Mayor Bob Benton supported a counteroffer that would move all $35 to the base rate, but hold off on collecting the 6 percent on the last $5 for one year.
But the plan involved the FPUA loaning money to the city that would be repaid beginning in 2015. Commissioners Eddie Becht and Reggie Sessions questioned the need to make loans.
City Finance Director Gloria Johnson said the city should do the calculation based on all of the money, even if it decides to give money back to the FPUA.
"I think we ought to follow the charter, and it says 6 percent of gross revenues," Johnson said.
Staff write Laurie K. Blandford contributed to this report.