Monday, August 04, 2008

Costs weighed in FPL issue --- Decision tabled by City of St. Augustine

Costs weighed in FPL issue

Decision tabled

Publication Date: 07/29/08

St. Augustine City Commissioners said Monday they want more public involvement before they decide to renew a 30-year franchise with Florida Power and Light or buy them out.

The commission agreed that taking over FPL's assets in St. Augustine -- which could cost more than $50 million -- is not a feasible option for the city. But John Regan, city chief operations officer, said the city could continue its service with FPL without going into another 30-year contract.

If the city does that, it will lose $1.4 million in annual franchise fees from FPL, Regan said. That money goes to the city's general fund and would have to be gained in another way, such as taxes, Regan said.

The commission tabled the topic to its Sept. 8 meeting.

The city's current FPL franchise ends in June 2009.

Commissioner Errol Jones asked if not having a FPL franchise would lower city residents' electric bills.

Dave Cobb, of FPL, said yes, electric bills would be about 6 percent lower.

Commissioner Don Crichlow said he was most worried about having such a long-term agreement with FPL without carefully looking into other options.

For example, St. Johns County does not have a franchise with FPL but still uses the company services.

Commissioner Susan Burk said it was a "no-brainer" that the city could plunge into debt if it took over the utilities.

"For us to fantasize about taking it over it is ludicrous. It's insane," she said. "Monopolies are not a bad thing. Utilities are a monopoly."

Few members of the public spoke. Judith Seraphin who said she wanted to hear from staff at a municipality who are running their own utilities.

"I would like to hear another side of it," she said.

Mayor Joe Boles and Commissioner George Gardner both said they wanted to hear more the public on the issue.

"It'd make me feel a lot better if the public got involved," Boles said.

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