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Board of County Commissioners March 7, 2011 Page Five 6. Lawsuit to Enforce the 2008 Mayfield Legislation which Required a Referendum. The 2008 legislation was designed specifically to apply to the City of Vero Beach, The City nevertheless determined that the legislation did not apply, and never held the referendum. Dr. Faherty and Mr. Heran are challenging this determination in their PSC case; however, it is unclear whether the PSC has jurisdiction to enforce the legislation. A clearer path to enforcement might be a lawsuit in the local circuit court asking the court to determine that the legislation does apply and to order that the referendum be held. If the referendum is held and a majority vote in favor of a utility authority, an authority would be created 'to operate the City system and non-resident customers would be represented on the governing board of the authority. - 7. Termination of the City's 1987 Franchise. As stated,. the County granted a 30 year franchise to the City in 1987. The County could send notice of intent not to renew the franchise prior to March 5, 2012. However, this will not resolve the electric issues because ultimately it is the PSC and not the County which defines electric utility territorial service areas. Thus, even if the County elected not to renew the franchise; it is likely that the City would still have a right to serve the area under the 1981 PSC order. COUNTY ATTORNEY'S OPINION. It is the County Attorney's opinion that the Board should adopt the following course of action: (1) adopt a resolution expressing support for the positions taken by Dr. Faherty and Mr. Heran in the PSC case, expressing support for a purchase of the City electric system by FPL upon terms that are fair and reasonable, and addressing other issues as the Board deems appropriate; (2) give the City Council and FPL a reasonable amount of time — perhaps to midsummer - to pursue a sale of the utility. City residents have elected an entirely new City Council. The new council. has expressed a strong desire to explore sale alternatives. Best estimates are that FPL will make a decision on whether to present an offer within the next three months or so. Under these circumstances, the City Council should be given an opportunity, without aggressive pressure from the County, to complete the process and possibly negotiate a sale to FPL; (3) monitor, but not intervene in, the Faherty/Heran PSC case, unless it appears that a sale to FPL will not occur. If the County intervenes in the PSC case, the County Attorney believes that a full effort will become inevitable, with resulting significant expense. The County Attorney does not recommend extensive proceedings before the PSC, funded by taxpayer money on both sides, while the prospect of a sale to FPL is still possible. In fact, the County Attorney believes that it might be appropriate for Dr. Faherty and Mr. Heran to ask the PSC to delay their case several more months, until FPL and the City are able to explore sale possibilities; R 4uom )k lndd6ENERAL\B MAgenda MenioMRC-COVB (Electric hs sJ doc 144