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Present for the County were the County's Outside Counsel Floyd Self from Gonzales, Saggio, and Harlan LLP, Tallahassee, County Attorney Dylan Reingold, Commissioner Peter D. O'Bryan, and Deputy Clerk Terri Collins -Lister. Mediator Alvarez stated that the conflict between the Town, the City and the County fell under the Florida Governmental Conflict Resolution Act as set forth in Chapter 164 of the Florida Statutes. He explained mediation was a conversation between parties in which a neutral party gets involved to help them understand the matter better and to come up with ideas to resolve the conflict. He made it clear this was not an adversarial proceeding, but a collaborative effort from all parties. He added that some mediations could be solved within a day; however, some took more effort and any agreement reached during session would need to be taken back to their respective government bodies to be voted on. He discussed two important ways of negotiating: 1. Interest -Based Mediation - the position of the parties and the process which begins with understanding the problem and identifying the interests that underlie each side's issues and positions. 2. Analyze best and worst alternatives to any settlement proposed - the best and worst alternatives to a negotiated settlement and the parties needed to look at the time put into mediations, as well as the costs, time, relationships of parties afterwards involved in litigation. OPENING STATEMENTS ON THE ISSUES IN CONFLICT Mediator Alvarez turned the mediation over to the Town's, the County's and the City's representatives to give their opening statements, and said he would begin with the Town and the County, then the City of Vero Beach. The Town of Indian River Shores' Opening Statement Bruce May, the Town's Attorney touched on one part of the City's mediation which suggested the City may have misunderstood the Town's fundamental concerns. He referenced in the mediation statement by the City, the City stated the Town's dispute was really about their desire for lower electric rates. He added, while reasonable electric rates were important to the Town and its citizens, the City's history of extremely high rates and its disenfranchisement to the Town and its citizens were really just symptoms of a much more fundamental concern of which the Town believes the City has no real control over its destiny, electric utility and electric rates. He explained as part of the conflict resolution process, the parties participated in a series of local meetings in efforts to resolve the dispute. He said what was clear: 1) the City owns the electric utility which it has contracted to sell to Florida Power & Light Company (FPL), and the City said they were powerless when it came to making the sale happen; 2) the Town applauds the City for trying to lower its electric rates. The City confirmed it simply cannot Town of Indian River Shores - City of Vero Beach - Indian River County Electric Utilities Mediation December 17, 2014 Page 2