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• • • Carlos Alvarez, Esq. December 11, 2014 Page 8 municipality, a proportionate voice in electing the governing board of their municipal utility. See Ch. 2008-227, Laws of Fla. Specifically, Chapter 2008-227 added subsection (7) to Section 366.04, Florida Statutes, to require each "affected municipal electric utility" to conduct a referendum election of all of its retail electric customers to determine if a majority of the customers are in favor of creating a separate electric utility authority to operate the business of the electric utility. "Affected municipal electric utility" is defined as a municipality that operates an electric utility that: (a) serves two cities in the same county; (b) is located in a noncharter county; (c) has between 30,000 and 35,000 retail electric customers as of September 30, 2007; and (d) does not have a service territory that extends beyond its home county as of September 30, 2007. § 366.04(7), Fla. Stat. (2008). The City is an "affected municipal electric utility" subject to the requirements of Section 366.04(7). In flings before the PSC, the City has admitted that: (i) it serves the City of Vero Beach and the Town, both municipalities in Indian River County; (ii) Indian River County is a noncharter county; and (iii) the City's service area does not extend beyond Indian River County. Furthermore, the City's audited financial statement for 2007 expressly notified the public that the City had 33,442 retail electric customers as of September 30, 2007. Upon information and belief, the City also represented to the PSC and to credit rating agencies that it had in excess of 33,000 retail electric customers in 2007. Prior to passage of Section 366.04(7), consistent with established electric utility industry practice, the City quantified its retail customers by counting the number of separate meter accounts. After Section 366.04(7) became law, however, the City adopted a customer counting method which for the first time counts individuals with multiple meters as a single "customer," which resulted in a number of customers below 30,000. The Town believes that Section 366.04(7) should be enforced here, and that it provides all of the City's retail electric customers -- including non-residents of the City -- a right to vote in a referendum on whether a separate electric utility should be created to operate the business of the City's electric utility. The process set forth in Section 366.04(7) also provides an opportunity, upon approval through the referenced referendum, for the non-resident customers of the City to be served by a separate electric utility authority, the governing board of which shall proportionately represent all of the customers of the City's electric utility. Conclusion The Town has the right and responsibility to protect its residents from unreasonable rates and oppressive utility practices. Although the Town understands that the City is trying as part of this conflict resolution process to reduce its electric rates, City officials have publicly stated that, because of the City's past contractual decisions, its electric rates will continue to substantially exceed FPL's rates into the foreseeable future. Furthermore, City officials have publicly stated that the City has no intention of suspending the oppressive rate -making practices that require the Town and its residents to unfairly subsidize City operations. Consequently, the Town has lost all confidence in the City's ability to properly manage its electric utility and treat its non-resident customers fairly. Accordingly, the Town seeks to exercise its express statutory right to furnish