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• • • Exhibit "B." Likewise, the Franchise Agreement between the Town and the City expressly requires that the City only charge "reasonable" rates for the electric services it furnishes to the Town and its citizens. Ex. A, Franchise Agreement, § 5. 30. The City has engaged in improper rate -making practices that require the Plaintiffs and other Non -Resident Customers to unfairly subsidize City operations that are not related to the furnishing of electric service to customers. For example, upon information and belief: a. The City has diverted electric utility revenues to the City's general revenue fund to cover non-utility costs, including propping up the City's unfunded pension obligations to current and former employees that had nothing to do with the operation of the City's electric utility or the furnishing of electric service; and b. Under the pretense of eliminating a 10% surcharge on the Plaintiffs and other Non -Resident Customers, the City actually adopted an aggressive inverted rate which resulted in a net increase in base rates that disproportionately affected Non - Resident Customers. As a result of these improper rate -making practices, Non -Resident Customers are being forced to subsidize approximately 24% of the City's total budget. These and other improper rate -making practices of the City have resulted in unreasonable and excessive rates, which the Plaintiffs and other Non -Residential Customers are being forced to pay. 31. In order to protect against unreasonable rates, the City has a legal duty to the Plaintiffs and its other electric customers to operate and manage its municipal electric utility with the same degree of business prudence, conservative business judgment and sound fiscal management as is required of private investor owned electric utilities. State v. City of Daytona Beach, 158 So. 300, 305 (Fla. 1934). 7 boP