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Town of Indian River Shores – City of Vero Beach – Indian River County Electric Utilities Mediation Page 4 May 1, 2015 The Town Mayor Brian Barefoot hoped to resolve the issues today to avoid the costs and risk of litigation. He recalled at the December 17, 2014 Mediation Meeting, it was agreed upon to continue abatement of the Town’s lawsuit, during which time the City would pursue opportunities to reduce rates and provide concrete recommendations for doing so. The Town Council voted to further extend the abatement an additional 75 days to expire on May 15, 2015, to give the City time to explore these opportunities to continue negotiations with OUC and FMPA. Mayor Barefoot expressed his disappointment with the FMPA’s continued refusal to be part of the solution, their mismanagement, and their performance or lack thereof, before the Joint Legislative Auditing Committee. The Town continues to be disappointed that the City has not chosen to aggressively pursue amendments to the FMPA contract, or even attempted to cancel the contract through every legal means available. Mayor Barefoot compared FPL electric rates to the City electric rates and he explained when the cooling off period began, the rate disparity between the two electric utilities was approximately 25%. It has increased to almost 31%, which leads the Town to believe the City has no control over its electric utilities destiny. He indicated FPL has opened the door to discussions with the City about a potential sale of utility assets in the Town, which could solve the rate disparity crisis in the Town, provide the City with an influx of funds to enhance its financial viability and potentially provide cost reductions to be passed on to all of its remaining customers in the City and the County. Terry Deason, the Town’s Electric Utility Consultant, referred to his handouts on the Town of Indian River Shores Buyout. He reiterated the Town does not know what a buyout would be if one would take place, and explained there were various moving parts to be considered. He reviewed the information on the Transfer Coverage Range Analysis and indicated the Town was not taking a position on the transfer, whether it was the right thing to do or not. However, the impacts of a buyout on various levels could be beneficial. Mr. Deason turned the focus to the theoretical amount of savings in debt service payments that could be achieved on the buyout bonds. He emphasized that the Town felt strongly, given what they knew about other amounts of buyouts of utilities on a per customer basis. The Town presented an opportunity to the City for an infusion of capital dollars to be used as they see fit, whether it be a rate stabilization fund or cancellation of the OUC Contract. Mayor Barefoot summarized the $542,000 on the transfer coverage range analysis handout, which was the amount of the transfer lost without the Town’s customer base. Amy Brunjes, Area Manager with FPL, stated that for the last seven years, FPL has been focused on a whole Vero Electric sale and believed it still could be achievable. She pointed out that FPL continues to look for solutions to bring lower electric rates to as many of the Vero Electric customers as possible. She felt a sale or acquisition of the customer base in the Town of Indian River Shores was achievable and would not negatively impact the Vero Electric customers.