Final approvals enable Vero to exit FMPA projects and sell its electric utility
The governing boards of the Florida Municipal Power Agency (FMPA) gave final approval today to agreements enabling the city of Vero Beach to exit FMPA’s power projects and sell its electric utility. The unanimous approvals by FMPA’s Board of Directors and Executive Committee were the last step after the required 19 cities had agreed to Vero Beach’s buy out of its FMPA contracts.
“FMPA and its members have invested significant time and effort to help Vero Beach facilitate the sale of its electric utility,” said Jacob Williams, FMPA’s general manager and CEO. “All the cities worked well together to create a solution that meets the needs of everyone.”
The city of Vero Beach wants to sell its electric utility. Vero Beach participates in three FMPA power supply projects. For Vero Beach to sell its system, the city needed to find another municipal utility to assume its obligations in the FMPA projects.
In February 2017, FMPA presented an option for Vero Beach to transfer its FMPA power projects to other cities. The 13 cities in FMPA’s All-Requirements Project (ARP) said they would consider taking the additional power if compensated for the increased costs and risks.
FMPA proposed that Vero Beach should pay FMPA’s ARP $108 million, which was verified by two independent analyses. As part of the agreement, Vero Beach would transfer its shares in FMPA’s Stanton, Stanton II and St. Lucie projects to FMPA’s ARP.
Since the plan was announced last February, FMPA’s management visited all 19 member cities numerous times to meet with local elected officials and make presentations prior to city votes. FMPA also secured necessary approvals from its bond trustee, credit rating agencies, other financial stakeholders and the primary owner-operators of the generating units.
Now that FMPA has fulfilled its responsibilities and obtained all necessary approvals for Vero Beach’s exit, the Agency will continue to work with Vero Beach to finalize remaining details for closing of the utility sale.