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City-owned electric utility punted to next Pensacola mayor?

City of Pensacola

If the city of Pensacola ever decides to set up its own power company, it appears it won’t be until after Mayor Grover Robinson leaves office.

The Pensacola City Council has floated such an idea, its interest ranging from negotiating a franchise agreement to looking at a possible takeover.

“Certainly at a time when your materials are as high as they’ve ever been in the material shortage market; when your labor’s as short as it is in the labor shortage market, now would be the worst time for us to evaluate that,” said the mayor during this weekly news conference at City Hall.

He added that the biggest sticking point is whether or not the city should be allowed to charge more than six percent for its franchise fee with FPL.

“In an enterprise [zone] situation, the city shouldn’t be dictated to on what it can do,” said the mayor. “I don’t disagree in a lot of different ways, but at the same time that franchise fee – as I think we’re all finding out – it doesn’t come from some magical place. It comes the people who live in this community. And it makes power more expensive if we go up on it.”

Last summer, Robinson rejected such a hike -- thought to be to about ten percent -- as he and other city officials met with Gulf Power executives, before the utility officially became part of Florida Power and Light.

“And we actually did feel like we were fairly close; we still had some things that we were dealing with,” he said. “Liability that we sent back. But for the most part we had kind of narrowed some things down. What came back after that, I thought the legal team at FP&L did a disservice to those negotiations. They really went backwards.”

That involved what the mayor called “petty language” that was not in the original agreement, and a requirement the Pensacola officials had to travel o south Florida to argue their case.

“[It] seemed more like a petty negotiation tactic than actually moving it forward; I didn’t care one way or the other,” said Robinson. “As I expressed to you last fall – it didn’t matter to me if we get a deal done because we have a deal. It’s a month-to-month deal, it gives us the most flexibility in whatever we do moving forward.”

That deal, combined with what Robinson calls “Business 101” and the city’s existing enterprise departments, form his case for keeping the electric status quo.

“One of the biggest principles of business is to ‘buy low and sell high,’ he said. “If were to buy a franchise and try to build a franchise -- at this point – if you think FP&L is charging you a lot for power, the city of Pensacola can probably charge you more – we’ll find a way we can do that. I don’t think that would be productive for any of our citizens.”

One the same page as the mayor of the city utility hymnal is City Councilwoman Sherri Myers.

“The city of Pensacola borrowing, hundreds of millions of dollars, probably, to municipalize electric, we would only be purchasing part of the infrastructure, anyway,” Myers said. “Because AT&T owns a lot of the infrastructure also.”

Myers does support Mayor Robison, if he chooses, to continue negotiating a franchise fee with Florida Power and Light. She agrees with Robinson that raising the franchise fee to ten percent has been a sticking point in talks.

“Ten percent would mean that we would have the highest franchise fee in the state of Florida,” said Myers. “We’re already paying the highest in the state of Florida, and it’s passed on to the consumer. I do think that there’s some opportunities to negotiate.”

In the meantime, the city will spend $30,000 on a feasibility study before starting such a utility, according to the Florida Municipal Electric Association.