Alarm bells may not be ringing furiously just yet, but Tallahassee city officials and others are monitoring talk in the Florida Legislature about giving the state more control over municipal-owned electric utilities.
Discussion popped up Tuesday in the House Energy, Communications & Cybersecurity Subcommittee about possible legislation that could give more oversight of city electric utilities to the Public Service Commission. The PSC regulates investor-owned utilities but not municipally owned ones.
Amy Zubaly, executive director of the Florida Municipal Electric Association, said Wednesday it would be hard to comment given the lack of any bill or language it might contain. But she expressed no enthusiasm for a change in the way the state’s nearly three dozen city-owned electric utilities operate.
“I would need to see words on paper before I could comment on anything,” she said. “But no, we are certainly not looking for any sort of legislative action on the way we govern already to our customers.”
Rep. Mike Caruso, R-Delray Beach, said there may be a need for legislation giving the PSC authority over city electric rates to keep them “as low as possible,” the News Service of Florida reported. He expressed concern about city utilities “supplementing some other venture” through electric rates, though he didn’t elaborate.
Rep. Chuck Clemons, R-Newberry, raised the issue of electric customers who live outside city limits and can’t vote in city elections, a situation he called “taxation without representation.”
That criticism has come up before in Tallahassee, where about 17% of city electric customers live in unincorporated Leon County. In 2021, Leon County Commissioner Bill Proctor wrote city commissioners complaining about south-side precincts where city customers can’t vote in city elections.
“Taxation without representation was and is wrong,” Proctor wrote, adding, “you refuse to let them vote although you take their utility monies of which 30% is utilized by you to undergird general city government operations.”
Tallahassee’s is the fourth-largest of the state’s 30-plus municipal-owned electric utilities, serving roughly 127,000 customers, and the 27th largest in the United States. About 22,000 customers reside outside city limits. Talquin Electric serves another 26,000 or so customers in unincorporated Leon County.
Each year, the city’s electric utility generates millions in proceeds for general government operations. Last year, the city transferred $32.3 million from the Electric Utility to the general fund, which helps cover the cost of city services and programs.
Zubaly said such transfers are common among municipal electric utilities in lieu of property taxes they would pay if they weren’t government-owned and tax-exempt. She also said city customers who reside outside city boundaries still have representation through citizen utility boards and commissioners themselves.
“From our perspective, they’re our customers, and we’re going to treat them all (the same),” she said. “And those customers that are outside city limits still use the city services. They’re using parks, they’re using roads ... that are provided to the residents whether they’re inside or outside the city.”
As of November, FMEA ranked Tallahassee as having the sixth-lowest residential bill for 1,200 killowatt hours and the eighth-lowest for 1,000 kilowatt hours among 37 city- and investor-owned electric utilities in Florida. FMEA listed Tallahassee among three electric utilities with the lowest commercial bills.
Several other cities in North Florida operate their own electric utilities, including Quincy, Havana, Chattahoochee and Blountstown.
The House subcommittee meeting did not go unnoticed by City Commissioner Jeremy Matlow or his aide, Ryan Ray, the newly minted chairman of the Leon County Democratic Executive Committee.
Ray said the city’s electric utility is “a target for acquisition” by big investor-owned utilities with sway over Florida regulators. Matlow said that the city’s ownership of its own electric utility means decisions are made locally.
“We know there are financial and political interests that want to take that away from us, and this is just another attempt at muddying the waters,” Matlow said. “I don’t think it will work — there is a reason Tallahassee gets named one of the No. 1 public utilities in the nation.”
Back story:FPL, Tallahassee mayor meeting: A 'ginned up' political attack or public utility threat?
Contact Jeff Burlew at email@example.com or follow @JeffBurlew on Twitter.
This article originally appeared on Tallahassee Democrat: Tallahassee monitoring talk in Legislature about more state oversight of city-run electric utilities