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Power comes down to a vote

Belleair residents will vote Tuesday whether they want to start a utility separate from Progress Energy.

By LORRI HELFAND
Published November 6, 2005

BELLEAIR - Tuesday, voters will decide if their town will sever ties with Progress Energy and run its own electric company.

Folks on both sides of the issue say the referendum may be the most important vote facing Belleair in decades - and the most divisive.

"Unfortunately, it's been an emotional and contentious issue," Commissioner Bonnie Ruggles said at Thursday's town meeting on the subject.

Proponents say running the utility will guarantee revenue the town could use to repair roads, lower energy bills or bury electric wires.

"If you don't take the risk, you won't make the money," resident John Hail said.

Opponents say the venture could strap the town with a business it can't manage and leave Belleair in debt for years to come.

"If the bubble breaks, who's going to handle the hot potato?" resident Earl Fiene asked the commission.

There are currently 33 municipal utilities operating in the state. If residents vote in favor of the enterprise, Belleair would be the second city in Florida since 1943 to start its own municipal utility.

Winter Park, which had major reliability issues with Progress Energy for years, separated from the utility in June and then suffered more problems.

Belleair officials say their 2-square-mile town wouldn't have the same issues and would be easier to handle because of its smaller size. Some power professionals dispute that.

The town explored burying its poles and wires in the early 1990s. Florida Power, Progress Energy's predecessor, told officials it would cost millions to do so. Five years ago, Belleair took the utility to court to enforce terms of a 1971 service contract. Relations between Belleair and the utility have deteriorated since then.

Several other cities, including Casselberry, Longwood and Dunedin, have explored breaking ties with Progress Energy. Casselberry and Longwood renewed 30-year contracts with the company and Dunedin signed a 10-year contract in 2001.

A court-ordered arbitration panel ruled that Belleair could buy Progress Energy's distribution system at a cost of $8.5-million. If the referendum passes, Belleair plans to borrow up to $9.5-million for startup costs from the Florida Municipal Loan Program, managed by the Florida League of Cities.

Belleair officials say they will purchase power in bulk from Progress Energy and hire a contractor, Coastal Electric Maintenance & Construction of Tampa, to run the system, maintain it and respond to emergencies. Belleair's power system would be the first municipal utility that Coastal has run.

Lorri Helfand can be reached at 445-4155 or at lorri@sptimes.com

[Last modified November 6, 2005, 01:59:22]