The City of Bushnell has been a municipal electric utility provider since 1919, for nearly 100 years. In 1981, the City of Bushnell and Sumter Electric Cooperative, Inc. (now known as SECO Energy), entered into an Electric Service Franchise Agreement for a 30 year term. This agreement allowed SECO Energy to provide electric services to specific areas inside the city limits. The agreement included a purchase option clause that upon expiration of the 30 year term, the City could consider purchasing the SECO Energy electric plant and facilities inside the city limits that serve those Bushnell customers. Since the expiration of the agreement, the City has attempted to negotiate a settlement with SECO but has been unsuccessful. The terms of the Franchise Agreement outlined a formal process called Arbitration, where an arbitration panel of judges could determine the purchase price the City would pay for the system based on facts and evidence.
The arbitration hearing was held at the Sumter County Courthouse in the historic courtroom during the week of February 20-24th. Three arbitrators heard the considerations from both SECO and the City on the purchase option valuation for the service territory that SECO currently serves inside the city limits.
The City has been informed of the arbitrator’s final decision. Based upon the totality of the evidence presented to the arbitrators, the amount of the final award was very close to what the City’s own feasibility study indicated - approx. $5.1 million dollars. Remember, with this expense to purchase, there is offsetting revenue that comes from the selling of the new electric load. Now the City will be able to do a firm cost vs. benefit analysis to see if exercising the purchase option is a good decision for the City and customers. The City feels this is a very important decision and affects the future of the Bushnell Electric System. A larger customer base means more electric revenue to help offset operating costs, thereby spreading those costs out to more customers and possibly resulting in lower rates. It would be the City’s priority to provide the same great reliability to new customers, as our current customers enjoy. The Bushnell City Council will review all the information, carefully examining this purchase option and making a decision for the future of Bushnell in a specially called meeting, date to be determined.
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Download the attachment below for Final Arbitration Award Information.
If you have questions regarding this information, contact Susan Noell or Bruce Hickle at 352-793-2591.
The arbitration hearing was held at the Sumter County Courthouse in the historic courtroom during the week of February 20-24th. Three arbitrators heard the considerations from both SECO and the City on the purchase option valuation for the service territory that SECO currently serves inside the city limits. It will take some time for the arbitrators to go over all the information, and determine a fair market value. Once this occurs, the City will then be able to do a firm cost vs. benefit analysis to see if exercising the purchase option is a good decision for the City. The findings and subsequent decision will be discussed with Bushnell City Council in a public meeting.
To stay informed, visit the City’s website to view the upcoming agendas or sign up for automatic emails to alert you when the agenda is published before a meeting. Typically, the agendas are available one week before the public meeting. If you have questions regarding this information, contact Susan Noell or Bruce Hickle at 352-793-2591.
The City of Bushnell and SECO will begin Arbitration proceedings on Monday, February 20th, at the Sumter County historic courthouse, beginning at 9am. This process will take several days, and will determine the actual purchase price for the electric system inside the city limits that SECO currently serves. The Bushnell City Council will discuss and decide on this decision at an upcoming City Council meeting. If you would like to receive an agenda, you can sign up online and one will be automatically sent to you via email when it is published. Stay informed – sign up today!
The Arbitration Hearing, to determine the purchase cost of the SECO electric system inside the city limits, has been postponed, due to an unavoidable delay, until a future date in early 2017. The purpose of the arbitration is to decide the appropriate value of the SECO electric system, inside the Bushnell City Limits only, so that the City can do a cost benefit analysis to determine if this purchase is a good decision for the future of Bushnell’s citizens.