LCEC – Lee County Electric Cooperative

Cape Coral Franchise Ordinance Unanimously Approved

The journey to a renewed franchise agreement between LCEC and the City of Cape Coral has been a long and costly one beginning in 2015. A new agreement was unanimously approved tonight at the Cape Coral City Council meeting.

The Cape Coral City Council designated Mayor Coviello to lead negotiations on behalf of the City just prior to their summer break. The progress that he and LCEC CEO, Dennie Hamilton made in a very short time is a testament to what can be accomplished through collaboration and good faith.

With the common goal of executing a franchise agreement focused on the interests of both parties, the LCEC/Lee County franchise agreement was used as a base. Revisions to the term and franchise fee structure were agreed upon and the proposed agreement was finalized.

The LCEC Board of Trustees, at its September Board meeting last week, unanimously approved the acceptance of the franchise ordinance as it was negotiated and introduced to Cape Coral City Council on September 17 and approved this evening.

“I would like to express both my personal and the LCEC Board’s appreciation to the entire Council for unanimously designating the Mayor to lead the negotiations, and to Stuart Diamond, Joe Mazurkiewicz and Brian Rist for their efforts along the way to set the stage for the negotiations between Mayor Coviello and me,” Hamilton stated prior to the Council vote. “I would especially like to recognize and thank Mayor Coviello for his professional, well-reasoned, balanced and honest approach that allowed us to swiftly reach agreement without conflict,” Hamilton said during public comments.

Agreement Terms Highlights:
1. LCEC collects and pays franchise fees to the City of Cape Coral in exchange for the right and privilege to construct, operate, and maintain electric facilities in roads, streets, alleys, bridges, easements, rights-of-way and other public places with the City of Cape Coral.
2. The franchise fee will remain 3% of electric revenues for the first five years of the agreement. The fee can increase to 4.5% in the sixth year, and a maximum of 6% in the 10th year for the remainder of the agreement. If any other municipality receives a fee greater than 6%, the City of Cape Coral has the right to increase the fee if the benefits of the agreement match. The City can reduce the fee at any time during the agreement.
3. A 20 year agreement with an automatic 10-year extension unless either party provides written notification of intent to amend or terminate the agreement.
4. LCEC will continue to offer customer with qualified renewable energy systems an opportunity to sell excess energy back to LCEC. If the City has interest in exploring opportunities to participate in renewable energy projects or new technology, LCEC will engage in dialogue with the City and other parties as appropriate to determine the feasibility of new technologies.
5. The City of Cape Coral agrees not to distribute or sell electricity to LCEC customers and will not purchase electricity from a third party UNLESS PERMITTED BY LAW (such as in the case of electric deregulation). If the laws in Florida change resulting in deregulation of the electric utility industry and distribution is no longer determined by service territory, LCEC has 90 days to evaluate and match the terms of any third party and continue selling to the City of Cape Coral.