JEA is ours to keep

The push to sell the Jacksonville Electric Authority (JEA) created a heated discussion in our community that centered around the current and future value of our locally owned utility. While JEA’s Board officially voted to withdraw the invitation to negotiate (ITN) at an emergency meeting on Christmas Eve, there are several lessons to remember about the importance of having a public utility if there is a renewed effort to sell JEA by this or any future administration.

Every person in our great city should know the value that JEA represents to our citizens and ratepayers. A locally owned utility has many advantages that privately-owned utilities do not. The first of these advantages is the yearly contribution that JEA contributes to the city’s general fund. For the current fiscal year, the JEA contribution totals $133 million, which is up over 14% from last year. In addition, Ernst and Young recently announced that JEA had a stellar 2019 – bottom line profit increased 56%, and they called the utility’s financial performance “outstanding and strengthening.”

Beyond that, JEA is responsible to the citizens of Jacksonville, ratepayers, and the employees, not outside shareholders, investment banks, and other investment vehicles. As a hometown insurance agent, I have responded to hundreds of hurricane and tropical storm claims. I know the value of quick response times and local, on-the-ground responsibility. The value of first responders who know their way around Jacksonville is unmeasurable when it comes to restoring service to our community. As unsung first responder heroes, our JEA employees take pride in the work they perform for their neighbors and the community at large. I have seen them quickly and tirelessly respond to situations that are hazardous, in order to make neighborhoods safe and restore power to every home.

I have read too many accounts about private utility companies that did not respond to emergencies in a timely fashion. I am relieved that Jacksonville will not be in that position. 

Important benefits of municipally owned utilities such as JEA include the ability to recover a large portion of the cost of infrastructure damages caused during disaster situations such as hurricanes through FEMA. The City projects FEMA will reimburse JEA for over $115 million as a result of infrastructure damages inflicted by Hurricanes Matthew and Irma. Additionally, municipally owned utilities can borrow money through government bonds at lower interest rates, passing substantial savings to ratepayers.

In both these cases, private utilities must recover the cost of damages and higher interest rates from their ratepayers. 

JEA has a record of community building. As an example, when the Navy closed the base at Cecil Field, JEA invested approximately $53 million to upgrade water and sewer lines. This investment helped turn the former base into the Cecil Commerce Center that has brought new business to Jacksonville and is creating new jobs. JEA helped turn an economically deprived area into an economic engine that has expanded the tax base and helped hold the line on increasing homeowner taxes. JEA also has:

  • Invested $30 million into remediation of failing septic tanks in our community. 
  • Purchased preservation land as a part of the Better Jacksonville Plan, which has helped to mitigate flooding from storms and preserve the natural beauty of the Timucuan preserve. 
  • Helped Little League baseball associations by erecting concrete light poles that allow for a Little League night games.  

JEA rates are set right here in Jacksonville, where accountability is subject to local control, and this keeps ratepayers closer to the people who set rates. Ratepayers of privately-owned utilities are separated from those who set rates by out-of-town management, stockholders, and the Florida State Public Service Commission.

 As our city moves forward with our locally owned utility, we must also acknowledge that the headwinds JEA faces are real and need serious discussion. JEA needs to enter other markets because people are using less electricity, which means income generated per business or household is declining. This is a challenge, but it can be overcome by expanding JEA into new markets. As the eighth largest municipal utility in the U.S., the opportunity is available. It merely takes leadership that is willing to reimagine the possibilities. New markets could include increasing JEA’s chilled water sales, entering into natural gas, and becoming involved in the nearly limitless fiber optics market. To enter these markets is not a daunting task. In some cases, it will take amending the City charter or seeking a legislative change. For the most part, what it takes is capital, which JEA has, and a new innovative, highly qualified CEO with a can-do attitude and a board that is open to new and innovative ideas. 

The future success of JEA is tied to the success of another vital community-owned asset, our public schools. We must improve our outdated school facilities. By doing so, we can retain people who are moving out or reject coming to Duval County because they recognize our schools are obsolete and must be brought into the 21st century. Because of the condition of our schools, people fail to recognize Duval County Public Schools are only three points below an “A” rated district. Improving our schools will retain families in JEA’s service area and create a demand for new homes built in the service area. Today 45% of the population in Saint Johns and Clay Counties are employed in Duval County. However, they choose to live in adjacent counties because they perceive the schools to be better there.

We need to pass a half-cent sales tax to replace and improve our old schools. Better schools in Duval County will retain and increase the number of families moving to Jacksonville. This, in turn, will increase JEA revenue. Everything ties together. 

While this sales process is thankfully now in the past, we should not forget public utilities are of such great value for their hometown. I can sum up my feelings with one short statement— local control is priceless.

I want to thank Mayor Curry for reversing his stance on this critical issue and commend the leaders and key factfinders during the attempted sale: Council Auditor Kyle Billy, whose team of professionals helped uncover the ridiculous JEA incentive plan that could have cost taxpayers hundreds of millions of dollars, and the staff of the Florida Times-Union, whose relentless search for the truth helped keep the public informed every step of the way along with our local television news teams. And I am grateful to The Resident Community News for giving me this forum to express my views. 

Above all, it is the people of Jacksonville who win the day. Though there will continue to be fallout, consequence, and even a potential investigation into what – or who – prompted this attempted sale, we can all breathe a sigh of relief knowing that JEA is ours – and ours to keep.

Matt Carlucci, San Marco
At-Large, Group 4 City Councilman

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