A.G. Gancarski
The question going into Tuesday: would the JEA Agreement finally be reached?
Most of the terms had been agreed to, piece by piece, during a year of meetings.
And there was cautious optimism, at least from the city side, that Tuesday would be the day.
“It looks like the finish line is in sight, unless somebody throws up a road block,” Committee Chair Bill Gulliford said.
The agenda, however, promised “continued discussion.”
And that promise was fulfilled before accord was reached.
The redlined draft of the 19 page interagency agreement between the utility and the city was provided.
Stricken: “JEA has a long history of making significant contributions to the public welfare….”
Added: “the city and JEA maintain a unique relationship.”
Those lines underscore the essential tension that exists, one where JEA asserts its independence, and the city sees the utility as a subsidiary.
Bond covenant issues were discussed. As were new revenue streams, such as solar and liquified natural gas.
At issue: should the city get a cut of those revenue streams during the course of the agreement?
JEA’s CEO Paul McElroy discussed “pledging the revenues” for such for a bond issue, something that Lori Boyer had questions about, regarding a need on JEA’s end to pledge the money for that line of new business.
Boyer wanted to avoid “some action that would be a ‘gotcha’ for us in 2021,” when it’s time to renew the agreement.
Boyer called attention to another issue; if federal or state laws changed, JEA wanted a potential change in the agreement to “mitigate the adverse impacts” of anything that might hamper JEA’s position.
That issue, and a corollary issue, of adjusting the rate structure if the city’s position is adversely affected, was stricken from documentation, rather than codifying reciprocity.
Basin Management Action Plan credits were another sticking point.
As this discussion was going on, Lenny Curry stopped in. Gulliford told him this was closer to the end than the beginning.
“You have the right board and the right team,” Curry said, before walking out again.
Another point of discussion: natural gas.
Matt Schellenberg noted that the large amount of natural gas JEA procures gives them a competitive advantage against private enterprise, due to volume discounts.
McElroy noted the “inherent inefficiency” of getting natural gas via a pipeline.
“Half the time, we’re paying for transportation,” and McElroy noted that brokering natural gas for the purposes of “economic development” for businesses is a good thing.
Another point of discussion: ad valorem taxes for non-traditional utility providers. And still another: right of way permitting.
And still another: sewer project approval, which could not “commence until … approved by the city.”
Gulliford had questions; Sam Mousa noted the city in this case is the director of public works.
The agreement, and the fine tuning, must strike balances between operational realities and assuring the markets that JEA is in a good place.
“It’s been a long and winding road,” said Council President Greg Anderson, “that speaks to… success on both sides.”
Anderson would like to have the bill introduced by “all the people who did the work,” and the Finance Committee substitute would incorporate the appropriate names as co-sponsors.
This bill will find its way to committees next week.
