Jacksonville Civic Council rolls out next steps in its JEA valuation inquiry

JEA board to be reshuffled, again.

As Jacksonville wrestles with the question of whether or not to privatize its public utility, the influential Jacksonville Civic Council outlined its plan to weigh in Friday.

“After meeting with several consultants and public utility experts, the committee has developed – and our Executive Committee has approved — a framework for proceeding with the analysis,” wrote Michael Ward and Bobby Stein, co-chairs of that ten-person panel.

“In the weeks ahead, we will be in touch with you to schedule a meeting to present the analytic framework in person. We will also request a time for Mr. Ward to present the framework to the City Council Special Committee on the Potential Sale of JEA and to answer any questions,” the letter to the City Council continued.

Mayor Lenny Curry likewise will get a meeting with Ward.

The committee will explore the question of JEA’s “optimal use and structure,” noting that selling the utility or keeping it is “not a binary question.”

The committee will also explore JEA contributions to the city (including but not limited to the utility’s $116.1 million annual contribution), as well as what would change if JEA were sold.

“The utility would behave like a for-profit company that is owned by an even larger for-profit company. It would be a responsible corporate citizen, and it probably would be effectively run. There are likely to be changes to several factors in the event of a sale, including: rates, customer service, response time, economic investment and
contributions to the City,” the JCC posits.

As well, the JCC panel will mull “other alternatives,” including “[managing the] balance sheet more efficiently to extract ~$1B of capital, hybrid ownership models, service agreements, etc.”

It is unknown why the extraction of $1 billion was chosen as a benchmark.

The panel will also evaluate the effectiveness of JEA’s management, potential changes to the industry (advocates of a sale note that electricity delivery will change in the coming years), and criteria for a sale (“contingent liability analysis, environmental liability, economic development impacts, inclusion of a buy-back clause, rate freezes, and
employee retention).

One thing the committee will not do: make recommendations for the use of sale proceeds, which is “outside the scope” of the study.