Agreement reached with JEA: Contribution, Charter changes, and Joint Efforts

This week, Council will likely pass amendments to the City Charter regarding the JEA contribution that will be in effect for the next 5 year period, as well as approve an Interagency Agreement that obligates JEA to work with the City on TMDL credits, water and sewer expansion, and other similar initiatives. Unlike the so-called Carlucci/Appelby proposal floated about a year ago, this proposal does not reduce the JEA contribution to the City each year but rather establishes a floor and a formula for a modest annual increase. The increase is much less than under the formula currently in effect but the floor provides the City budget stability. The new formula is designed to eliminate the need for a rate increase on the JEA side and provide the utility with the ability to pay down debt and maintain its credit rating.

In addition, the committee considering the bill and the relationship between the City and the utility spent many hours discussing TMDL (environmental compliance) credits, water and sewer expansion, and new business lines. JEA has agreed to transfer to the City without charge the total number of TMDL credits required by the City for the term of the 5 year agreement. This transfer frees up approximately 2.5 million dollars of annual stormwater fee revenue which was committed to be paid by the City to JEA annually for such credits. These funds can now be used for stormwater improvements as intended. Finally, JEA will make a one-time contribution of $15 million to the City to be used for septic tank phase out and sewer line extension. This contribution will be matched by the City over a period of several years. There is much more work to be done in refining the roles and responsibilities of the parties for infrastructure expansion, but the framework has been established in this agreement.

If you would like to read the legislation or agreement, the bill number is 2015-764 and it is the Substitute bill that is under consideration.

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