The utility says the program will be amended next year.
Ending a 12-month investigation, the city Office of Inspector General issued its final report Wednesday on operations related to JEA’s employee-owned and managed fitness facilities.
The report concludes that the 10 gyms at JEA sites are operated inconsistently in terms of oversight, financial accountability and management.
In a letter in response to the findings, JEA Chief Compliance Office Ted Hobson states that by March 31, the publicly owned utility will determine whether it’s in JEA’s best interest for the facilities to remain in operation and provide a written report to the inspector general.
The investigation began based on suspicions of improper management of the facilities reported to the inspector general by JEA employees.
Initially, managers at two of the gyms were found to have misappropriated for personal use membership dues collected from employees totaling more than $20,000.
Those findings prompted further investigation of JEA’s fitness facility operations.
Since 1991, when the employee gym program was established, JEA has provided free space for gyms at some of its generating sites and other locations, including building maintenance, water and electricity. Employees at each site manage the gyms on a voluntary basis during their official work hours.
New and replacement fitness equipment, as well as operating costs such as towels and cleaning supplies, are paid for by $5 biweekly membership dues. The dues are direct-deposited into accounts individually maintained for each facility’s gym.
The inspector general’s office audited the bank accounts and other financial records related to the gym program and determined that a total of $204,275 was deposited between Jan. 1, 2015, and June 30.
The report concludes that the gyms are operated without adequate accounting controls. For example, only one or two members at each location are involved in the financial activities and authorized to make deposits and withdrawals.
Some of the gym managers did not retain adequate financial records or reconcile bank statements. The review found some cases of incomplete financial records, such as missing bank statements, missing receipts for purchases and missing records related to donations or sponsorships.
The report concludes that the managers primarily used dues collected to purchase gym equipment, accessories and supplies to maintain the equipment.
However, inconsistencies were found among the gyms in the types of items purchased. Dues deposited to some gyms were used to purchase nutritional supplements that were consumed by some, but not all members; televisions and cable television service; entertainment systems; off-site personal trainer instruction for some members, but not all; and donations to food drives and athletic organizations that were not approved by all gym members.
The report recognizes that the gyms “are a benefit to employees,” but recommends corrective action “to ensure oversight, accountability and consistency” in gym operations:
• Determine whether the gyms should continue to operate independently of JEA without contractual agreement or release of liability for use of JEA facilities.
• If the facilities are to remain open, establish appropriate written procedures to ensure uniformity at all facilities regarding financial records, purchasing and duties.
• If the gyms should be managed by JEA employees, identify and incorporate duties assumed by the employees into their formal job specifications and annual evaluations.
• Conduct an inspection of all JEA facilities to determine if any gym equipment may be in use by JEA or contracted employees in locations not already identified in the review.
Hobson said JEA auditors and security staff have visited all known gym locations. Management will coordinate with the lead supervisors of each site to do a “sweep” inventory of all fitness equipment on the premises.
The items will be listed, centrally stored and reported to the inspector general by April 30.
He also said in the letter that JEA will develop the “optimal strategy” for an employee fitness-wellness program.
“Several options are being considered, one of which is continuation of the employee-operated gyms. Having been some 25+ years in existence, there are numerous legal and logistical issues to address,” Hobson wrote.