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Jax Daily Record Tuesday, Jan. 12, 202108:59 AM EST

Rick Mullaney: Report on JEA could change city government

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“One of the most significant investigations conducted in the history of City Council,” says JU Public Policy Institute Director.
by: Max Marbut Associate Editor

The Report of the Special Investigatory Committee on JEA Matters likely will change how the city and its independent authorities do business, according to a public policy educator and former city general counsel.

Rick Mullaney

“It’s one of the most significant investigations conducted in the history of the City Council. It will be useful for future legislation and for other investigative agencies,” said Rick Mullaney, founding director of the Public Policy Institute at Jacksonville University.

The special committee was established to investigate the professional and political conduct, processes and actions on the part of elected and appointed officials surrounding the proposed privatization of Jacksonville publicly owned electric and water utility.

That included a bonus plan for JEA executives and employees that could have resulted in financial windfalls had the sale been approved.

The 132-page report, submitted by attorney Steve Busey of Smith Hulsey & Busey and the Council’s special counsel on JEA, details steps taken in the sale effort that began in 2017. 

The plan was squashed Dec. 24, 2019, when the board of directors convened an emergency meeting and voted unanimously to withdraw its offer to sell the utility, a week after canceling the bonus program.

Subsequently, the board voted to terminate Aaron Zahn, who was appointed to the board by Curry after privatization was proposed, then became JEA’s CEO during the solicitation of potential buyers. The board also voted to fire the members of the senior leadership team involved in the sale effort and development of the bonus plan. 

The committee looked at the involvement of executives, the board, the board’s city and private attorneys, JEA’s senior leadership team and myriad consultants retained by the utility to advise them on the sale, as well as Mayor Lenny Curry and his advisers.

“The report chronologically and systematically lays out the facts and takes you to inescapable conclusions,” Mullaney said.

The report concludes there’s the need to enhance and better enforce the Jacksonville Ethics Code and improve compliance with the state Public Records Act and Florida’s Sunshine Law, “which help ensure employees of the city and its independent authorities honor their fiduciary duties of trust, honesty and commercial reasonableness.”

Mullaney expects there will be legislation adopted to achieve those objectives, including amendments to the city charter to clarify employment and procurement procedures at JEA and the city’s other independent authorities.

He predicts a new management environment at JEA with the appointment of new board members and the hiring in November of CEO Jay Stowe.

“JEA is turning the page. There’s new leadership and a new direction,” Mullaney said.

As for possible criminal charges related to the proposed sale of JEA that might be based on violation of public records and government transparency laws, State Attorney for the 4th Judicial Circuit Melissa Nelson said in January 2020 that she turned over her investigation to federal officials.

A subpoena from the U.S. District Court, Middle District of Florida, grand jury was served April 21 to JEA for documents related to the failed push to privatize the utility and the hiring of Zahn.

Federal prosecutors also subpoenaed communications and documents from lobbyists, JEA’s contracted legal and financial firms and consultants involved in the utility’s invitation to negotiate and the proposed employee bonus plan.

“The ball is in the U.S. Attorney’s court,” Mullaney said. 

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