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Jax Daily Record Thursday, Feb. 14, 201904:40 AM EST

The Cawton Report: JEA, city extend their contribution deal

Agreement now runs through 2023 and will add another $243.6 million to the city’s general fund.
by: David Cawton Associate Editor

An agreement between the city of Jacksonville and its electric, water and wastewater utility company was extended Tuesday night, securing another $243.6 million in contributions to the city’s general fund through 2023.

City Council members unanimously passed legislation extending an existing contribution agreement between the city and JEA that provides contributions to the general fund in lieu of property taxes.

JEA contributes about $120 million each year to the city’s $1.2 billion general fund.

The agreement extends JEA’s commitment through the 2022-23 fiscal year and extends a provision that requires JEA to transfer about $8.5 million each year in Water Quality Credits to the city for another 10 years, through 2033.

JEA also will contribute $15,155,000 toward phasing out septic tanks in some of the city’s underserved neighborhoods and for river monitoring equipment. The utility has provided $30 million to remove septic tanks since 2016.

After the vote, JEA CEO and Managing Director Aaron Zahn said the extension is part of the utility’s strategic plan over the next five years.

“There is nothing like financial stability,” Zahn said.

He said the agreement, and other efforts, will help JEA as it tries to address lackluster electricity sales over the past decade.

“That’s on top of paying off about $1 billion in debt, which will increase our free cash flow,” he said.

The agreement also means JEA will continue to contribute 30.34 metric tons of water quality credits each year, plus an additional 13.6 metric tons in perpetuity. According to JEA, those credits are worth about $8.5 million each year.

“That can be used to go toward education and public safety and police and fire as opposed to water credits because JEA is creating those through its natural business,” Zahn said.

The agreement comes one year after JEA presented a financial evaluation to council members when conversations over possibly privatizing the utility company dominated City Hall.

Zahn was a board member at the time and said he did not think JEA should be having the conversation in the first place.

“The first question we needed to ask was what is the best business model to serve the customers,” he said Tuesday.

“We have now gone through a nine-month period of strategic alignment, have established a strategic framework and values for the company, and now we’re working on culture.”

Zahn said the company is working on publishing a financial forecast that covers the next 10 years, “that shows people what the company looks like if we do nothing, and what is possible.”

JEA also is considering three proposals to relocate its Downcorporate headquarters.

Citing the company’s procurement code, Zahn said he could not speak about the proposals.

The JEA board of directors is expected to make a final decision in early April.

Jacksonville City Council candidates gathered at Southside Baptist Church in San Marco on Monday as they seek one of five at-large seats in the March 19 election.

Forum features at-large candidates for City Council

Running for an at-large seat on Jacksonville’s City Council is no easy task when you look at a map of Duval County.

For the 16 candidates filed to run in one of the five at-large races, the prospect of covering most of Duval County’s 841 square miles can be daunting.

There are 19 seats on Jacksonville’s legislative body with 14 members representing individual districts. The remaining five represent the entire city “at-large.”

The district boundaries are drawn according to population.

The election is March 19. If no candidate earns more than 50 percent of the votes, plus one, the top two will compete in a May 14 runoff election.  The council year starts July 1.

“It’s a challenge for sure,” said Matt Carlucci, one of three candidates seeking to succeed Greg Anderson in At-Large Group 4.

“I had to be in Baldwin yesterday, I have to be at Beaches today and then on the Northside tomorrow,” Carlucci said.

Carlucci appeared Monday night with a dozen candidates, including his direct challengers and fellow Republicans Harold McCart and Don Redman, at the Southside Baptist Church in San Marco.

Carlucci and Redman served on council in the past, holding district seats. Carlucci also previously served At-Large Group 4.

He said one of the biggest differences between a district and at-large race is how campaign funds are prioritized.

“Part of that is me selling myself, which I think I’m doing,” he said, adding that the campaign has “raised a lot of money, but it’s never really enough.”

“You’ve got to be everywhere all at once,” Carlucci said. “But that’s what that seat requires.”

The two-hour forum focused on drainage and resiliency issues, maintaining San Marco’s historic charm, public safety and government priorities.

At-Large Group 1 candidates included Democrat Lisa King and Republican Terrance Freeman, who appeared along with no party affiliate candidate Connell Crooms.

Democrat Darren Mason and Republican Ron Salem, running in At-Large Group 2, also attended.

The At-Large Group 3 incumbent, Democrat Tommy Hazouri, was present along with his Republican challenger, Greg Rachal.

Democrat Chad McIntyre and no party affiliate candidate Niki Brunson attended along with Republican incumbent for At-Large Group 5, Sam Newby.

Brunson, a member of the Jacksonville TRUE Commission, said running the citywide race forced her to step out of her East Jacksonville neighborhood to connect with people she may not have had she run in District 7.

“We’re all one big neighborhood and the challenges we face in my part of the city aren’t that different from those in San Marco,” Brunson said.

“Because I’ve lived in the urban core my whole life, I understand the issues that some of these neighborhoods are just now seeing as priorities,” she said.

Brunson acknowledged running a citywide race is an expensive exercise given the size of Duval County.

“This just means I have to work harder,” Brunson said.

Project Danville is approved

City Council members approved legislation tied to an economic development agreement that provides $261,000 in city- and state-backed financial incentives to an unidentified international distribution company using the code name Project Danville.

Danville proposes to invest $50 million into a Jacksonville facility that would employ 87 people by year-end 2022. Those positions are required to pay an average annual wage of $52,540, plus benefits.

According to the legislation, Resolution 2019-37, Danville received a $261,000 Qualified Target Industry Tax Refund, of which the city is responsible for $52,200. The state picks up the rest. The grant is worth $3,000 per new job.

Hart Bridge project planning begins

The ramps connected to the Hart Bridge Expressway leading into Downtown Jacksonville won’t come down until 2020, but work is starting.

The city seeks a minor modification from the St. Johns River Water Management District, a necessary approval for the project to proceed.

According to the Feb. 11 application, the project comprises demolishing a three-quarter-mile stretch of the existing elevated ramps between A. Philip Randolph Boulevard to east of Festival Park Avenue; building new eastbound and westbound ramp connections to Bay Street; and widening, reconstructing and resurfacing portions of Bay Street and Gator Bowl Boulevard.

The city recently secured a $12.5 million federal grant to help pay for the estimated $38 million project.

Facade grants getting a boost

The Office of Economic Development received $200,000 to continue its Facade Renovation Grant program in 2019.

City Council members approved ordinance 2019-21 at their meeting Tuesday night.

The bill appropriates money from the Countywide Economic Development II fund to provide grants to businesses investing in economically distressed areas of Jacksonville.

The money is an incentive for small businesses to improve the exterior of their properties.

The city provides 2-to-1 matching funds for improvements like painting; cleaning; installing doors, windows, awnings or signage; and completing other exterior renovations.

Since 2015, the city has approved $183,915 worth of grant money to 30 businesses. The grants range from $1,980 to $10,000.

The grant money is used to reimburse businesses after the renovations are completed and documented.

To date, only $5,000 has been paid out.

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