by Joe Wilhelm Jr.
Staff Writer
After battling through one of the tougher budget sessions during his time in office, Mayor John Peyton is looking for additional revenue streams for the City and one suggestion may be an increase to the JEA franchise fee.
The mayor discussed this option with the Charter Revision Commission at its Nov. 19 meeting as the Commission prepares to write a report to the City Council to recommend changes to the City’s Charter, the rules by which Jacksonville is governed. The fee change could be addressed by a Charter amendment. Following up to the mayor’s presentation, the Commission invited representatives of the JEA to appear before the Commission and provide some information on its financial status and thoughts on a franchise fee increase at a Dec. 3 meeting.
“If the franchise fee were to be increased by that, currently, unutilized 3 percent, for a charter school use or any other use we may propose, what affect would that have on JEA’s rates?” said Wyman Duggan, chair of the Charter Revision Commission. “Would that put pressure on JEA to increase its rates?”
The franchise fee was implemented in April 2008 and collects 3 percent from base electric, fuel, water and sewer rate revenues. The mayor, along with two-thirds of the City Council may increase the franchise fee up to 6 percent.
Jim Dickenson, managing director/CEO for JEA, explained that the increase wouldn’t affect rates, but customers would see an increase in their bills because the franchise fee is assessed separate from what customers pay for electric service.
“What we charge our average residential customer right now is about $110 per 1,000 kilowatt hours,” said Dickenson. “When we set our rate it does not have the franchise fee or the public service tax in it.”
An increase in the fee may not affect the JEA rates, but Dickenson recognized it would increase the frequency of calls to customer service.
“The customer writing the check to JEA, if you raise the rate 3 percent, I guarantee we’ll get the calls,” said Dickenson.
JEA contributed just over $215 million, about 22 percent, to the City’s 2010 fiscal budget. This contribution includes the JEA’s $99.2 million contribution to the City plus the $79 million in public service tax and $37 million in franchise fees it collects for the City.
The JEA provides electric, water and sewer services to customers in Jacksonville. Electricity is provided to over 360,000 customers, more than 240,000 customers for water services and 186,000 sewer customers.
“Does JEA have the capacity to transfer more funds to the City? Do we have some money laying around?” said Dickenson. “The short answer to that is no. If I had money laying around that I could do something with I would have returned it to our customers.”
356-2466