JACKSONVILLE, Fla. – In his first major move since taking charge of JEA, interim Chief Executive Officer Paul McElroy placed the majority of the utility’s leadership team on paid administrative leave last month.
On Monday, JEA confirmed that nine executives were terminated without cause, according to JEA. The executives will receive 20 weeks of compensation and health benefits, JEA said.
“JEA is focused on moving forward with building back the trust of the community, its customers and employees,” JEA said.
McElroy first notified eight executives of the move last month, saying that employees, the City Council and community no longer had confidence in their leadership, a utility spokesperson told the News4Jax I-TEAM.
“Individually or collectively, real or perceived, you have been complicit or implicitly involved with or simply a direct beneficiary of the (Invitation to Negotiate) or Performance Unit Plan,” McElroy said in part. “Over the last number of weeks I have reviewed testimony and spoke with many people about the ITN and the Performance Unit Plan, nothing I’ve read or heard clarifies your role, real or perceived in a positive light.”
“I have concluded you as individuals and as a group have lost the confidence of management, employees, City Council, the media and the community.”
[SPECIAL SECTION: Tracking the JEA saga]
The executives that were terminated include: Caren Anders, VP/GM Energy Systems; Deryle Calhoun, VP/GM Water/Wastewater Systems; Shawn Eads, Chief Information Officer; Jon Kendrick, VP/Chief Human Resource Officer; John McCarthy, VP/Chief Supply Chain Officer; Steve McInall, VP/Chief Energy & Water/Wastewater Planning Officer; Paul Steinbrecher, VP/Chief Environmental Officer; and Kerri Stewart, VP/Chief Customer Officer. The move follows last month’s suspension of Chief Administrative Officer Herschel Vinyard. He was also terminated without cause, JEA confirmed Monday.
“The termination of the Senior Leadership team appears to be part of an effort by JEA to regain public confidence and have a fresh start. Some of the leadership team may very well have done the best they could under difficult circumstances and done nothing wrong,” said News4Jax Political Analyst Rick Mullaney. “The termination without cause supports this conclusion. The public arena, however, often requires change when public confidence is lost.”
The shakeup comes as JEA faces intense scrutiny from the Department of Justice and a City Council special committee. The Justice Department does not typically comment on active investigations, but it has asked the Council panel not to interview key witnesses in the scuttled plan to put JEA up for sale.
City Councilman Rory Diamond, who is leading the council committee’s investigation, said he was surprised by some of the names listed. He speculated that McElroy, a former JEA CEO who was tapped to get the utility back on the right track, is taking steps to prepare the utility for his permanent replacement.
“You have employees there who have worked for JEA essentially for their entire lifetime, and some very good professionals there,” Diamond said. “This list is the best indication yet that Paul McElroy is essentially doing a clean sweep and starting JEA all over again.”
The investigations stem from the ITN, or Invitation to Negotiate, a plan to court potential suitors interested in buying or running all or part of the city-owned utility. JEA’s Board of Directors canceled those plans last year in response to public backlash and fired then-CEO Aaron Zahn, who is now being sued by the city of Jacksonville. The ousted CEO of JEA fired back earlier this month in response to the lawsuit filed against him by the city-owned utility and is fighting for a private meditator to decide contract dispute.
Also at issue is the Performance Unit Plan, or PUP, which basically would have been a stock purchase plan that could have financially benefited executives and others in the event that JEA was sold.
For the next 20 weeks, these executives will continue to collect big paychecks. Records obtained by the I-TEAM show their salaries, including Vinyard’s, range from $184,000 to $350,000 a year. In other words, they’re making $88-$168 an hour to sit on the sidelines.
|Employee Name||Title||Hourly Rate||Base Salary|
|Caren Anders||VP/GM Energy||$141.8||$295,000|
|Deryle Calhoun||VP/GM Water/Wastewater||$105.8||$220,000|
|Shawn Eads||VP/Chief Information Officer||$132.2||$275,000|
|Jon Kendrick||Chief Human Resource Officer||$98.6||$205,000|
|John McCarthy||Chief Supply Chain Officer||$88.7||$184,000|
|Steve McInall||VP/Chief Energy/Water Planning||$96.2||$200,000|
|Paul Steinbrecher||Chief Environmental Services Officer||$88.7||$184,000|
|Kerri Stewart||VP/Chief Customer Officer||$113.3||$235,500|
|Herschel Vinyard||Chief Administrative Officer||$168.3||$350,000|
“The thing that bothers me the most about what we have learned in the committee is just how consistent and all the effort that Aaron Zahn went into in getting these ridiculous bonuses. It’s without question to me the biggest scandal in the history of Jacksonville as far as money goes. It could’ve been over $1 billion — that’s outrageous," Diamond said.
The fallout from the controversy surrounding the ITN and PUP has been wide-ranging.
Besides Zahn, it led to the resignation of former Chief Legal Officer Lynne Rhode and the dismissal of former CFO Ryan Wannemacher. In February, JEA’s board of directors resigned. In April, the board’s replacements voted unanimously to remove interim CEO Melissa Dykes, a longtime executive who served as chief operating officer during Zahn’s stint running JEA. More recently, Vinyard was placed on leave last month.
City Councilman Matt Carlucci said he doesn’t think everyone who’s been suspended deserves the blame.
“I just can’t help but feel bad for some people who were trying to hold onto their jobs,” Carlucci told News4Jax. “They had three more years before retirement and then this comes along — Aaron Zahn comes along and fouls up the whole thing.”
The list of determinations does not include Chief Legal Counsel Jody Brooks, interim Chief Government Affairs Officer Kurtis Wilson and interim Chief Financial Officer Joseph Orfano, who will fill that role until his replacement, Brian Roche, begins taking over those duties on June 22. At that point, Orfano will move to the utility’s treasury team.
As part of the same move, seven individuals will join the utility’s senior leadership team on a temporary basis:
- Stephen Datz, Interim Chief Information Officer
- Bruce Dugan, Interim Chief Communication Officer
- Ricky Erixton, Interim General Manager, Electric Systems
- Angie Hiers, Interim Chief Human Resource Officer
- Alan McElroy (no relation), Interim Chief Supply Chain Officer
- Hai Vu, Interim General Manager, Water/Wastewater Systems
- Wayne Young, Chief Environmental Officer
McElroy announced last month that Hiers, along with two others, would be temporary additions to his leadership staff. Other additions include Vickie Cavey, a longtime JEA executive who spearheaded the utility’s strategic planning and development from 2013 until she retired in 2017, and Gerri Boyce, another longtime employee who served as JEA’s spokesperson until her retirement in 2018.