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JEA Board shelves plan to court potential suitors

After spending $10M, JEA Board, at urging of mayor, pulls plug on talks of selling utility

JACKSONVILLE, Fla. – The JEA Board of Directors voted unanimously on Tuesday to end the process of finding potential suitors to purchase the city-owned utility.

The move came a day after Jacksonville Mayor Lenny Curry called on the board to pull the plug on the invitation to negotiate, or ITN, process, saying the community’s view of the process had been “eroded” because of missteps over the last few months.

After the mayor’s request, JEA Board Chair April Green called a special meeting for Tuesday morning to discuss the future of the process.

Ahead of the meeting, JEA posted a video on YouTube Monday night. In the video, interim CEO Melissa Dykes explained that the ITN process began “for the right reasons” in July, but she acknowledged the community’s trust had been lost.

“It has, unfortunately, become the single most divisive issue in our community,” Dykes said. "Our role as a community-owned utility should be to unite our community around essential services that touch all our lives, not to divide. So the process must now end for the right reasons.”

During the special meeting Tuesday, Dykes said the utility had spent $10 million on the ITN process, and one board member called it “complete government waste.” News4Jax has requested a full breakdown of how the $10 million was spent.

In addition to voting to end the ITN process, the Board agreed to immediately release all information about the sale that had been held back from the public during the process. After a legal review, the information will be released to the public, according to JEA.

“I think the board made the right decision today. Let’s end this thing. The public has lost complete confidence. The trust was broken,” City Councilman Rory Diamond said after the vote.

The ITN process recently came under fire from City Council members, with one saying the city could be left open to a lawsuit if the process continued on its current path.

“The public’s view of that (process) has been eroded due to missteps over the last few months," the mayor said Monday. “It’s time to stop. I hope everyone goes home and has a happy holiday, and that we come back and get JEA back to doing the business that it’s done for its ratepayers all along.”

Curry also called for all information surrounding the process to be made public as soon as possible.

“We’ve got too many big things we’ve got to do in this city,” Curry said. “We can’t be singularly focused, as a city, on one issue, and this has become a one-issue conversation in this town.”

City Council members said Monday that they are done discussing the potential sale of JEA but will continue to dig into how top city and JEA officials conducted themselves while courting businesses to buy the utility.

The city-owned utility has faced ongoing turmoil since the ITN process began, particularly when a city auditor discovered a controversial bonus program that could have netted top executives hundreds of millions of dollars if JEA was sold. That total was much more than the $3.4 million estimate provided to board members, according to the City Council auditor.

“Clearly, that raised a whole lot of flags. All of us, when we saw that, it appeared outrageous,” Curry said.

The controversy over the bonus plan, and how it was (or wasn’t) vetted, resulted last week in the removal of CEO Aaron Zahn and the departure of JEA’s top legal adviser.

The former CEO admitted he made an error in judgment proposing the controversial bonus plan. Zahn still stands to make up to $800,000 if he’s fired without cause.

Some City Council members said the next step should be to fire Zahn with cause and begin a nationwide search for his replacement.

“This isn’t complicated. There is cause to fire Aaron Zahn,” Diamond said. “He should not get another penny of taxpayer dollars."

Incoming City Council President Tommy Hazouri said that while the sale is over, the investigations into the process of the sale are still happening.

“We’re not stopping. We’re digging to see what lies beneath,” Hazouri said on Monday.

Several City Council members are calling for a grand jury investigation of JEA -- on top of an investigation started by the State Attorney’s Office. Diamond said the City Council should open its own investigation into the matter.

“I think we can decide almost immediately after we get back from this break. We need to get in there, decide on an investigation, give it subpoena power and get to the bottom of it,” Diamond said. “People really, really believe JEA was doing something wrong, and if they were, let’s find out. Let’s put it all out there and let the cards fall where they may.”

The City Council is proposing a resolution that would require officials to go through the council auditor during any other sale process.

“It’s a great Christmas present for the citizens of Jacksonville,” Hazouri said of ending the sale talks. “It’s long past due.”


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