JACKSONVILLE, Fla. – JEA recently earned a key bond upgrade from Moody’s Ratings, which said the improvement was due to stronger finances and progress in the utility’s governance.
It also received a positive credit action from Fitch Ratings for both its Electric Enterprise and Water and Sewer System, which are rated separately.
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“JEA’s mission is to provide essential services to our customers every day, and these rating actions recognize the progress our team has made to strengthen our financial position, invest responsibly and serve our customers well,” JEA Managing Director and CEO Vickie Cavey said in a news release.
But Moody’s report also included a warning.
The ongoing turmoil at the city-owned utility could send the rating in the other direction.
What these ratings mean for customers
Credit ratings help determine how much public utilities pay to borrow money for major infrastructure projects.
For customers, stronger ratings can mean lower borrowing costs over time, which can reduce pressure on future rates. Ratings do not determine bills by themselves, and a rating upgrade does not automatically lower monthly charges.
But the same principles that allow bills to potentially go down when JEA receives higher ratings also mean they could go up if the utility’s bond rating is downgraded.
For public utilities, bond investors are betting on more than today’s balance sheet. They also watch whether leaders can make decisions consistently, follow rules, respond to oversight and maintain public confidence — especially when a utility needs rate adjustments, large capital projects or complex contracts.
Moody’s explicitly listed governance stability and continued progress rebuilding stakeholder trust as key credit considerations for JEA.
If that progress reverses — for example, through prolonged political conflict, leadership churn, or weakened oversight — the agency said it could become a factor in a future downgrade.
So how might that happen?
According to Moody’s, a future downgrade could be triggered not only by financial stress — such as higher-than-expected payments or a bigger capital plan — but also by “deterioration in governance stability or a reversal of progress in rebuilding stakeholder trust.”
That caution from Moody’s seems particularly pointed as JEA leadership faces renewed scrutiny amid ongoing public drama.
For months, tensions between the Republican-controlled Jacksonville City Council; Mayor Donna Deegan, a Democrat; and JEA have mushroomed into a convoluted, revolving series of controversies that have generated three parallel investigations.
The State Attorney’s Office has issued at least three subpoenas amid swirling questions about JEA, Council President Kevin Carrico and the Boys & Girls Clubs of Northeast Florida, where Carrico is a vice president.
Florida Attorney General James Uthmeier’s office also recently sent JEA a subpoena of its own seeking to learn more about a canceled contract between JEA and Ballard Partners, a high-powered lobbying firm that employs Curry, the city’s former Republican mayor and a critic of Deegan’s administration.
In addition to the subpoenas, Jacksonville City Council’s Special Investigative Committee on JEA continues to follow a mandate from Carrico to investigate claims of a toxic workplace culture and racism at JEA and questions about water/sewer capacity fees.
Capacity fees are one-time charges billed to new customers based on projected water and electric usage; some accounts may not have been adjusted after businesses expanded beyond initial projections.
Why Moody’s upgraded JEA
For now, Moody’s said JEA has delivered consistently strong results over the past three fiscal years and has made a long-term effort to reduce debt, including more than $2.3 billion in debt from fiscal years 2013 through 2025.
The agency said JEA has shown it can implement base rate increases when needed to support debt paydown.
Moody’s also said the utility has made progress in strengthening governance under a reconstituted board and management team.
JEA argued that Moody’s actions underscore the importance of organizational stability, including consistent leadership and Board oversight, as JEA continues executing its long-term strategy.
For a municipal utility, bond ratings can directly influence the interest rate it pays when borrowing money for large projects such as power plants, grid upgrades, storm hardening and technology replacements.
Moody’s uses letter grades to signal credit strength:
- Aaa is the highest rating.
- Aa ratings (including Aa3) are high quality and indicate very low credit risk.
- A ratings (including A1) are still strong but carry somewhat higher risk than Aa.
The number ranks strength within a category: 1 is strongest, then 2, then 3. In simple terms, Aa3 is stronger than A1.
Moody’s now rates the JEA Electric Enterprise at Aa3, and the Water and Sewer System is rated at Aa1.
JEA pointed out that it is among the largest community-owned utilities in the United States, serving more than 540,000 electric customers and providing water, wastewater and reclaimed water services to Jacksonville and portions of neighboring counties.