Jacksonville City Council votes to hire special counsel to help with process of potential JEA sale

$1.8 million approved for attorney ahead of potential JEA sale

JACKSONVILLE, Fla. — Jacksonville City Council members voted to hire an attorney to help them understand how the process of potentially selling JEA, works.

Hiring special help cost the city and taxpayers $1,850,000.

City Councilman Michael Boylan told Action News Jax's Courtney Cole that city leaders are serious about making sure voters and customers have a voice in the potential sale.

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"The intent overall, for you and I — you as a voter and myself as a City Council member and a voter --  is the need to understand the facts behind all of this entire process,” Boylan said.

There are currently nine companies are in the bidding process for JEA.

Aaron Zahn, the CEO of JEA, told Cole selling the public utility is  only one  of the five  options they're exploring.

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Zahn says not taking any action could have a big impact on employees.

"For example, in the last 10 years, we cut 407 jobs. In order to keep up with the industry changes and the financial performance of the business, we'd be looking at cutting another 500 jobs going forward,” Zahn said.

And then there’s you, the customer.

Zahn has said it has raised rates 71%  in the last 10 years.

If things don’t change, he said rates could potentially rise 50-60%.

Cole: “A Recent TU article talked about rates actually going down. How do you respond to that?”

"What they were look at, is they were looking at fuel rates. Fuel, like your car, right, has dropped around 60% since 2011. While the fuel cost has declined, our actual base rates, or what we charge customers to provide service, has increased 71%,” Zahn said.

The sale of any or all of JEA will have a huge economic impact in Jacksonville.

Boylan says it's time for the City Council to be part of the conversation.

Tuesday night City Council voted to hire special legal counsel to help with that.

"The fact of the matter is — a number of firms have come forward. I have personally spoken to a number of different counsel, not only locally, but across the state who have a lot of history with this kind of work and are actively interested in doing it,” Boylan said.

Law firms have until Friday to formally express their interest.

Cole: “How confident are you that you can get gain council and public approval?”

“That's premature. So I have not personally made by own decision. At the end of the day, as CEO, (my job) is exploring all the potential outcomes for JEA,” Zahn said.

Boylan said the council's plan is to get the public  involved in the potential sale of this public utility.

They want to do that by hosting 10-12 workshops to explain how we got here and how each possible scenario would play out.

Cole also spoke to Zahn about the other options they’ve analyzed besides privatization and their authority to even sale JEA.

Zahn said in May, the public utility analyzed how JEA would perform if it didn't change now or expand its water or energy businesses.

"In June, we came back and presented what we call the traditional utility response. The reason we called it the traditional utility response is (the opotion would involve) continuing implementing initiatives that JEA has implemented over the last 10 years,” Zahn said.

In July, Zahn said JEA started working with JPMorgan and Morgan Stanley to explore three remaining options, including the sale of JEA.

Cole: “Does JEA really have the authority to sell or does that not rest with the city?”

"It rests with the public. JEA's board has the authority to investigate all the potential strategies JEA can employ,” Zahn said.

But it doesn’t end there.

"The board actually makes this decision. Then the board then sends it to City Council. City Council then, they'll discuss it, debate it I'm sure. Even then the authority lands finally in the hands of the voter,” Zahn said.

Boylan says it's important customers first understand the issue on which they’re voting.

“Fact of the matter is, a lot of options (are) on the table and we need to be informed and educated about those options. Legal counsel will help us understand those things, to communicate those things and participate in the workshops that we're going to be hosting,” Boylan said.

We will keep you updated as we learn more. Be sure to download the Action News Jax App for the latest updates.

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