JACKSONVILLE, Fla. — The City of Jacksonville could soon receive more than a $100 million financial boost from JEA, raising the question of what it means for ratepayers.
JEA and the mayor’s office have worked out a deal to have the utility give the city $40 million in 2026, plus an additional $15 million per year from fiscal years 2025-2029, with annual 1% increases.
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In 2024, JEA sent the city nearly $124 million.
The utility has made yearly payments to the city for decades in lieu of property taxes and says it has money to cover the extra payment by restructuring its long-term debt.
Action News Jax Ben Becker first reported in May 2024, that the city was pushing the utility for an additional $15 million per year. A source told Becker the city wanted to use JEA as a “piggy bank” to help pay for the city’s portion of the stadium renovation, which eventually was revealed to be $775 million. The mayor’s office denied at the time asking for the additional money for the stadium.
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JEA says the contribution in 2026, after the one-time payment, works out to about 8.9% percent of its revenue.
Comparable utilities pay about 7% of revenue, according to the utility.
The money JEA is sending to the city raises the question if it could have been directly used to lower rates.
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Becker posed questions to a utility spokesperson:
Q: What does the rate trajectory look like and what would it look like if the restructuring savings were used for operations instead of payment to city?
A: We are anticipating incremental rate increases for the next three-year planning cycle.
Q: What are the total dollars to city? (there are taxes that don’t show up in operations or rates because they are pass through)
A: $181M-$225M including franchise fee. (See Spreadsheet below)
Q: Is there any other part of the budget that increased 11.3 percent?
A: Budget forecasts will be included in board package in advance of Feb. 25 meeting.
Q: What is the financial value of the nitrogen credits?
A: Nitrogen credits are currently valued at approximately $5M.
Q. When was the modeling for the debt restructuring contemplated as a use of the savings, and is there modeling if it went to rate relief?
A: There was not any modeling done related to the electric debt restructuring in September 2024.
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The JEA board’s Finance Committee is expected to vote on the measure during its meeting next Tuesday. The agreement must also win approval by the JEA board and by City Council.
JEA sent the following statement to Action News Jax:
“Through close collaboration, JEA’s executive team has negotiated with the mayor’s office an amended contribution agreement that is being advanced to the JEA Board and City Council for final approval. The terms and conditions of the agreement, if approved by Council and the JEA Board, run through Sept. 30, 2029. If approved, the one-time $40 million contribution would be paid through debt restructuring savings and additional forecasted revenues. This allows JEA to minimize customer impact while also supporting general city government services.”
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