JACKSONVILLE, Fla. – JEA could soon be making record payments to the City of Jacksonville as part of a new proposal that includes some multi-million dollar increases.
This proposal comes as JEA is also proposing a rate increase for its customers, raising the question of whether the extra money the utility is paying the city is contributing to the rate hikes.
The JEA Board‘s Finance Committee met on Tuesday and approved the proposal. The publicly-owned utility has contributed to the city for decades, making payments to support the city’s budget and operations.
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Even if customers won’t see any fees directly tied to the utility’s contributions to the City of Jacksonville, they are still paying them.
According to JEA’s bill breakdown, there’s a portion of a customer’s monthly utility bill collected by JEA for the City of Jacksonville. This supports “general government services not related to JEA.”
On a customer’s actual bill, this charge is included in the electric or usage charge. There’s a special formula JEA uses to calculate this amount.
It comes out to about $12 a month for the average customer. In JEA’s 2025 budget, 7 cents for every dollar of a customer’s electric bill and 6 cents of every dollar of the water portion goes toward the City Contribution.
But many people are wondering, is the extra money the utility is paying the city contributing to proposed rate hikes?
JEA officials maintained the two issues are not related.
“Right. Yeah, there is [no correlation.] I can’t, I can’t expand anymore,” Chair of JEA Board of Directors, Joseph DiSalvo, said.
The agreement lays out JEA’s financial contributions through 2029.
In 2023, JEA contributed $122.4 million, with that number increasing slightly to $123.6 million in 2024.
But in 2025, JEA’s payment will jump to $137.4 million.
Contributions are set to increase by 1% per year from 2026 to 2029.
A one-time $40 million payment will also be sent to the city in 2026, funded by JEA’s Electric System. That payment will be covered primarily through money JEA is saving.
“Basically, we restructured our debt, which saved us some money. So some of that savings goes, a large chunk, to that $40 million,” DiSalvo said.
Jacksonville Mayor Donna Deegan was involved in the negotiations, a spokesperson for the mayor’s office said she asked for the extra funding to support city services.
The mayor’s office initially preferred to have the $40 million payment spread over four years, but JEA officials agreed a one-time payment was in their best interest. The funds will still be spread across multiple years in the city budget.
“It’s part of a negotiation, but it’s also part of our city charter,” JEA spokesman Joe “Myers” Vasquez said.
As for the rate increases planned for later this year, JEA still has a target effective date of April 1, 2025. Base rates will increase by about 4%.
“What’s really driving these rate increases is our obligation to Plant Vogtle and the capital projects we envision in the next three to nine years to better serve our community,” Vasquez said.
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In years past, additional payments to the city by JEA were used for specific projects like the phaseout of septic tanks in older neighborhoods.
When asked how the city plans to use the $40 million additional payment, a spokesperson said: “It can be used in any way the city needs to from the general fund. We have not made any decisions yet about what specific projects it will go towards, other than it will fund projects that are one-time expenses/non-recurring.”
The agreement will go before JEA’s full board for approval and then through the city council.