JEA Board to Consider Mass Layoffs/Privitization

[Steve]

Who chooses the board?

Ole' Lenny!

[thelakelander]

'Legal theft': CEO Aaron Zahn defends C-suite bonus scheme, refuses to resign

https://floridapolitics.com/archives/313666-zahn-refuses-resign

[Steve]

Reading the tweets from some folks at the T-U (who BTW, have done an awesome job covering this) - there's no way Zahn has a job by COB tomorrow. Curry's strongest allies are all like, "WTF" as details come out. This is beyond bananas.

The question is who else should go? Bottom line is while the board can say they were pissed about this bonus plan, do they not have a fiduciary responsibility to ask to see numbers? Assuming they weren't presented with fabricated numbers, they have a stake in this too.

[thelakelander]

Time to clean the house and start fresh.

[Steve]

I'll give Mayor Curry a ton of credit. I didn't think it would be possible for a 19 member, split party City Council to agree unanimously on something. I think Curry just proved me wrong.

[itsfantastic1]

Now is the time to be very wary. Zahn will be the fall guy, but all the other accomplices on the JEA board and the Mayor will try to skate out clean; some potentially thinking they can salvage this "recapitalization" effort.

Diamond asked for a motion to panel an investigative inquiry, which I think is one step below the grand jury Carlucci was asking. Based on Diamond's actions today, I'll give him the benefit of the doubt and think he aims to get to discover if any crimes were committed but being a Curry ally makes me wary that his true intentions are an attempt to keep this out of the courts.

[jaxlongtimer]

NAACP calling for a Congressional/Federal criminal investigation, not just of JEA executives and its board, but the Curry administration:

https://www.jaxdailyrecord.com/article/naacp-calls-for-federal-criminal-probe-into-possible-jea-sale

And, they added these items to their list of concerns:

The letter lists several areas of concern by NAACP officials with the Curry administration's actions.

Those include his support for delaying a referendum to bond for $1.9 billion in improvement to Duval County Schools; appointing his then Chief of Staff Brian Hughes as interim director of the Downtown Investment Authority — a role where he would advise policymakers on allocating taxpayer-backed incentives to private businesses; and hiring practices and a "lack of transparency" at the Kids Hope Alliance.

As one who recalls the city and county wide scandals leading to consolidation in 1968,  I am starting to get deja vu .  Curry and Hughes mistreatment of all who did not toe their line looks to be boomeranging on them.  Once they are radioactive, good luck getting anyone to blindly follow them going forward.

[Bill Hoff]

The question is who else should go? Bottom line is while the board can say they were pissed about this bonus plan, do they not have a fiduciary responsibility to ask to see numbers? Assuming they weren't presented with fabricated numbers, they have a stake in this too.

The board hired the guy and has signed off on his decisions/priorities. They need a mirror.

[jaxjags]

At yesterday's Council meeting with the JEA Board, Rory Diamond made a good summery of the "employee incentive plan":

Diamond said the most conservative estimate would have valued the payout at nearly $100 million. He noted that's three times the amount the Kids Hope Alliance spends on children's programs in a fiscal year.

"I see a group of executives who know this thing is going to be sold, and then they say the best way to do this is a stock option," Diamond said. "The stock option doesn't exist under any law in Florida, so let's come up with a performance unit plan. Let's get a lawyer to push it through, get outside counsel to say this works. Let's check with the state attorney's office for the ethics, doing all the legal parts right but the math never changes."

From other info obtained, time for a board and management reset.

[Steve]

Zahn is done (without cause) after a 5-1 vote. April Green was the dissenter as she believed he needed to go, "with cause".

[thelakelander]

So he was given a golden parachute?

[Tacachale]

So he was given a golden parachute?

That's Duval, baby!

According to the FTU reporters on Twitter, the lawyers will try to negotiate a limit on the golden parachute.

[thelakelander]

So walking away with nearly a million for being a complete screw up?

[thelakelander]

Cash-Hungry Cities Seek Buyers for Sewer Systems to Pay Pensions


...In Pennsylvania, the city of Allentown and Middletown Borough sold long-term leases for their sewer and water systems to pay down pension debt in 2013 and 2014. Jacksonville, Florida, is exploring the sale of JEA -- the largest community-owned water, wastewater and electric power utility the state. The city is seeking at least $3 billion in net proceeds from the profitable utility after paying off $3.6 billion in outstanding debt on its books, according to financial filings.

Jacksonville has cited a changing utilities industry as one of the reasons for a sale of an asset that was able to contribute $132.8 million to the city's general fund last fiscal year. The city's three pension funds are a collective 55.7% funded and have $3.2 billion in unfunded liabilities, according to its most recent financial report.

Still, using proceeds from an asset sale to shore up a pension system carries risk of its own, said Thomas Aaron, a senior analyst at Moody's. An infusion of cash from a sale would immediately increase a plan's assets, but those funds would be invested according to the style of the plan -- meaning they are subject to market forces, Aaron said.

https://www.bloomberg.com/news/articles/2019-12-17/cash-hungry-cities-seek-buyers-for-sewer-systems-to-pay-pensions

[jaxlongtimer]

Zahn is done (without cause) after a 5-1 vote. April Green was the dissenter as she believed he needed to go, "with cause".

Not sure this is the whole story per this quote on the Times Union blog:

16 minutes ago
JEA board places Zahn on leave indefinitely while city attorneys investigate, negotiate

The JEA board voted unanimously to place JEA CEO Aaron Zahn on administrative leave indefinitely while city attorneys conduct a seven-day investigation to determine if they have grounds to fire him with cause.

They need to terminate with cause or he also gets a 1/2 million retention bonus if they sell.  I don't see that happening with the voters but why risk it.  Also, need to send a message in the strictest way to others, including Curry, that their backhanded games won't be tolerated.