“Absolutely yes”: Clemons’ GRU governance bill sails through House State Affairs Committee
BY JENNIFER CABRERA
TALLAHASSEE, Fla. – House Speaker Pro Tem Chuck Clemons’ local bill establishing a governor-appointed governing board for Gainesville Regional Utilities (GRU) sailed through the House State Affairs Committee today.
In introducing the bill, Clemons (R-Jonesville) pointed out that the bill passed through a local legislative delegation hearing by a vote of 4-1 and said that it maintains local control of GRU with appointments by the governor of five members who must reside in the GRU service area.
Rep. Anna Eskamani (D-Orlando) asked what interest the State has in oversight of GRU, and Clemons responded, “The State has compelling interest to make sure that a public utility doesn’t go broke.” She asked for the evidence that it’s going to go broke, and he responded, “Currently, this particular utility, Gainesville Regional Utilities, which has 800 wonderful employees that have provided more than 100 years of service to our community, has four times the level of debt… of comparable utilities of their size.”
Eskamani asked whether the utility had declared bankruptcy or whether there have been “rankings to push it in that direction, or is it paying off that debt in some sort of plan?” Clemons responded, “It’s paying off those debts by raising rates on the backs of the people in our community who can afford it the least. Their rates are from 25% higher than other utilities to 50% higher for small commercial users.”
Eskamani asked what actions the City of Gainesville has taken to try to address those rate hikes, and Clemons responded, “Well, for the last 20 years, relatively few. In the last ten years, that particular utility, through the Board of Directors that are current, which are the seven City Commissioners, have withdrawn $100 million more than the net earnings. And in the last four years, they’ve withdrawn $67 million more than their net earnings. This is a crisis. This bill will help to right the ship and provide stable leadership and separate the City Commissioners from the apparent conflict of interest that they’re currently undergoing.”
Eskamani asked whether any other municipal utility “fits under this proposal of a State-mandated board,” and Clemons responded, “There are 33 municipal utilities… six of those utilities are governed by a board such as this.”
Rep Joe Casello (D-Boynton Beach) asked if any other energy producers are interested in taking over GRU. Clemons responded that he had no knowledge of that, and “What I can assure you… is that this particular board will not have the authority to sell any assets of Gainesville Regional Utilities. That must come before a referendum of the voters of the City of Gainesville.”
Rep. Ashley Gantt (D-Miami) asked whether all members would be appointed by the governor “and if so, will there be an application process to pick from the pool?” Clemons said the governor would choose from a “variety of nominees that can come from anyone, including commissioners. They would have to fall within the categories: one person outside the City of Gainesville who is a user of the utility, one person who represents a commercial interest, and three of the five must have some area of expertise in energy, in accounting, in law, or in those sort of things.”
Gantt asked whether there is a mechanism for citizens to “have hearings or express concerns to the appointed board if need be?” Clemons said, “Yes.”
Eskamani asked whether the utility has ever missed a debt payment, and Clemons said he couldn’t speak to that.
Hinson’s first amendment
Chair Lawrence McClure (R-Dover) then took up the proposed amendments. Rep. Yvonne Hinson (D-Gainesville) introduced her first amendment by saying she gave an opportunity to the “many Gainesvillians in the audience” of the local legislative delegation hearing “to do an amendment of a shell bill that Rep. Clemons put forth at that delegation meeting… The only difference between the bill and the strike-all [amendment] asks for the board members to be elected, conducted by the Supervisor of Elections.”
Rep. Spencer Roach (R-North Fort Myers) said the amendment looked like it would wait until 2025 “to try to solve this problem. Why would you want to wait that long?” Hinson replied that “the strike-all says August 2024.” However, according to her amendment, that is the date of the election; the initial terms of office would start on January 1, 2025.
During public comment, Sarah Younger said that Hinson’s amendment preserves Home Rule, and Bobby Mermer said the amendment is a “pretty reasonable compromise.”
Hinson’s amendment was voted down by the committee.
Hinson’s second amendment
McClure then took up Hinson’s second amendment, which was based on the most recent version of the bill filed by Clemons. That amendment specifies that the Authority will not have the power of eminent domain “without the express validated agreement of the owners, which are the citizens of Gainesville.” It also specifies that the members of the Authority will not be paid a salary and caps their expenses, and Hinson said the amendment specifies that “the Authority will have no power to sell, transfer, or gift the GRU to another utility without the express and validated permission of their owners, the citizens of Gainesville.”
During public comment, Sarah Younger said, “I urge you to vote for this amendment. It is highly likely that this utility will come up for sale; we have interests that have shown already interest in our utility. This is an attempt to rob us of our asset that is owned by the people of Gainesville, not the State government.” Bobby Mermer said, “So this is the very least you can do, this is still a board appointed by the governor, who, you know, we didn’t vote for in Gainesville, but at the very least, you can make absolutely sure that they can’t sell our public utility.”
In closing, Hinson said, “I was a Gainesville City Commissioner in 2012-2015, and I have witnessed an aggressive pursuit of GRU by legislators since that time. Its genesis did not begin today. I personally traveled here twice during that time to testify in takeover legislation. The picture being painted of its bleakness is just messaging. It’s messaging to make it look like they’re that deep in debt. They have a plan already to crawl out, they have met with JLAC. JLAC has given them an opportunity to crawl out of this debt and to make a plan. Let’s give Gainesville a plan to keep their utility.”
Hinson’s second amendment was voted down by the committee.
Public testimony on Clemons’ bill
In public testimony on the bill, Mermer urged the committee to vote no, “and remember, unintended consequences. This is a conservative-majority committee, in a conservative-majority legislature. As conservatives, you should be scared of unintended consequences. Do you want another JEA? This is the way to get another JEA. Vote no.”
David Hastings said the bill “presents a large amount of uncertainty and the possibility of huge pitfalls.” Jeffrey Shapiro warned that “negative economic impacts on residents may be tremendous but are not represented in the economic impact analysis. Expecting five unpaid state appointees to meet only monthly, no defined local government connections, is untenable.”
Younger said GRU “reflects a tradition of local freedoms and Home Rule.” Susan Bottcher said, “GRU is financially strong and stable. Fitch, Standard and Poor, and Moody’s have given them the grades of A+, A, and AA3, respectively, which means they possess superior intrinsic financial strength, very predictable stable operating environment, and obligations subject to very low credit risks. The other problem with this bill is that it absolutely removes the voice of all GRU ratepayers, not just the ones who live in the city limits. So that’s why we wanted to provide elections, so that everybody could have a voice in the governance of our municipal utility.”
Nancy Deren said, “This legislation is supposedly to address utility debt burdens on the City and its ratepayers; it does not. Assertion that there will be no economic impact is not supported by the facts presented by the attorneys and bond counsel opinions regarding both the 2017 and current versions of the bill. Rating agencies want to see transparency, predictability, and consistency. Part of the reason we have investment-grade ratings with a stable lookout is a long history of City governance consistent, and a sudden change to an autonomous Authority with no history will ruin our bond rating.”
Gainesville Mayor Harvey Ward complained that he and others had to come 150 miles to speak about the bill and said that “the City of Gainesville Commission has already taken bold and drastic action as requested and directed by JLAC. We have instituted a formula for our utility transfer, we have cut it by more than half, and I would love to talk with individual members of the committee as this moves forward, and I would love for some of you all to join us this Friday evening as we have a hearing in Gainesville.”
A joint City Commission/Utility Advisory Board meeting will be held at 6 p.m. on Friday, April 21.
Jay Rosenbeck said, “Customers don’t pay rates; customers pay bills–that is the application of a rate to their usage. Gainesville actually has very low bills in comparison to all of the [investor-owned utilities] in the state. Gainesville bills in 2021, the last year for which full data was available, were $103 on average for residential customers, compared to $125 for FPL, $143 for Duke, and $135 for TECO.”
Janice Garry said, “HB 1645 usurps the will of voters by an authoritarian state government.” She said the bill would affect GRU’s bond ratings and the financial stability of Gainesville.
Jenn Powell said, “This bill contains no protections for GRU workers. This bill will allow an unelected and unaccountable board virtually unlimited power to destroy the hard-won wages and benefits we fought for, with zero recourse for them. If this legislation is really interested in saving GRU, they will get the University of Florida to pay their fair share.”
Closing and vote
In closing, Clemons said he needed to respond to “so much disinformation” and said, “The Charter prohibits City Commissioners or any others from disposing of, agreeing to dispose of, in whole or in part, the City’s electric or water production. It cannot sell GRU with this new board… We want to make sure this is good for the next hundred years, and the only thing we are doing is taking away the checkbook from the seven City Commissioners and the previous City Commissioners, who have put Gainesville Regional Utilities in this position.”
The bill passed through the committee on a vote of 14-5, with Rep Mike Caruso, the Co-Chair of JLAC, voting, “Absolutely yes.”
It ain’t over till the fat lady sings. However, I can hear her warming up!
That would be Harvey you’re hearing…but he ain’t singing, he’s crying.
Ward has also said he would push for the transfer this year would be under 10 million another lie out of his mouth it’s 15 million what I don’t understand is why they do posted the profit of GRU over last 4 years they have taken 68 million more than the profit how do we know they are not still doing it
Just hope the state follows though and take over
I hope Ed Bielarski is the first person appointed to the new Board.
… and Nathan Skopp !
It’s funny how the world works sometime.
Caruso must have been watching the meetings and marveling at the stupidity. “Reversing the no open container law is hard!” “Police dogs is hard!” “Ima only work 20 hours a week now!” etc. Ward is starting to look sort of weak and dumb (if we didn’t know that already).
How did the Failed Biomass Bully Hinson Rawls City Commission puppet get into any decision making position? How clueless is her comment that the City of Gainesville magically is now concerned with their obscene debt? Why did they not do that 10 years or $100,000,000.00 ago? Only by force are they coming up with a plan that is putting everything back on the ratepayers , they have no soul. So stuff it failed commissioners and reckless backers . Currently no one would by GRU until it somehow rids itself of a massive ration, that for some reason no other public utility has managed to obtain.
If we go thru all this and the ball and chain is still connected to County residences and taxslaves it will be a big disappointment. And no one wants to Annex into a bankrupt city. So when GRU is on the auction block next year all GRU Customers should vote on the sale, not just the City Dimwits that got us here in! the first place. City Commissioners and Mayor and supporters, pucker up and buckle up , financial turbulence is on the radar , Big Time.
Clemons is an enemy of Gainesville and Alachua County, so no surprise, nor is it a surprise that the other GOP commission members did their usual lap dog act to help Ron Napoleon take over another seat or commission that never voted for him and never would. Those of you cheering this are not conservatives who oppose big government. You love it if the autocrat is a republican.
By the way, thanks to Jennifer for fully reporting comments, including by the opposition and the public.
Oh yeah: “Gainesville bills in 2021, the last year for which full data was available, were $103 on average for residential customers, compared to $125 for FPL, $143 for Duke, and $135 for TECO.”
Not for the same usage. DUH
So, GRU residential customers are particularly frugal and conservation minded, or is it our cool summers that explain the difference?
Ed, can you elaborate? How can that argument (of GRU having lower bills than FPL, Duke, etc) be true?
It is false
“Back in the U.S.S.R.”, you must be able to blow that on your horn pretty well.
I’m sorry but my average bill for my 2770 sq ft home for GRU is $800, are you kidding me, that is crazy money!
Jennifer might appreciate your compliment more if it wasn’t preceded by a lot of hogwash. Clemons is a decent man and a good public servant. He personally helped me with something when he was a county commissioner. Repeating “Clemons is the devil!” over and over again isn’t going to change anyone’s mind here. It just makes you seem evil or something. Are you upset that DeSantis isn’t allowing drag queens or groomer books in Florida schools? I bet you are.
I have been specific about Clemons – and the GOP’s -vendetta against his home county, which includes attacking it’s method of electing county commissioners, even though most counties in the state have the same system (they are not single member districts) and did it with a dishonest campaign launched at the last moment before it could be refuted (hopefully the County Commission will over throw this partisan attempt), voting to punish Alachua County schools by closing access to funds awarded to high performing schools because the board challenged Ron Napoleon’s covid rules in court (as it’s local experts at UF advised), and now wants to take away control of City of Gainesville property from voters and hand it over to our known enemies, including him and the Governor. Maybe he’s nice to puppies and has helped constituents like you – that’s a minimum for a good human and elected representative – but when he seeks to screw and overturn acts by elected leaders because of their party and tries to gain power he can’t win at the ballot box, he’s a bad one.
Did I mention that he and his partner in crime, Sen Perry who is only still in office because of illegal dark money from FPL – hmmmmm? – have had more of Alachua County cut out of their districts in the last gerrymander? Gee, I wonder why.
Wonderful, old-school word; “hogwash”.
Sure as hell like to see where you get this BS your putting out about rates
2800 sq home hills of Santa Fe GRU
Average 385 a month 3500 sq home in branford Fl with Duke average to 230.00 month the one in Gainesville is my wife and I 51 and 65, Branford two boys in early 20’s
Completely false nonsense from an uninformed libtard:
“ Oh yeah: “Gainesville bills in 2021, the last year for which full data was available, were $103 on average for residential customers, compared to $125 for FPL, $143 for Duke, and $135 for TECO.”
Get your facts straight and learn how to look up data.
What should be alarming is that we’re 4 months into 2023 and they don’t have the numbers for 2022 yet. Either they can’t find someone to doctor the books or there are still a lot of unpaid (overdue) bills from 2022.
Where’s Hanrahan who ruined GRU going biomass and sticking us with that bad purchase agreement? Democrat leadership has been a disaster. Go woke, go broke. Has anyone tried calling GRU customer service lately? The wait time is terrible.
Please indicate your source for data.
GRU is second highest in all comparisons. Check it here…
Gets past committee – ✅
Two more to go…
I’m sure he won’t have a problem finding a skirt to dry his tears with.
If he has a stroke, I won’t lose any sleep.
The city’s golden goose will be no longer as far as electricity milking goes. But isn’t the city talking about milking other rates on the utility bills, like gas, water, trash pickup — and property taxes?
Elections have consequences indeed.
Just watched the video of this sham hearing. The chair kept complaining about how much was on their agenda – his problem, not the citizens – and went from 3 minutes public comments on other bills to 30 seconds on this one. Cut and dried with no representatives actually listening to these short comments. Typically for Gainesville, opposition public comments – there were no positive ones – were weighted toward well informed to PHd types with facts and data. The mayor was cut off after his 30 seconds – what a sham! – as was the rep for FRU workers. Hey Representatives, don’t be so obvious about how you don’t GAF what the public says or how far they travelled for this travesty. Highlight for me was Clemons – after throwing out bogus claims about how bad GRU was – saying he couldn’t comment on the question of whether GRU had missed a debt payment. What a toad, and what a sham this legislature is. Their gerrymandered super-majority means they do whatever they want, or should I say what the Governor wants, and brook no input.
By the way, FPL lapdog Perry – he owes them his seat – sat next
to Clemons. How long until these creeps are term limited?
Guess he watched too many of Poe’s past meetings.
About time Ward & cronies got a taste of what they’ve been giving out to citizens for years.
You obviously forgot that it was bill 1355 with 106 speakers that they went to 30 seconds with. Quit the bull crap lies, and tell the truth for once! Or maybe your forgot that there was someone there that chose to listen and watch that was for the bill. And that person also knows the complete truth.
As comprehensive as always.
Here are the Jan. 2023 rates for Gainesville compiled by the Florida Municipal Electric Association:
1,000 kWh – Residential
Base Rate: 102.63
Fuel Adjustment: 80.00
1,299 kWh Residential
Base Rate: 124.39
Fuel Adjustment: 96.00
2,500 kWh Residential
Base Rate: 265.83
Fuel Adjustment: 200.00
In all three usage costs, Gainesville has either the highest or second highest rate in Florida for that time period.
The one-year average (Jan. 2022-2023) does not deviate much from those numbers or ranking by FMEA.
What isn’t mentioned much is the ‘fuel adjustment’ costs and I defer to those who know how that has worked within GRU and what, if any, markup has been applied.
It is disingenuous for Jay Rosenbeck to state the only latest numbers available are from 2021 and the average ‘bills’ were, “…$103 on average for residential customers.”
Those are patently false statements made to obfuscate not only the mismanagement of GRU but to lead customers to believe GRU is a ‘bargain’ compared to other utilities; municipal owned or otherwise.
Errata: In all three usage costs, Gainesville has either the highest or second highest BILLS [not rates] in Florida for that time period.
The fuel adjustment is supposed to only cover the actual cost of fuel. The GM sets the FA charge and has a lot of leeway depending on how much they want to keep in the fund, so it can include a markup. NG prices went way up the last couple of years. But from the beginning of 2023 NG prices have gone way down again. GRU, FP&L & Duke have all announced that they were reducing their FA charges in the past month.
Thanks, Fred UP.
Because the actual cost FA isn’t easily accessed and based upon what I saw on the FMEA comparison charts, other municipalities are either getting a better deal on NG or Gainesville is tagging 15-25% more on their FA.
Either way, the customers deserve a better deal.
Preadventure it is possible to save GRU and bring its rates back to an acceptable level.
The trouble is the Republicans appointing their cronies to fill the oversight chairs.
Hurry up and wait.
Can’t be any worse than what’s happening now…it’s past time for some grown ups to step in.
Makes my day seeing the CC get their hands slapped away from the cookie jar 😊
Well done Rep. Clemons!
This is Chuckie owning the libs and selling out to FPL. I bet in six months Gainesville will find out FPL wrote the bill.
Apparently you haven’t even read the bill! Or you are a complete …
It is ironic to see so many progressives touting a bond rating as proof of their managerial competence.
The high ratings for GRU are based on three things: 1) monopolistic ability to raise rates, 2) expected population growth in the service area and 3) an assumption the city will use taxing power to assist GRU. They’ve maxed out #1 and proven #3 to be false. How many new customers can the current GRU physical plant serve?
BTW, one reason Jay Rosenbeck, et al keep referencing data from 2021 (not the latest) is because it, GRU, fits the narrative of an A+ bond rating by Fitch in 2020-2021.
What the same people don’t like to hear is in January of this year Moody’s downgraded Gainesville’s issuer rating to Aa3 from Aa2 based solely on the high debt level.
It is clear what the commission’s strategy has been; use GRU base rates and fuel adjustment as a ‘tax’ to pay down the city debt which it hasn’t even come close to doing according to Moody’s.
To cover this strategy Rosenbeck continues to mislead customers by saying, “Gainesville actually has very low bills in comparison to all of the [investor-owned utilities] in the state.”
Again, that is patently false and is the reason the bipartisan JLAC took action.
Parenthetically, as in all matters involving governance the political positioning and disagreements are part of the process we call democracy.
The voices I heard and read from democrats did not defend GRU’s mismanagement and only gave a brief opposition to removing the city commission with interest to maintaining local control. That is a reasonable position and as the bill progresses it will evolve with those concerns addressed further.
For the mayor to complain the city’s compliance is going unnoticed is akin to the bank robber requesting merits for only stealing some of the money.
The city’s public arrogance and entrenchment in false narratives is not helping their allies in Tallahassee.
Janice Garry said, “HB 1645 usurps the will of voters by an authoritarian state government.” She said the bill would affect GRU’s bond ratings and the financial stability of Gainesville.
Garry failed to mention Gainesville’s recent Moody’s downgrading because of debt, not GRU or the constitutionally lawful intervention by the state. That falls short of ‘authoritarian.’ Trying to shape the perception of the problems through such narratives doesn’t match the math or the facts.
If there is a malfeasance present in the actions of the legislature or governor as some have alleged, why hasn’t the city filed the claim to a court?
The city will sue and have already stated so.
You write as if anyone will actually read and consider the issue and input from the pubic and experts. Dude, that’s what they do in committee and none of that happened yesterday. Watch the video. No one listened because no pone had time to say anything, and I mean literally. It was a cooked goose from the beginning.
Those celebrating this kind of BS either think GRU and utility rates are more important than democracy or just want to “own the libs”. The precedent of hostile take overs by the state is anti-democratic and some day may have different teams in power. As noted, GRU has not defaulted, though Clemons pretended he couldn’t speak to that, and unless Chuckie and Keithie are going to write checks, nothing the new “board” does will be something the current commission can’t do, and if they don’t, citizens can replace them, like they did the zoning Nazis of last year. The new board will be in power for ever, the will of Gainesville voters forever stifled on this issue, and big government idiots will celebrate a win for the team.
I guess you missed the city attorney when he told chestnut that the state had very broad authority when it came to utilities when she asked if the state could just take over GRU
Oh well, then there can’t possibly be any law suits over this, and the “State” can do whatever it wants.
Happy Days are here again!