“It’s about protecting [the] next generation’s taxpayers.”
That’s how Group 4 At-Large City Councilman Matt Carlucci describes legislation he’s introducing that would require JEA’s unfunded pension liability to be paid off immediately if the public utility ends up being sold.
If JEA is sold there would an unfunded pension debt of approximately $338 million the city would be responsible for, according to Carlucci, since that liability wasn’t made a required part of the bid proposal from potential JEA buyers.
JEA is soliciting bids to potentially sell the utility for a minimum of $3 billion, which Carlucci says a majority of voters would ultimately have to approve, in addition to the JEA Board and City Council.
Carlucci has made it clear he doesn’t personally support JEA being sold.
“I don’t support the recapitalization of the JEA. I think public and local control of the JEA is priceless,” Carlucci said Thursday.
But realizing it may ultimately be sold, he wants to make sure taxpayers down the road aren’t left holding the bag for what could end up being a ballooning pension debt. He said the legislation came about as result of talking with City Council auditors.
“Whatever the net proceeds would be if this recapitalization is successful, I suspect that there’ll be other members - perhaps the Council, the [mayor’s] administration – that would want to decide at that time how to spend the money, which may or may not include the unfunded liabilities from the JEA,” Carlucci said.
Mayor Lenny Curry told WJCT News during an August interview if JEA is sold, he would want to use some of the proceeds get rid of city debt, although he didn’t specifically address the unfunded JEA pension liability that Carlucci is citing.
“The first thing I would do is pay down all of our city debt, the $2.2 billion. What that means is you get detached, you wipe out $240-plus million of debt service every year. So right now we spend $240-plus million to service our debt. That cost will be gone and would be accessible in our operating budget to invest in neighborhoods all over this city,” Curry said in August.
WJCT News reached out to the Mayor’s Office to see if Curry anticipates supporting Carlucci’s legislation. This story will be updated once a response is received.
Carlucci said the JEA pension liability is separate from the sales tax that voters approved extending in 2016 to cover the city’s pension obligations for firefighters, police and other city employees.
“I’m just trying to be proactive on the unfunded liability. Because if we don’t tackle that, those are big numbers, and big numbers have a way of compounding in a big way,” he said.