Seth Johnson
The Gainesville Regional Utilities Authority will discuss the annual money transfer from the utility to the general government of Gainesville at Wednesday’s workshop. While no decision has been made or scheduled, city leaders and the local Alachua County Labor Coalition have already sounded off on the issue.
Gainesville Regional Utilities (GRU) staff will present on the fiscal impacts of cutting or reducing the transfer, called the general services contribution. Authority members asked for the information along with the legal backing it has to change the transfer.
The city of Gainesville uses the transfer to fund government programs, and the GRU transfer has been the city’s second largest source of revenue. For the 2024 fiscal year, the city is slated to receive $15 million—less than 50% of past years.
However, new management by the authority could bring change. As the authority focuses on reducing debt and lowering base rates, members have questioned sending millions of dollars to the city.
Authority members, select legislators and some community members view the city as abusing its past control and money transfers—using GRU as a personal piggy bank to subsidize city services while the utility drowns in debt.
A press release by GRU on Tuesday points out that the transfer peaked in the 2019-2020 fiscal year at $38.2 million—more than the utility’s net revenue and forcing the use of reserve funds.
Tony Cunningham, GRU’s general manager, said the options presented on Wednesday will help the authority members make an informed decision based on the impact on customers.
“We are looking at all options,” Cunningham said. “We need to make business decisions that are in the best interest of our customers and the utility, so we are thoroughly vetting a variety of alternatives with the GRU Authority.”
But for city leaders and other community members, eliminating millions from the city’s budget could come with unacceptable consequences.
The Alachua County Labor Coalition (ACLC) held a press conference on Tuesday to protest any change to the general services contribution, with members of the Sierra Club, Alachua County League of Women Voters and the Central Labor Council.
The ACLC press release points to a December memo from City Manager Cynthia Curry to back up its position. The memo, reported by Mainstreet, warns community groups to expect no funding from the city if the transfer is cut.
Curry also said an eliminated transfer would mean heavy cuts in every department, including police and fire that received budget increases last year. The city cut 125 positions last year, the majority were empty, and reduced budgets in many departments.
Even with the cuts, the city commission approved a 16.9% increase to the property tax rate to level the budget. Given the previous cuts, the City Commission might return to a property tax increase if the general services contribution is eliminated.
Commissioner Bryan Eastman also warned in December that an eliminated transfer will likely lead to layoffs.
The backup documents for Wednesday show two options analyzed by GRU. A complete elimination of the transfer and a $7.8 million reduction to the transfer. With both those options, GRU also analyzed using all the savings to lower rates and using half the funds to lower rates with the other half going to debt.
All four scenarios would reduce rates in the short term compared to the current plan. However, three of the four scenarios also show rates rising again by 2034. GRU needs more income from the rising rates to meet its 2034 target reserves.
Backup documents show the electric and gas divisions will meet their target reserves, but water, wastewater and telecommunications will fall short by a combined $93 million.
The litmus test should be whether or not the quality of life really improved, or not.
Sounds like a great time to really trim the fat at Gainesville and GRU.
Unfortunately, the people that make these decisions are part of the fat and will end up cutting the people that actually deliver services to rate payers and citizens. The city already did this by cutting nature operations, parks and rec, traffic, RTS etc lower end positions but giving the (too many) charter officers/advisors raises.
Same thing will happen at GRU, critical departments (water/electric) are already running lean, and reliability/safety is suffering while there are way too many managers, supervisors, and directors that make well 120K+ and barely have anything to do.
Please vote differently in the future.
Throwing away that proverbial credit card IS painful but necessary. Many of the local social programs and initiatives in the City of Gainesville that are currently funded (wholly or in part by GRU $$$) could conceivably be taken over by local churches, private companies with vested interest in the community or private benefactors (maybe UF can tap into their huge endowment fund to sponsor some of the affected organizations and have UF students contribute their “expertise” to manage them as part of their education). In short – The Board is making the tough decision and it won’t be pretty but reality never is. I’d prefer a total cutoff now but if it can be phased in over 2 years or so then so be it. Either way GRU needs to return to the stable utility it once was.
Chapter 2023-348 Laws of the State of Florida, also known as HB 1645 established the GRUA board which is currently creating chaos in the city of Gainesville. Financial starvation and chaos is the intent of the law. For years, Republican law makers have chafed at not being able to out vote the citizens of this city. They have gerrymandered state legislative districts to win elections but have been unable to win the city commission. The law states in Section 7.12, that the GRU management “shall consider only pecuniary factors and utility industry best practices standards, which do not include consideration of the furtherance of social, political, or ideological interests.” What this means is that a city government with half of its taxable properties off the roles will no longer be able to support and nurture women owned businesses, minority owned businesses, veteran owned businesses. The city won’t be able to help the youth that are entering the business world or workforce for the first time. The city won’t be able to help the homeless. All of these social efforts to make our city a more livable community are specifically prohibited by this illegitimate law. The citizens of Gainesville should make their voices heard at these GRUA meetings.