GRU to cut unfilled positions, reduce maintenance

Gainesville Regional Utilities sign
Gainesville Regional Utilities sign
Suzette Cook

Gainesville Regional Utilities (GRU) presented its plan to reduce $3.4 million of expenses as part of the city’s overall efforts to cut $315 million in GRU net debt over the next 10 years.  

The majority of the expense reduction, $1.9 million, will come from unfunded employee positions. Mark Benton, GRU’s director of accounting and finance, said 20 full-time employee positions remain unfilled at the moment, and instead of setting money aside to fill the roles, he said the utility will use that money as savings and not hire. 

The other $1.4 million will come from reducing preferred maintenance, tapering chemical prices, cutting sponsorships and a smaller LEEPplus program.  

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“We don’t want to cut things that are ultimately going to haunt us next year, but there are things that we are pushing off and deferring that we know are ultimately going to come back,” said Brett Goodman, GRU’s chief operating officer.  

General Manager Tony Cunningham said that even with a $175,000 reduction to the planned LEEPplus budget, the utility will still have an increase for the LEEPplus program over last year—and the largest ever.  

Cunningham added that some reductions come from anticipating higher costs in the past. He said for the Advanced Metering Infrastructure, or smart meters, staff predicted the need for more positions that can now be cut as installation continues. As of May 5, the utility has installed 19,500 smart meters.  

To reach the $315 million reduction, GRU said it would find $28 million in expense reductions in the next 10 years—or $2.8 million a year. The utility is slightly above that goal with its $3.4 million planned reduction. 

GRU General Manager Tony Cunningham
Courtesy of city of Gainesville Tony Cunningham

Cunningham said the reductions were tough to find since the GRU has run a fiscally tight utility over the past five years. In that timeframe, the utility’s operations and maintenance budget has increased by $2.66 million, and the utility has increased by 15 full-time employees—mostly contractors that GRU hired.  

Commissioners asked how deferring maintenance could impact GRU in the future.  

Cunningham said the risk of a sudden maintenance cost will increase but that the utility will still continue with the majority of its preferred maintenance activities and all of the vital ones.   

Next year’s budget plan avoids large items that GRU will need to address in the next decade—an integrated resource plan, decommissioning energy plants and how to structure GRUCom. Cunningham said this budget will get GRU through the next year and give time for an updated plan to tackle those challenges in the longer term.  

The Gainesville City Commission approved the plan to reduce GRU’s net debt by $315 million on April 13. GRU selected $315 million because a reduction of that size will lower the utility’s capitalization rate from 86% to a targeted 70% ratio. The plan relies on several large reductions including a $119 million cut from the general government budget over the next 10 years.  

That funding would have come from a GRU money transfer called the government services contribution. The city approved a formula that reduced the transfer by $16 million, 55%, for the next fiscal year.  

The general government side, including the offices of the city manager, city attorney, city clerk, city auditor and director of equity and inclusion, will need to make up that $16 million reduction for the next fiscal year. Gainesville’s 2024 fiscal year runs from Oct. 1, 2023, to Sept. 30, 2024. The general government offices will present an initial plan at 3 p.m. on Wednesday. 

Of that $315 reduction, another $76 million will come from the city commission’s planned rate increases through 2027. The commission approved a series of yearly increases in 2021. Organic debt reduction will account for $91 million.  

Gainesville commissioners touched on local bill HB 1645 that currently sits on Gov. Ron DeSantis’ desk. If passed, the city commission would no longer have control over GRU, and an independent authority appointed by the governor would take over.  

That authority would have the power to change rates and alter the city’s current plan to address GRU debt.  

Mayor Harvey Ward said that possibility and assumptions on the authority’s potential actions cannot cloud the commission’s decisions.  

“There are lots of different things that an authority could move forward with or could not move forward with,” Ward said at the meeting. “We can’t let those things enter into our decision-making, honestly. We have to make good decisions based on what’s in front of us and what we are charged with and what we have sworn ourselves to do as commissioners.”  

In a press release on Monday, both Cunningham and Ward said the utility’s sole focus was the delivery of all utilities at all times despite the potential switch in control. 

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Don’t worry , Mayor and Commissioner’s real help is on the way . We’re thinking utility rate reductions equal to the City of Alachua’s rate. All City Buildings get our old rate . Then we are going to double that $119,000,000.00 savings on 10 years on you kickbacks and make it $238,000,000.00 in 8 years. When you are ordered to return the $68,000,000.00 siphoned off from non existing GRU profits over the past several years , we may just save GRU. To heck with ya’ll ,you have shown us what you can do. Now if you decide to sue us, well you don’t want to see plan B.

Gabe Hillel Kaimowitz

There is a simple solution to this nightmare. It is time to merge City and County to avoid duplication and end the nonsense of a funding disaster. Voters rejected such a merger years ago, but certainly, it is time to have that discussion. Also, I am tired of this top-down version of reporting. Readers want to know what services we won’t be getting. I want to be sure that the entire GRU PR staff is cut. Meters probably will stop being read. Inspections, e.g., of the LEEP program probably will be ended if they ever existed. I was a LEEP participant. The City never had a final inspection,. My air conditioning/heating system became dysfunctional in less than five years.


Gabe, why in the world would a County resident want or desire to join in a relationship with a Bankrupt City and Utility?


I’m not familiar with the terms “preferred maintenance.” DEferred maintenance I understand, but not PREferred maintenance. Somebody, please educate the old guy.


Hmmm . . . cutting maintenance. I don’t think that’s going to end well. My neighborhood already has frequent power outages, so maybe I better invest in a big home generator.

Jeff Gehmann

Great, after helping and cheering on this fiscal disaster wasting millions of dollars, Ward now claims to have the the key to solving this debt crisis. BS Ward! You would’ve, could’ve, and should’ve done a lot of good things, but like most wannabes, you sat on your hands and cheered on the waste. No thank-you for your interest now. Take a hike! Go find Poe and play Bingo!