Clemons Files Gainesville Regional Utilities Bill, Creates Governor Appointed Governing Board

By JENNIFER CABRERA/Alachua Chronicle

TALLAHASSEE, Fla. ‒ Florida House Speaker Pro Tem Chuck Clemons (R-Newberry), on April 10, 2023, filed HB 1645, which would create a governor-appointed board to govern Gainesville Regional Utilities (GRU).

The board, which will be known as the Gainesville Regional Utilities Authority, will begin governing GRU on Oct. 1, 2023, if the bill passes. The Authority’s powers and duties will include managing, operating, and controlling all GRU utilities; establishing and amending all rates, fees, regulations, and policies related to selling utility services; acquiring property and constructing projects, provided that the title to all of the property is vested in the City of Gainesville; exercising the power of eminent domain; issuing revenue bonds to finance or refinance projects; disposing of GRU assets under the same conditions that the City Commission must meet in disposing of those assets; submitting a budget to the City Commission every year; and appointing and/or removing GRU’s General Manager.

Each member of the Authority must be a “person of recognized ability and good business judgment as identified by the Governor,” and they are expected to perform their duties “in the best interests of GRU and its customers.” Except for one member who must be a resident of the unincorporated area of Alachua County or a municipality other than Gainesville, members must be qualified electors in the City of Gainesville and must maintain their primary residence within the electric service territory of GRU’s electric utility system.

• One member shall be a residential customer “with substantial knowledge of GRU, its operations, and its history.”
• One member shall be the owner or a representative of a private, non-government customer consuming at least 10,000 kilowatt hours per month of electric usage during each of the previous 12 months.
• Three members shall be competent or knowledgeable in one or more of the following fields: law, economics, accounting, engineering, finance, or energy.

Members can be removed if they stop receiving GRU electric service at any time during their appointment. If more than 40 percent of GRU’s electric meters serve customers outside the city limits in the future, the governor must appoint a second member who lives outside the City limits at the time of the next appointment. Members of the board are not term-limited.

Authority appointment process

The governor will issue a public notice soliciting citizen nominations for the board at some point between July 1 and Oct. 1; the nominations will remain open for 30 days, then the governor will appoint the initial members of the Authority. One member’s term will expire on Oct. 1, 2024; one will expire on Oct. 1, 2025; one will expire on Oct. 1, 2026; and two will expire on Oct. 1, 2027. Subsequent appointments will be for four-year terms.

The first meeting of the Authority is set for 6 p.m. on Wednesday, Oct. 4, 2023, and the first official action of the Authority will be the election of a chair and vice chair from among its members; the GRU General Manager will serve until the Authority appoints a General Manager.

Authority members will not be compensated, but expenses can be reimbursed after the approval of a majority of the members. The Authority will meet monthly and will be a Sunshine board.

All GRU employees will report to the General Manager, who will have the exclusive authority to hire, fire, and set salaries. The General Manager’s salary will be set by the Authority.

The existing Utility Advisory Board, or any other utility advisory board established by the City Commission, will “have no role with respect to the Authority.”

The bill puts a cap on the General Services Contribution (GSC), which is currently referred to as the General Fund Transfer (the amount transferred from GRU to the City’s General Government budget each year). The GSC may not exceed the amount left over after operating expenses (as defined in the bill) are subtracted from net revenues. The bill states that any excess funds above the GSC shall be dedicated to debt service or used as equity in future projects.

The Authority is required to make decisions based on “only pecuniary factors and utility industry best practices standards, which do not include consideration of the furtherance of social, political, or ideological interests.” The bill further specifies that these factors “are those which solely further the fiscal and financial benefit of [GRU] and customers.”

The bill will likely have committee hearings before it goes to the floor of the House and then to the Florida Senate, but those have not yet been scheduled. The last day of the Florida 2023 Legislative Session is May 5, 2023.

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