GRU Authority Holds Back on Eliminating Government Services Contribution

The Gainesville Regional Utilities (GRU) Authority met for nearly five hours yesterday in their longest meeting yet, discussing the government services contribution (GSC) and Tony Cunningham’s position as general manager (GM) of GRU. 

Chair Craig Carter began the meeting by saying the issues discussed would be sensitive and decisions would be made based on finances.

During comment on non-agenda items, consumer of GRU, Kim Popejoy, claimed the board has no right to exist. 

“This, [HB] 1645, is a charter amendment. I’m no attorney, but I’ll tell you, I have dug and dug, and I cannot find anywhere any example of a charter amendment occurring in the state of Florida that did not include a plebiscite. That did not include asking the local municipal citizenry to vote on that charter amendment."

After some debate on which items should be talked about in which order on the agenda and some brief comments from Cunningham and the authority’s attorney, Scott Walker, Member Eric Lawson updated the board on the ongoing search for a new GM. Last meeting, Lawson was put in charge of coordinating the search.

He stated the hiring firm the board agreed on, Mycoff Fry Partners, cost $90,000 for their services, with the board only having put $50,000 towards the prospect. Lawson didn’t believe they were overcharging, but that the board couldn’t afford the service with the amount being put towards it. After assessing all the fees, Lawson determined the cost of a GM search could be up to $480,000 if the board looks at multiple options or up to $100,000 if the board decides to hire the first choice they are given. 

Lawson clarified that the process to hire a new GM would be intertwined with Sunshine Laws, meaning any interviews with potential hires would be open to the public.

Vice Chair James Coats called Cunningham an “incredibly nice person,” but said the search for a new GM should continue if the funds are available to do so. He suggested the board table the item, saying he couldn’t justify spending half a million dollars on the search. He also let the board know they had the option to stop the search completely or to fire Cunningham and replace him with an interim. 

When asked for his opinion by Carter, Lawson said the process should take a year due to the board’s recent creation.

“We are all so new to this. We’re just learning to be a board, to be honest. I’m learning how to interface in front of the public. We’ve studied so much. What I haven't seen are major financial variances. What I’ve seen is 15 years' worth of decisions that put us here.”

Lawson went on to defend Cunningham, saying he had not seen “gross mismanagement” at GRU and that the board should give him general budget and safety guidelines. He recommended the board give him a year to see if he was meeting their expectations. The board previously agreed to do this before starting the search. Following his comments, several attendees broke order and applauded Lawson for his statements.

Member Karow motioned to put the issue off until the end of the meeting, which was seconded and passed.

Moving on, Cunningham gave his recommendations for budget cuts the board should consider to reduce GRU’s debt, such as cutting equal opportunity services by 20% and broadcast services by 5%. He also recommended a quarter of the city clerk’s and city auditor’s offices be cut. Totaling $2 million in expenses, Cunningham clarified that these numbers were estimates before suggesting the board cut $180,000 from these services each month over the next fiscal year.

Coats motioned to give Carter the right to meet one-on-one with the City of Gainesville charters to get more information before a decision is made.

During time for public comment, some attendees called the board out for motioning to give the chair the ability to meet with charters in private. Former City Commission candidate Jo Beaty said that private meetings have led to a long road of problems in the city.

“I respectfully ask you to not meet with them as the two of you. I think you should invite them here to one of the meetings… Have whatever discussion you would have with a charter or charters, and have that in the public. A part of how we’ve got to where we are is because of these meetings… City commissioners meet one-on-one with charters, there are a lot of things that have been really kept out of the public realm. You have a lot of people who have been here almost as long as I have watching this whole debacle evolve. We have a lot more experience than your admitted lack of experience in understanding of GRU. People like many of those who have spoken to you tonight have a lot of information but are privy to what happens behind closed doors. I think you’ll find us a valuable resource."

The motion to allow Carter to meet with city charters and come back to the board with a reduction number passed. 

Moving on to the budget cuts, Karow said the board shouldn't worry about the city as if it were a “600-pound gorilla that would come back and do something.” He made a motion that the board accept the recommendations made by Cunningham, which was seconded by Coats.  

The motion was met with criticism, with multiple speakers saying that making budget cuts without talking to the city contradicts the previous motion. After hearing the public’s comments, the motion was passed with Lawson's dissent. 

Moving on to the next item, the board began to debate about the GSC. Walker clarified that his stance was that the board could legally take away the GSC.

Karow voiced his position in favor of discarding the GSC, saying he believed not getting rid of it would be a violation of the law.

Carter said he understood Karow’s reasoning but that he didn’t think ratepayers would benefit from sacking the GSC.

After GRU’s Director of Accounting and Finance, Mark Benton, gave a presentation on various outcomes based on different GSC debt reduction scenarios, Lawson presented the possibility that ratepayers would end up paying more after getting rid of the GSC due to the City of Gainesville introducing new taxes to offset the reduction. Karow held his position, which Carter openly disagreed with.

“I’m not in a position right now to vote to eliminate the transfer. I don’t have enough information. I don’t want to just have them go to the ratepayers to get the money someplace else and then walk around and say, ‘I lowered the utility bill, but you still can’t buy your groceries.’

Karow replied sarcastically, “The city sounds like the creature in the little shop of horrors that said, ‘Feed me, feed me.'

Carter responded, “Sir, I’m not going to disagree with you... I’d look at my own checkbook to see if I had the money to go back and expose how this happened. Half the people in this room know how it happened. I think it should be exposed. I think it’s terrible. City commissioners made some bad decisions to be first in this or the best in this and hurt this utility… I want to see what the consequences are going to be. That’s all.”

Karow motioned to reduce the GSC by 100%.

The motion did not receive a second. Coats clarified that he did not second because he knew that Lawson and Carter were against the motion, which would’ve caused it to die had he seconded.

Carter brought forward the idea of forcing the city to reimburse the authority for projects that GRU paid for, which largely benefited the city. He pointed out that if the GSC is gotten rid of, then it would likely be the 31% of GRU ratepayers who live in Gainesville who would be affected. 

“We will look like heroes; people will call us tonight and say, ‘You guys are great; you should slit their throats and let them people die or whatever.’ Ultimately, the citizens of Gainesville ratepayers are going to be paying the bill.”

Coats proposed an all-day joint meeting be held with the city commission and the authority within 45 days after his fellow board members voiced approval. It was seconded by Lawson. 

This motion resulted in the largest number of people making public comments at an authority meeting so far, with 16 stepping up to either commend the board for their caution or to criticize the motion at hand.

Gainesville resident Wilbur Holloway spoke against the city government, saying they do not know how to do their jobs.

“The reason we got here is because we have groupthink. It's a bunch of progressives; they’re not professionals. They have no experience. None of them have done what you do. None of them have run a business. None of them have signed paychecks. They just have ideas and emotions… The mandate is to pay down the debt. Let the city of Gainesville make up the 15 million, let them sell that to the voters, and then let them reap the consequences of those actions… The bottom line was that they didn’t cut their budget. They raised our property taxes by 29%. They’re idiots.”

Gainesville resident Alex Hood received pushback from Carter after he mentioned his name when opposing the elimination of the GSC. 

“You know, Commissioner Carter, you are on the city. When these cuts come in, the first ones that they’re hitting are police and fire, and then they’re hitting—

Carter interrupted, “I don’t buy that,” and called it a “scare tactic."

Hood replied, “How this would work was there would be a 10% reduction to all services, and since police and fire have the two biggest budgets, that 10% reduction would take the biggest hit. It would be a 4 million and 1 million dollar hit… If we cut the city’s budget by 25%, that’s going to result in a loss of jobs.”

Multiple members of the Alachua County Labor Coalition spoke, all saying they were “pleasantly surprised” by the board’s caution towards GSC reduction or elimination.

Following public comment, the motion for the authority and the city commission to meet and discuss the GSC within the next 45 days was passed with Karow in dissent.

The board finally circled back to discussing Cunningham’s employment. Coats proposed the board have GRU’s Chief Financial Officer, Claudia Rasnick, become a co-CEO of GRU with Cunningham. The idea was briefly considered by Lawson and Karow, however, with heavy caution. Carter said Cunningham would quit, and that environment could not be worked in. 

Karow said that the search for a new GM should continue and motioned that the board continue with recruitment firm Mycoff Fry Partners with a $45,000 increase in spending so they could afford their service.

After hearing the public’s comments, the board passed the motion with Lawson in dissent.

Following member comment, the meeting was adjourned.