JEA may have underbilled its commercial customers for water capacity fees by $55 million since 2003, according to a new report from the Jacksonville City Council Auditor\u2019s Office.<\/p>\n
The auditor\u2019s findings were outlined Monday at the first meeting of the council\u2019s newly created three-member Financial Audit and Oversight Committee<\/a>.<\/p>\n JEA first started investigating the issue internally in 2022, but legal documents show that the policy on collecting water capacity fees has been inconsistent<\/a> since before JEA was formed, as far back as 1986.<\/p>\n In the last 18 months, the city-owned utility ramped up its review into why companies and development projects undergoing expansions or growth were not being charged the added fees to connect to water and wastewater plants.<\/p>\n The issue came under more scrutiny at City Hall early this year when the Office of Inspector General asked council auditors to help it investigate the issue, what it has cost the utility and whether JEA had the legal recourse to recoup any of the losses from its commercial customers.<\/p>\n Former City Council President Kevin Carrico wrapped the water capacity investigation into his broader charges for the politically controversial<\/a> JEA Special Investigatory Committee. The committee, now ended, investigated JEA leadership\u2019s handling of workplace culture.<\/p>\n Days before current council President Nick Howland took over leadership July 1, he announced his intent to let the investigative committee sunset. In its place, he formed the 60-day select committee with the sole charge of working with the auditors and JEA to understand the cost the unbilled fees had on the utility and to find policy changes to fix it.<\/p>\n The committee includes Chair Ron Salem, council Vice President Joe Carlucci and council member Chris Miller.<\/p>\n JEA uses revenue from the capacity fees to pay for new water and wastewater treatment plants, expanded and modernized facilities, and any infrastructure linked to these services.<\/p>\n \u201cWhen you build a new plant, as people connect to it, they kind of purchase their portion of the plant, their little slice of the pie,\u201d JEA Chief Water Systems Officer Rob Zammataro told the committee. \u201cThose capacity fees help pay for that infrastructure that we have bonded up front. So whenever somebody pays for a capacity fee, whether it be water or wastewater, it\u2019s specific to the capacity and the capital improvement.<\/p>\n \u201cIt has nothing to do with their consumption. They\u2019re a monthly bill.\u201d<\/p>\n Salem said Monday that he recognizes that the capacity fees are independent of rates JEA charges its residential and commercial customers for the amount of water and wastewater they use.<\/p>\n