JEA Approves $2.37 Billion Budget for Jacksonville

JEA budget meeting with Jacksonville skyline

News Summary

The JEA Board of Directors has unanimously approved a significant budget of $2.37 billion for fiscal year 2026. This marks a $250 million increase from the previous fiscal year, with notable contributions to city services totaling $348 million. Key allocations include substantial investments in the Electric, Water, and District Energy Systems. Despite increasing operational costs and a 3.7% rise in utility rates for customers, the budget sets a robust financial foundation for Jacksonville’s future, as it awaits City Council approval by October.

Jacksonville – The JEA Board of Directors has unanimously approved a fiscal year 2026 budget totaling $2.37 billion, marking a significant financial commitment to the City of Jacksonville. The budget is scheduled to be delivered to the city by July 1 and requires City Council approval by October 1, which aligns with the start of the new fiscal year.

In a move to bolster city services, JEA plans to contribute a total of $348 million to Jacksonville. This contribution comprises public service taxes, city franchise fees, and a one-time payment of $40 million drawn from JEA’s Electric Fund. This one-time payment is being enabled through the conversion of variable-rate debt to fixed-rate, which resulted in a savings of $38 million for JEA.

The approved budget showcases a substantial increase compared to previous years, with a nearly $250 million rise from the fiscal year 2025 budget of $2.121 billion. The capital budget has also seen a notable boost, now at $1.017 billion—up from $892 million—allowing for greater investment in infrastructure and essential services.

Operating Budgets by System

JEA has segmented its budget into various systems, each with specified allocations:

Electric System: An operating budget of $1.595 billion and a capital budget of $406 million.
Water System: An operating budget of $759 million and a capital budget of $574 million.
District Energy System: An operating budget of $15.09 million and a capital budget of $37.6 million.

State Contributions

Further contributing to state revenue, JEA is set to pay $75.4 million in gross receipts and sales taxes to the State of Florida.

Rising Costs and Rates

The budget reflects anticipated future expenses, expecting a 40.9% increase in spending over the next two years, projecting $1.434 billion in outlays. This is driven in large part by a staggering 203% increase in expenditures related to electric transmission lines and generation.

On the consumer side, JEA ratepayers have experienced a 3.7% increase in their average monthly utility bills due to a midyear rate adjustment. This adjustment is rooted in a projected $117 million rise for fuel used in generating electricity and an additional $39 million jump in operational and management costs. Such operational increases primarily reflect rising labor costs and the management of new reclamation facilities.

Future Projections and Agreements

To further secure its financial future, JEA’s Finance, Governance, and Audit Committee will vote on a proposed agreement intended to raise contributions to the city, projecting a total of $741 million over the next five years. This agreement outlines a strategy for contributions to incrementally rise from $137.4 million to $178.8 million in the first year, with a 1% increase anticipated annually thereafter.

Local Reactions

The proposed increases in contributions have not been without controversy. Some city council members have voiced concerns regarding the implications of these contributions, labeling them as a “backdoor tax increase” that may place additional financial burdens on JEA customers. This discussion highlights the ongoing debate regarding the nature of JEA’s financial contributions, which act as a substitute for property taxes and support crucial city services, including public safety and parks.

The budget’s integration and its extensive implications for Jacksonville’s fiscal landscape signal a pivotal development in local governance and utility management, setting the foundation for the city’s financial future as it gears up for fiscal year 2026.