JACKSONVILLE, Fla — As a special city committee continues its investigation into what went wrong at Jacksonville's municipal utility, the current head of that utility is expected to go under oath in the coming days to give her side of the story.
Melissa Dykes currently serves as interim CEO of JEA. Prior to the departure of former CEO Aaron Zahn, who is currently under the spotlight for the failed privatization and bonus plan processes, Dykes served as Chief Financial Officer of the utility.
On Monday, Councilman Rory Diamond, who heads city council's special committee tasked with investigating the utility, announced his request that Dykes be immediately deposed.
"As the interim CEO of JEA, I think we need to hear from her," Diamond said after Monday's meeting of the special committee. "We need to find out what she knew about the performance unit plan, we need to hear what she knew about the [invitation-to-negotiate] process."
A topic of contention at the start of the meeting was the status of a massive documents request by the committee. As of Monday, JEA had not handed over a single document.
"This is our entity, they can't hide documents from us," Diamond said.
Diamond added that investment banks involved in the invitation-to-negotiate, or ITN, process would be subpoenaed along with the bidders who responded.
During Monday's meeting, which was the third session of the special committee, the council heard testimony from two sworn witnesses: a current member of the senior leadership team, and a former member of the senior leadership team.
Steven McInall currently holds the title of Vice President of Energy and Water Planning at JEA. He spoke after Michael Brost, who was a VP and general manager at the utility.
McInall challenged the presentation by law firm Nelson Mullins at the committee's last meeting, in which attorneys laid out due diligence findings to draw the conclusion that data presented to the board by JEA's senior leadership team purposefully painted a bad picture of the utility's outlook.
McInall called the presentation "skewed," saying the firm did not talk with JEA beforehand and their findings were "misleading." He added that he spoke with Melissa Dykes about the findings, and she "was not a fan."
"It seems very clear that back at JEA, they don't like what we're doing here," Diamond said. "They're disagreeing with what they're hearing here. I want to know why they're getting so aggressive and against us. We're all on the same team."
Another takeaway from McInall's testimony was a line of questioning on behind the scenes conversations regarding the performance unit plan (PUP), a controversial bonus plan that could have netted executives millions of dollars if JEA was sold.
McInall's sworn deposition from January 2 seems to show that Dykes knew and relayed to McInall that the number of shares that could be purchased through the PUP was directly related to the results of an employee review.
As reported by our news partners at the Florida Times-Union, a virtual data room was established for documents prepared by contractor Intralinks for outside consulting firm Pillsbury Winthrop Shaw Pittman. During Monday's hearing, McInall testified that he was the person on JEA's senior leadership team in charge of who had editing and deleting access in the data room.
"It all related to the fact that we haven't gotten any documents from the JEA to date," said Councilwoman Randy Defoor. "Apparently the Pillsbury firm came in and wiped out a lot of documents in the data room, and that information is significant to our ability to figure out what happened."
Meanwhile, Brost heavily criticized the senior leadership team's handling of the strategic planning process that involved the ITN.
"Status quo, doom and gloom, sky is falling. They could have done a whole lot more, but they didn't want the answer to be 'JEA is a public utility and can do all of these things to remain viable,'" Brost testified.
Brost was asked by Councilwoman Joyce Morgan which members, specifically, of the senior leadership team were most involved with the ITN. He named Ryan Wannemacher, the utility's former Chief Financial Officer, as well as the outside consulting firms working on behalf of JEA.
"They were along for the ride, so to speak," Brost said of other members of the senior leadership team.
Brost said Zahn was not qualified to be in the position of CEO, and that he was shocked at the portrayal of the utility's future. He left his position in January 2019.
With Dykes expected to be deposed within a week according to Diamond, a significant amount of executives remain at JEA who were involved with the ITN process.
"It does concern me," Defoor said. "The very people that were running the show during the ITN process are the same ones who are telling us we can't receive these documents."
