The Gainesville Regional Utilities (GRU) Authority approved changes to the budget and discussed attorney services at its Wednesday meeting—action that was overshadowed by the firing of General Manager Tony Cunningham.
Even after the 4-1 vote to dismiss him, Cunningham still presented on the scheduled agenda items. Two days earlier, the authority directed Cunningham to tighten the GRU budget for fiscal year 2025, following cuts highlighted by Chair Ed Bielarski.
The authority wanted GRU to find an additional $5 million in capital investment savings, along with $12 million in operations and maintenance. Cunningham said staff made the reductions and were still looking at how the cuts will impact rates, reserves and the general services contribution (GSC).
The cuts could also impact the city of Gainesville’s current budget as GRU considers asking more for the IT services it provides. Originally, GRU planned to update the cost to general government for those services in the next fiscal year.
Cunningham said GRU might generate around $3 million, on top of the current payments, from general government for those IT services. GRU staff say the price general government has paid for IT services hasn’t covered the costs—a position Gainesville staff questioned.
Other reductions included defunding 27 vacant positions at GRU. Cunningham warned that the move could increase overtime costs and hurt employee retention, but the utility will also save $3.31 million.
He said the operations and maintenance cuts could cause slower response times, customer complaints, reduced workforce development and higher maintenance costs and less odor control.
Cunningham recommended not cutting $250,000 in natural gas rebates. Instead, GRU found more operations and maintenance cuts to keep the rebates.
The GRU Authority passed the changes unanimously.
The GRU Authority also plans to keep Folds & Walker as its legal representation, with a contract extension coming, likely, this week.
However, larger legal issues remain in the background concerning who can represent GRU.
Since the GRU Authority took over in October 2023, the issue of legal representation has cropped up repeatedly. The authority hired Folds & Walker in December to provide limited legal services for the authority but not GRU staff.
That contract remains, but GRU staff also released a request for proposals for a law firm to provide comprehensive legal services for the entire utility. City Attorney Dan Nee has called that kind of representation a violation of the City Charter and illegal, and the utility hasn’t pursued the proposals further.
Scott Walker, one of the attorneys for Folds & Walker, said the firm has gotten along well with Nee and the city office despite disagreeing on the interpretation of the City Charter and the bill that created the GRU Authority.
He said the goal has been to resolve the issue internally, but that may not be possible.
“I do think that the potential for litigation, particularly with the vote for the referendum, is very high,” Walker said, referencing the city commission’s recent ballot initiative.
A motion on Wednesday directs staff to send a letter to Florida’s attorney general for an opinion on whether GRU can create its own attorney office to handle all of its affairs.
Walker said the attorney general’s office doesn’t typically interfere with intergovernmental disputes.
A second part of the motion directs staff to hire an outside legal firm, with expertise in Florida constitutional law and local government, to analyze the legality of GRU creating its own attorney positions and stopping the use of Gainesville’s city attorney—Nee.
Once the opinion comes from the outside firm, the GRU Authority can decide how to move forward.