GRU Authority discusses $47M federal grant, cost-saving measures and urgent repairs at monthly meeting
The Gainesville Regional Utilities Authority held its monthly meeting Wednesday night, discussing cost-saving measures, federal funding for infrastructure upgrades, urgent repairs and the recent Gainesville ballot referendum.
GRU reviewed its debt management policy to strengthen financial stability and reduce debt Since 2020, strategic budgeting and transactions have saved almost $200 million.
In 2024, with better budgeting and internal savings GRU made nearly $40 million in extra payments to cut debt and plans to reduce it further by 4% next year. It's aiming for $140 million in total costs over two years paying down its debt, which has amounted to nearly $2 billion.
GRU Chief Financial Officer Claudia Rasnick discussed the utility's investment plan. The board updated the investment policy to prioritize safe, accessible investments like bonds and avoid high-risk assets. The board now oversees policy updates and cash management previously handled by the city commission.
The board also addressed ongoing financial agreements with the city regarding significant service areas, including IT and streetlight costs. The agreement for GRU to provide IT services to the city was signed at $2.9 million, but the services cost GRU $5.9 million to provide, leaving a $3 million shortfall for 2024. GRU proposed extending the IT contract in negotiations with the city by a year to recover these funds, but the city declined.
GRU pays the city millions of dollars annually in what's known as a general services contribution, which pays for city services like payroll and human resources. The board recommended honoring existing agreements but recouping $2.6 million the city owes for streetlight costs — a debt dating back to a 2023 agreement. GRU plans to reduce its payments to the city by $1.3 million annually unless the city directly covers these streetlight expenses.
GRU's Deerhaven Renewable turbine, the biomass plant, needs urgent $1.1 million repairs after cracks were found in critical components during a scheduled outage. Custom parts from Switzerland will be installed in North Carolina, and the turbine is expected to be back in service by early February.
A motion passed to prepay for natural gas, which CFO Rasnick said can allow for savings of $2-4 million annually, maybe more. The board expects this to be implemented for the next 30 years with the flexibility to apply the discount to electricity instead.
"This analysis would really be passed straight through to the customer, so this is not going to be used for debt-to-fees and debt reduction," said Eric Lawson, GRUA board chair. "This is truly impacting the rates for our customers."
This meeting marked the first time GRU shared a utility monthly update, which will share essential projects, relevant utility measurements and benchmarks of the utility's state, according to the meeting's agenda.
"This is the first iteration of what I hope will become GRU's key performance indicators," said Bielarski.
According to Bielarski, they plan to issue quarterly press releases so customers can access the information quickly. They hope to help the average GRU customer understand GRU's performance and promote transparency.
This is the first meeting since GRU was awarded a $47 million Grid Resilience and Innovation Partnerships (GRIP) Program Grant from the federal Department of Energy.
"It's basically two-thirds of capital expenditures and community benefits that will be paid by the Department of Energy," said GRU CEO Ed Bielarski.
Bielarski said they expect the paperwork and negotiations to be finalized within 120 days.
"I think it's absolutely wonderful," said Angela Casteel, a Gainesville resident. "It's going to have enough impact because it'll be passed down to the customers."
The money aims to help customers pay bills, replace ten transformers and replace utility technology.
The public comment during this meeting mainly focused on the recent referendum passed in Tuesday's election. Three Gainesville residents spoke, and only one favored the new referendum, which passed with nearly 73% of the vote.
Casteel attends every monthly meeting and runs the Facebook group "Customers For A Better GRU!!!," a forum for expressing concerns. Casteel gathered signatures and worked to establish the GRU Authority Board, which now decides which motions are passed.
"I don't care how poor I am," said Casteel. "It's not about money for me. It's about my neighbors. It's about seeing that their bills are $500. I come here to advocate for them and find ways to save them money. Some people don't know how they will pay their bill next month. I don't come here for me. It's for other people."
