“The moment everybody’s been waiting for.”
With these words from Chair G. Alan Howard, the JEA board opened the conversation about the search for a replacement for CEO Paul McElroy, who abruptly resigned at a meeting to discuss his contract extension on April 6 after more than five years in that role. (Disclosure: My spouse is a JEA employee.) According to a spokesperson, in the two weeks since, McElroy has only used his badge to enter the building once, on Sunday, April 8.
JEA CFO Melissa Dykes had been thrust into the role of interim CEO following McElroy’s resignation and had since told board members that she wanted to continue on while it sought a permanent replacement. On Friday, JEA Board member Aaron Zahn, who joined that body in February, abruptly resigned and threw his hat into the ring.
Chief Human Resources Officer Angelia Hiers said that no one other than Zahn and Dykes had applied for the position; what went unsaid was that it was not advertised on JEA’s website, nor were any other efforts at recruitment mentioned.
Each had an opportunity to address the board before its vote.
Dykes stressed her more than two decades of experience in the utility industry and her nearly six years with JEA, which she said she chose to join “because I had an opportunity to work with great people.” She also spoke glowingly of the staff, some of whom had spoken in support of her being named interim CEO during public comment at today’s meeting.
Addressing the sale controversy, Dykes said that perhaps asking whether to sell or not wasn’t the right question, then somewhat cryptically suggested that there may be a “third option to loosen the reins on JEA” so it could diversify revenue streams.
Then it was Zahn’s turn. After saying that it hadn’t been an easy decision to depart from his personal and professional path thus far, Zahn brought up privatization, saying he’d “watched a public discourse around a crown jewel of our city become toxic and productive” in recent months. He said that one of his first orders of business would be communicating his desire to City Council and the mayor to halt the privatization conversation.
Zahn is the CEO of Pascal Partners, a Jax Beach company that bills itself as “a real estate and infrastructure company formed to acquire, own and manage a portfolio of real property interests and infrastructure,” and writes that its “Valued Partners are development and technology companies in the power generation, power storage, wireless communication, decentralized water and other distributed infrastructure industries.” According to the company website, from 2009-2017, Zahn was chairman and CEO of BCR Environmental Corporation, a company that helps municipalities monetize poop, or, as they put it, “convert organic waste streams into safe, valuable, and marketable end products.”
When the board asked both whether they’d apply for the permanent CEO position, Dykes demurred that she’d have to discuss it with her family; Zahn said he would apply if he were chosen for the interim role.
The board then opened the floor for votes. Three members—Husein Cumber, Kelly Flanagan and April Green, who attended via speakerphone from an airport—voted against Dykes, and Frederick Newbill and Howard voted for her. (The board currently has two vacancies.) The proceeding was over in minutes.
Many following the proceedings were somewhat surprised that the board then decided to implement a suggestion Zahn had made in his remarks, to change the current structure of executive leadership and elevate Dykes to a role akin to that of chief operating officer and give her a contract and a raise. Zahn had remarked that he felt the current structure was “almost too much for a CEO to navigate.”
With Zahn’s success looking to be a foregone conclusion, the board voted unanimously to offer him the position, with the terms of his contract to be worked out at a later date.
When the meeting adjourned, both he and Dykes beat a path to the door, while Howard fielded questions from media.
Privately, some are already wondering whether Zahn has the experience to effectively helm Jacksonville’s biggest asset, a multi-billion dollar utility with complex contracts and functions that are integral to the health, safety and security of the city. One observer dryly remarked, “Aaron Zahn’s utility experience is flipping the light switch.” But Howard seemed unconcerned when asked about Zahn’s qualifications, indicating that he has faith in their man. He also said that he supported Zahn’s suggestion to pause or halt the privatization conversation at present.
Others worry that Zahn is Mayor Lenny Curry’s guy; Zahn was chosen for the board by the mayor and he served on a subcomittee that advised the mayor on his transition into office in 2015. Many of the same people believe that Curry is behind the privatization push, which he has repeatedly denied.
Earlier in the meeting, after some debate, the board decided to hold off on enlisting ZRG Partners, with which JEA has an existing contract, to recruit a permanent CEO until it had time to decide on the qualifications it was seeking and learn more about the companies that were willing to take the job—’cause, as it turns out, not everyone was, thanks to the uncertainty created by the JEA sale drama, which kicked off in November when outgoing board member Tom Petway suggested the time may have come to sell.
Chief Human Resources Officer Angelia Hiers told the board that one company turned down the business entirely. “One of the few times in my life I’ve been rendered speechless,” she said. Although the position is very high-paying for the public sector—McElroy’s salary was $473,000 annually; the board had previously been prepared to offer him $520,000—other companies, Hiers said, cautioned that the chaos could prolong the search to up to a year, though most said six to eight months, or impede their ability to attract qualified candidates because the position could be short-term if city officials opt to privatize.
Hiers also sought guidance on whether the board was seeking a CEO for such a transition or someone with a long-term vision for JEA.
Howard said he felt they should search for a long-term candidate. “We need to hire a CEO who can take JEA forward into the future.”
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Correction: A previous version incorrectly spelled April Green’s last name.
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