Jacksonville Bold for 2.21.24: Lessons from a pension fund
Staff Reports posted: "Jacksonville Mayor Donna Deegan confirmed Friday that she's on board with an advanced proposal to borrow from pension fund assets for needed renovations on the Jaguars' stadium. A review of one pension fund suggests that the city's proposal to keep some "
A review of one pension fund suggests that the city's proposal to keep some financing from internal sources, which would give the pension funds a higher rate of investment return than bonds as Jacksonville pays back its obligation, could be viable.
For starters, the most recent draft copy of the Police and Fire Pension Fund's October 2022 actuarial valuation report (which helps to determine the employer contribution for the current fiscal year) suggests that the Fund's investments have been underperforming.
Donna Deegan is all-in for using the city's pension fund on stadium upgrades.
"Investment experience (on the net Actuarial Value of Assets) resulted in an experience loss (net of reserves) of about $37.5 million. The investment return on the smoothed Actuarial Value of Assets was 4.80% compared to the assumed annual investment return of 6.625%. (The net money-weighted investment return on the Market Value of Assets was -16.78%, as the Plan's investment consultant reported.) Investment gains and losses are spread over a five-year smoothing period, with gains and losses from prior years being smoothed into the current year."
Simply put, the plan's performance is roughly that found in today's high-yield savings accounts, and investment in the stadium could be guaranteed a stronger rate of return than what the Fund is seeing currently.
Another factor that the administration could use to argue for the stadium financing scheme is that the Police and Fire Pension Fund is less fully funded than the year before and is well below the 80% threshold historically understood as a best practice.
"This year's funded ratio is 45.97% compared to 48.06% last year," the report notes.
While some of that attrition is owed to accounting methodology changes, there is room for improvement. And some of that improvement could be tied to a more stable funding scheme than recent investments from the PFPF.
The city's chief negotiator, Mike Weinstein, has noted that the 1/2 cent sales tax currently allocated to Better Jacksonville Plan obligations is expected to be repurposed toward pension obligations in early 2027, consistent with the deal made to close the defined benefit pension plan last decade in exchange for a defined contribution plan and the expansion of the sales tax. Yet the Police and Fire Pension Fund worries that sales tax may not be the magic bullet to deal with the debt.
The report notes that "annual contributions to the Fund in fiscal years 2018 through 2030" are "significantly lower than the recommended contribution levels would be to ensure the Fund accumulates adequate assets to make all benefit payments (in the absence of the pension liability surtax)."
Moreover, the PFPF document notes that liabilities exceed assets and that "the Fund's assets are insufficient to cover the actuarial liabilities for inactive members. As of Oct. 1, 2022, the Market Value of Assets, net of reserves, is approximately $1.97 billion, and the actuarial liability for current inactive members is approximately $3.74 billion."
The question regarding the sale of this plan is: Will using assets to fund stadium work guarantee better returns and more solvency for both the Police and Fire Pension Fund and the General Employees' Pension Fund?
That's the case the administration will have to make to stakeholders, and one strong talking point rehearsed by Weinstein, who said the funding scheme would help the pension funds "close quicker."
Current expectations are that financial obligations for the plans closed in 2016 to new entrants are now slated to be fulfilled in 2061 and beating that timeline would benefit the city's bottom line.
The math might be with them, but if they are serious about going forward with this, they will need to start manufacturing consensus soon.
Scaled-down, for now
Deegan's Office offers more context about stadium negotiations, endorsing a bombshell declaration by her chief negotiator that the deal will be stripped down compared to the Jaguars' ambitious 2023 proposal.
"Yes, she is good with it," said representative Philip Perry regarding removing the stadium district component from negotiations.
Negotiator Weinstein said last week that the team and the city have "never had a serious conversation about the property" around the stadium, partly because it's in a federally designated Community Redevelopment Area (CRA).
Mike Weinstein says the city never had a serious conversation about the stadium district.
Perry affirmed this read, saying that going forward with components beyond the stadium would unduly complicate talks.
"Because the location is in a CRA, the city would need to competitively bid on the adjacent property, which would significantly complicate and delay the overall deal. It isn't realistic to include the development around the stadium right now and meet the necessary timeline for a deal. The Mayor does still want to create a sports and entertainment district, and we will explore that after the stadium deal is completed."
Fried to Jax
Nikki Fried, the Chair of the Florida Democratic Party, has long-standing ties to Duval County, where she will address the local party's Singleton Hazouri gala Saturday night.
The Duval County Democratic Party event honors two former Democratic titans: Mary Singleton, the first Black woman elected to the City Council in 1967, and former Mayor and City Council President Tommy Hazouri Sr.
Sen. Tracie Davis, Deegan and Council member Jimmy Peluso will also speak at Saturday's inaugural Singleton Hazouri Gala.
Nikki Fried is heading to town for a celebration of the Singleton Hazouri gala.
Davis was elected in 2022, defeating former Jacksonville City Council member Reggie Gaffney in an expensive, bitter Primary.
The two local officials were elected last year, of course. Deegan overcame financial disadvantages to become Mayor, and Peluso won the remapped District 7 that includes Riverside and Avondale, places he had run in when they were in District 14 before local redistricting.
Appropriately given Peluso's presence, Chair Fried lived in Riverside, an area now in the heart of his district and one key to winning the City Council election on his second try.
U.S. Reps. Aaron Bean and John Rutherford signed on to a Sen. Rick Scott letter taking issue with the Joe Biden administration over "the administration's pause in approving permits for liquefied natural gas (LNG) export projects, particularly as it pertains to the state of Florida."
"Florida plays a pivotal role in the broader landscape of U.S. LNG exports, and any decisions made in this regard will have a direct impact on our state's economy and security. We believe that a thorough consideration of Florida's unique circumstances and advantages is essential in shaping national policy on LNG exports. And further, a proper understanding and consideration of U.S. LNG exports on global energy markets and U.S. and allied interests is required before instituting such a shamefully transparent giveaway to radical climate activists," Scott's letter reads.
The communication also stresses the foreign policy ramifications of the pause.
LNG exports have a significant impact on the Florida economy.
"European nations would face the difficult choice of either depriving their citizens of energy or supporting Russia through energy dependence. Additionally, considering the recent increase in Russia's LNG exports and the geopolitical tensions in the Middle East threatening shipping lanes, maintaining a stable and secure supply of U.S. LNG is crucial for safeguarding the nation's energy security, providing global energy stability, and maintaining a stable domestic energy economy.
"Furthermore, as an energy exporting state, Florida's impact extends to Asia, where U.S. LNG has significantly contributed to the energy security of Japan, South Korea, Taiwan and India — to name a few. With these nations collectively accounting for one-fifth of U.S. LNG exports, it is evident that Florida's role transcends regional boundaries, making a substantial contribution to global energy stability and providing them with a superior alternative to reliance on adversaries such as Communist China for energy security."
Renner successor?
The House Speaker is term-limited, and the race to replace him in Tallahassee is on.
Among the contenders: Sam Greco.
Florida's Voice notes that he was "an active-duty judge advocate general in the U.S. Navy from 2019-2024, most recently at Naval Station Mayport in Jacksonville, and transitioned to the Navy Reserves."
Sam Greco is looking to succeed Paul Renner in the Florida House.
Now, he hopes to fill the shoes of Rep. Paul Renner, who moved to Palm Coast last decade after losing a competitive and expensive Primary to former Rep. Jay Fant by a handful of votes.
"If I'm elected to the statehouse, I will fight every day to make sure that we keep Florida free and that we keep this the best place," he said.
Diamond v. Dare
A Jacksonville City Council member who just returned from military service in the Middle East is raising concerns about an ongoing consulting contract of the Deegan administration.
At issue for Rory Diamond is the employment of Stephen Dare by Langton Consulting.
"Paying through a single-source contract and the way Mayor Deegan fought for it makes this confusing and dispiriting," Diamond contended.
Dare, whose legal name is William Stephen Griffin, backed Deegan in the 2023 campaign before working as part of her transition team and ending up with Langton.
Langton also backed Deegan during the campaign and got a $300,000 single-source contract from the new administration last year for federal grant writing, lobbying and policy development.
Deegan stands firm behind the city's consulting contract with Langton Consulting. Image via Donna Deegan Twitter/City of Jacksonville.
Even though the city does not directly employ Griffin, Diamond questions the ethics of the arrangement, which has found Griffin in meetings with senior staff for months.
He specifically takes issue with "why Mayor Deegan would bring someone with this criminal background into City Hall, provide them a badge, a cube and taxpayer money."
By that description, Diamond referred to several Griffin run-ins with the law and legal system over decades starting in the 1980s, including financial and comportment issues and other troubles under his real name, his Stephen Dare alt, and under another alias: "Spiff."
Asked whether the passage of time ameliorates these historic transgressions, Diamond raises concerns about the lack of a background check that a city employee would have gotten.
"People grow and change," he acknowledged, but they should be "run through the same process" as other employees are.
"Anybody who's got a badge ought to go through a background check," the Beaches Republican added.
Meanwhile, the Mayor's Office took a strong position.
"It's unfortunate the same forces that trade in punishment politics are once again engaging in a bad faith attempt to gin up non-existent controversies to distract from the substantial accomplishments of this administration. Furthermore, it's absurd to suggest that Langton was brought on as consultants to provide employment for one individual," Deegan said.
"Stephen is one of the most brilliant policy minds we have in Jacksonville and provided valuable insight during the campaign and in transition. Again, he is not an employee of the city. He works for Langton Consulting, and thus a background check was never needed. We have no idea what his salary is, nor is it any of our business what a private company is paying one of its employees," Deegan added.
(Invoices suggest the city is paying Langton $5,833.33 monthly for "policy creation.")
"This seems to be an attempt to needlessly drag someone's name through the mud with decades-old issues that have long been in the public domain. Perhaps the people who peddle this poison should remove the plank from their own eye before looking for the speck in their brother's," Deegan concluded.
Follow-up questions were rebuffed, with a spokesperson for the Mayor saying the administration was "moving on from this distraction."
Griffin did not answer phone calls from Florida Politics, reply to text messages to the last known number we had for him, or respond to a message sent on the X platform; meanwhile, we were frustrated in attempts to get his narrative perspective on this matter.
We understand Diamond is filing legislation that may tighten background checks. Stay tuned for that.
Shuttle diplomacy
The first autonomous vehicle shuttle service for a college campus in Florida was unveiled at Florida State College at Jacksonville (FSCJ).
The Jacksonville Transportation Authority (JTA) launched the shuttle service featuring the autonomous vehicle at the FSCJ downtown campus. It's the first autonomous shuttle carrying students and visitors for a Florida higher education school.
The shuttle vehicle, which can hold about a dozen passengers, is operated by an autonomous solutions company named Beep, based in Florida. It's coupled with software from Oxa, a company specializing in autonomous technology, which runs the self-driving vehicle.
FSCJ is hosting the first autonomous vehicle to serve a college campus.
The initial run of the autonomous shuttle is shuffling students, faculty, staff and visitors to FSCJ across its urban core campus with four buildings stretching about a mile in downtown Jacksonville.
JTA CEO Nat Ford said the FSJC autonomous shuttle foreshadows many more autonomous public transit vehicles coming to Jacksonville.
"We are eager for the FSCJ campus and wider Jacksonville community to experience these firsthand to see the benefits these vehicles bring," Ford said at a news conference and ceremony marking the initial use of the boxy autonomous vehicle Tuesday at FSCJ.
The initial run of the autonomous vehicle at the FSCJ campus is the first sample of plans for residents and autonomous vehicle expansion in Jacksonville's urban core. More vehicles are expected to be added in many downtown areas in 2025. There have also been indications that the Automated Skyway Express, which spans the St. Johns River through much of downtown, will have its monorail passenger cars replaced with automated vehicles.
Cruel irony
A Jacksonville crossing guard was fired from the Sheriff's Office for child abuse this week, notes WJXT, in the latest in an ongoing series of examples of cops gone wrong.
Theresa Mitchell had "been employed by JSO as a crossing guard since August 2020 but was fired following the arrest," noted reporter Francine Frazier.
When cops go wrong.
The Department of Children and Families launched the investigation, with JSO beginning its internal probe last Friday and announcing Mitchell's termination Wednesday.
Four flats
Tex-Mexit?
That's one way to frame recent news of the departure of four Tijuana Flats locations in Jacksonville.
As the Florida Times-Union's Teresa Stepzinski reports, "Tijuana Flats shuttered restaurants at 5635 San Jose Blvd. in Lakewood, 11700 San Jose Blvd. Unit 24 in Mandarin, 13820 Old St. Augustine Road in Bartram Park and 5907 Roosevelt Blvd. in Ortega Village."
Tijuana Flats suddenly closed its doors in Jacksonville.
Luckily, seven locations remain in the area.
The local joke for a long time was you couldn't cross the street without finding another taco or burrito stand. But it appears Jacksonville may be turning a corner and — at least regarding this durable chain — may have fewer options.
Nielsen rating
How much difference can a coordinator make?
That's the question to be determined, at least for the 2024 version of the Jacksonville Jaguars.
After a season that started surprisingly well for the Jacksonville defense, the team fired Mike Caldwell after a late-season collapse and replaced him with Ryan Nielsen.
The former Saints defensive coordinator started his first meeting with reporters, saying he wants his defense to be attacking and aggressive.
Nielsen lists former LSU head coach Ed Orgeron, Pete Carroll, Monte Kiffin, Norm Chow, and Alex Gibbs among his influences. Kiffin, who spent 2016 as a defensive assistant on Gus Bradley's staff, was known as a very aggressive defensive mind at both the NFL and college levels.
How much difference can DC Ryan Nielsen make? Image via AP.
Nielsen's first order of business will be to assess the defensive roster. That is mainly dependent on the Jaguars plans to bring Josh Allen back. The free agent-to-be set a franchise record for sacks in 2023. Assuming Allen is back, Nielsen must develop a scheme that maximizes Allen's impact while putting other players like Travon Walker in a position to affect the opposing quarterback.
"Here's our philosophy with the players, we're going to put the player in a position that he can have success first, over the scheme," Nielsen said. "We're going to evaluate everything that he does well, then if he can rush inside, we'll put him inside. If he's a better outside rusher, we'll keep him outside. We'll put our guys in the best positions for them to have success, and ultimately, we will have success on defense and as a team."
That seems like coaching 101, but many defensive coaches are comfortable with a specific type of scheme or defensive front, and they work to place the players into preconceived notions of what each position calls for.
If Nielsen can find a way to maximize Allen and Walker and to develop players like Devin Lloyd and Chad Muma, then the Jaguars will have a redefined defensive personality. If not, they'll need to add new faces to the roster in free agency to help.
Most notably, the defensive interior must be addressed. The Jaguars began the season as one of the top run defenses but fell apart in that category as the season progressed.
As for the pass defense, of course, it starts with the pass rush, but Nielsen brings a specific coverage philosophy to Jacksonville.
"Nothing cheap and nothing deep," Neilsen said. "When you're press (man-to-man), you take away the quick game and we like to play shell, which, when you look at us, we take away the deep throws. It may look man or man-ish at times, but sometimes there's press bail and some nuances in the coverage of that's actually a zone with tighter coverage on the outside. It's actually good that you see it like that because if we're viewed like that, then we drop into the zone, and it could be advantageous for us on defense."
Cornerbacks Tyson Campbell and Darius Williams have played at their best in man-to-man. Their ability to play a receiver tight is a benefit but may differ from the default approach Nielsen takes. In a division with young opposing quarterbacks C.J. Stroud (Houston Texans), Anthony Richardson (Indianapolis Colts), and Will Levis (Tennessee Titans), the ability to control the passing game is critical.
What should Jaguars fans expect from the defense in Nielsen's first year? An improvement from the second half of last season would be a start, but a more defined personality would go a long way to returning the Jaguars to the playoffs.
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