Team,

I want to thank all of you for your dedicated support during our recent campaign. We made many new friends. We shall live to fight another day.

  

Robert Mounts

Active Citizen

 

 

 

On February 7, 2019, I formally announced my candidacy for Gainesville City Commissioner, District 4, as well as my three campaign goals. The election was March 19, 2019 and unfortunately, we lost.  However, these were, and still are, my goals:

  • First, change the culture of city governance;

  • Second, ensure fiscal responsibility as new projects are proposed; and

  • Third, faithfully "protect neighborhoods".  

You may watch the video of my announcement at the City Commission here:

  

My plan is summarized here:

Three Point Plan for Reform

Change the culture of city governance

More than a change of policy, this requires a change of attitude that will put residents and citizens first, especially in decisions impacting the place they live or work. Our elected officials work for the citizens, not the developers, not the staff.

As a private citizen, I will continue to work to ensure greater transparency in the decision-making process, consistent with Open Meeting and Sunshine laws, to include General Policy meetings, which are not televised, and one-on-one Commissioner meetings with Charter officers. The Commission needs to set a tone in public meetings that welcomes public comment before motions are put on the floor and Commissioners "telegraph" how they will vote.

Ensure fiscal responsibility as new projects are proposed

The Gainesville Sun recently acknowledged that GRU reserves are being rapidly depleted and that the GRU transfer must be reduced. This leaves the City with only three options: raise taxes, raise utility rates, or cut services. We are in this predicament because of the two incumbents' 2017 decision to acquire the biomass plant.

In my recent campaign, I asked voters to hold the incumbents running for reelection accountable.  However, the voters decided to reelect the incumbents and the chances of anyone being held "accountable" are slight.

 

A timely Jake Fuller cartoon reprinted in the Gainesville Sun, Editorial page, Sunday, February 10, 2019

 

This is what I said to the Commission in August 2017, prior to their first vote on the Asset Purchase Agreement:

 

 

 

Faithfully "protect neighborhoods"

The Gainesville Sun recently recognized that development decisions must be carried out in a way that protects the essential character of our historic neighborhoods.

While my former opponent has long promised this, he backed the GNV R.I.S.E. high-density infill plan sold to the public as a way to incentivize "affordable housing" (nearly to the end). Many of you knew it would destroy neighborhoods and benefit developers.

Seeking a “vibrant” downtown, he proposed an outdoor amphitheater at Depot Park (and backed off again in the face of opposition).

He also tried to eliminate limits on the frequency of loud, amplified music events that will make life miserable for nearby residents (then seeing massive opposition, backed off again and moved to"vote it down" and revamp the entire ordinance when challenged).

Last fall, I helped stop GNV R.I.S.E and pledged to work with all stakeholders to develop a serious comprehensive plan for affordable housing. I still firmly oppose making downtown Gainesville a full-blown party center at residents' expense.

Here is what I said about the noise ordinance on February 7, 2019 (and by the way, I misspoke as it was King Street, at Charleston, SC, my step-son and I visited, not "Charlotte":

 

*****

 

Although the incumbents have been returned to office, we all have reason to be extremely concerned that the city will not be able to afford new  spending, even to raise employee pay, or to incur more debt without serious consequences. 

I have over 45 years of public service to my state and country and have spent much of the past five years back home in Gainesville heavily engaged in public policy as an "active citizen". I will continue to stay engaged. Visit the "Issues" section to see the positive impact my common sense writings have made.

News

Thursday, June 6, 2019 1:19 PM

TV20 Calls it a Double Whammy


Thursday, June 6, 2019 1:07 PM

Time for a Taxpayer Revolt?

You had to know this was coming.  Yesterday, the City Commission voted 4-3 (with Commissioners Johnson, Ward, and Simmons dissenting) to significantly raise GRU rates and property taxes, as necessary due to their past mistakes to service the GRU debt related to the 2017 purchase of the biomass plant. Two more votes are required later this summer to make this final. Time for a taxpayer revolt?


Saturday, May 4, 2019 1:38 PM

Looming Property Tax, Utility Rate Increases

Kind of like, "well, we told you so". Thinking about whether this is the time for another Op-Ed reminding them how and why we got into this mess. I may write something this week. Still remember that revealing little box in the GRU paper that said how much it will take to service the debt over the next few years, jumping up big time in the sixth year, as I recall.


Glad Andrew Caplan is reporting on this. No mention of the cause, though.






Friday, April 26, 2019 10:15 AM

Donation of Excess Campaign Funds to Gainesville Fisher House Foundation, Inc.

Our Treasurer, Diane Hurtak, and I just filed our final Campaign Finance Report with the Clerk of the Commission (early, well before the 90 day deadline). Balanced to the penny, we had a very credible and efficient campaign, raising more than $10,000.00 in a very short time, which quickly supplemented my initial "jump-start" contribution of $3,000.00. We spent most of it wisely and had $894.35 remaining after all obligations were satisfied. I have donated that amount to charity and have closed the campaign account as provided by the election law. The beneficiary is the Gainesville Fisher House Foundation, Inc., a 501(c)(3) charitable foundation that supports the Gainesville Fisher House, one of the best such facilities in the nation. For more regarding the local Fisher House, go to this link:


https://www.gainesvillefisherhouse.org/



I want to thank Diane again for making this effort possible. Without her, I would not have attempted such a task. I am also very grateful to Melanie Shore of the Ameris Bank, 7000 SW Archer Road, Gainesville, for her invaluable personal assistance in establishing and properly managing the account.


I thank all of you again from the bottom of my heart for your hard work and dedication.


For now at least, my website (robertmounts.com) will stay active as a personal website and may be updated from time to time. It is one way of staying in the fight.


Sunday, March 17, 2019 8:24 PM

Fitch Downgrades GRU $1.5 billion credit rating

Fitch Ratings Downgrades $1.5 Billion of GRU Outstanding Debt; Very High Leverage Cited as Basis for Fitch Downgrade; GRU Management Fails to Disclose
Fitch Downgrade in Response to a Direct Question During Televised UAB Meeting

GAINESVILLE, FL., March 16, 2019 – Former Florida Public Service Commissioner and GRU customer
Nathan A, Skop issued the following statement regarding the Fitch downgrade of Gainesville Regional
Utilities (“GRU”) related utility system revenue bonds; the Fitch basis for the downgrade; the failure of GRU
management to affirmatively disclose the Fitch downgrade (i.e., material omission) in response to a direct
question from Mr. Skop during a televised Utility Advisory Board (“UAB”) meeting; the inconsistencies contained within the GRU management discussion of the Fitch downgrade; and the potential adverse financial impact of the Fitch downgrade on GRU customers.
Fitch Downgrade of GRU Related Debt
On March 13, 2019, Fitch Ratings downgraded approximately $1.5 billion of outstanding utility system
revenue bonds related to GRU. A true and correct copy of the Fitch Rating report is attached herein as
Enclosure 1 (omitted for brevity). The downgrade of the outstanding utility system revenue bonds to ‘A+’ from ‘AA-‘ mirrored the ‘A+’ rating that Fitch assigned to the 2019 Series A bonds ($159 million), 2019 Series B bonds ($27 million), and 2019 Series C bonds ($68 million) scheduled for issuance by the city of Gainesville, FL. The
Gainesville City Commission is expected to vote to approve the 2019 Series C bond issuance during the regular City Commission meeting on March 21, 2019.

 

As of the date of this press release, the City of Gainesville has not posted the Agenda for the City Commission meeting on March 21, 2019.

Accordingly, the general public remains in the dark about the Fitch downgrade and the details surrounding the controversial and ill-advised 2019 Series C debt refinancing scheme which has been opposed by numerous
GRU customers, the UAB Chairwoman, and the UAB Vice Chair. 2019 Series C Bond Issuance Instead of paying off existing debt and retiring it as it reaches maturity (2019-2025) over the next few years, the proposed 2019 Series C bond transaction seeks to refinance $68 million of debt for another 30 years by issuing variable interest rate bonds in a rising interest rate environment at a greater total borrowing cost to GRU customers. Refinancing the $68 million in debt will cost GRU customers at least $114 million over the next 30 years (nearly double the amount of debt being refinanced). The proposed transaction reduces debt service obligations in the near term at a greater total borrowing cost to GRU customers. Despite the
Fitch downgrade, GRU is kicking the growing can of debt further down the road at great total borrowing cost to GRU customers. The proposed 2019 Series C debt refinancing scheme (in the wake of the 2012 debt restructuring scheme used to hide the true rate impact of the biomass contract) is another bad deal for GRU customers. “Taking GRU even deeper into debt to fund the General Fund Transfer (“GFT”) is fiscally irresponsible”, said Mr. Skop. If the GFT is reduced as proposed by GRU, there is absolutely no reason whatsoever to take GRU even deeper into debt as evidenced by the Fitch downgrade of GRU related debt due to very high leverage. GRU customers should oppose this ill-advised debt restructuring scheme which is coming before the Gainesville City Commission for approval on March 21, 2019.
Fitch Basis for Downgrade As expressly stated in the Fitch Ratings report dated March 13, 2019, very high leverage was the Fitch basis for downgrading the GRU related debt:
‘VERY HIGH LEVERAGE BASIS FOR DOWNGRADE”
“Despite a gradual decline in total debt over the past few years, GRU's leverage profile is very high and a main credit
weakness for the utility. As of fiscal-end 2018, GRU had about $1.6 billion of total debt outstanding and $93 million of outstanding commercial paper. A portion of the 2019 bond proceeds will be used to repay outstanding CP with long term debt, leaving total debt outstanding relatively unchanged.
Nevertheless, leverage, as measured by net adjusted debt to adjusted FADS, has been elevated for many years before rising to a very high 11.0x in fiscal 2018.”

GRU Management Failed to Disclose Downgrade in Response to Direct Question
During the UAB meeting held March 14, 2019, former state utility regulator Skop asked GRU management
a direct question relating to the proposed 2019 Series C bonds. Specifically, Mr. Skop asked,
“Mr. Bielarski, with respect to the staff recommendation for the proposed Series C 2019 issuance,
can you affirmatively guarantee that if GRU moves forward with this, that GRU debt or credit will
NOT be downgraded. Yes or No?”
Reference: UAB meeting video at 2:00:24 to 2:03:02:
http://www.cityofgainesville.org/CommunicationsOffice/Community12TV/UtilityAdvisoryBoardVideos.aspx

See also:
Just say NO! (UAB meeting video at 2:50:00 to 2:53:15)
Kicking the Can of Debt Down the Road (UAB meeting video at 56:30 to 58:00)
Despite having ACTUAL knowledge that Fitch downgraded GRU related debt on March 13, 2019, GRU management failed to disclose the Fitch downgrade in response to the direct question asked by Mr. Skop. The material omission by GRU was also NOT corrected by the UAB Chairwoman who had ACTUAL
knowledge of the Fitch downgrade.
This assertion is clearly supported by the attached public records. On March 14, 2019, GRU (Bielarski)
sent an email to the Gainesville City Commission and UAB members regarding the Fitch downgrade at
10:01:07 AM (prior to the UAB meeting at 5:30 pm). A true and correct copy of the GRU e-mail is attached
herein as Exhibit A. The UAB Chairwoman subsequently forwarded the GRU email relating to the Fitch
downgrade to her Gmail account at 11:49:47 AM. A true and correct copy of the GRU e-mail that was forwarded to the Gmail account is attached herein as Exhibit B. The general public (including myself) had absolutely NO knowledge of the Fitch downgrade e-mail until AFTER the UAB meeting, because the Commission and UAB e-mail is NOT posted on the Commission website until after 11 pm on any specific day. Accordingly, GRU management knowingly failed to disclose and concealed the Fitch downgrade in response to the direct question asked by Mr. Skop. The UAB Chairwoman also failed to correct the material
omission made by GRU management (Bielarski, Resnick).

As of the date of this press release, the general public remains in the dark about the Fitch downgrade necessitating the issuance of this press release to illustrate how GRU management knowingly failed to
disclose and concealed the Fitch downgrade in response to the direct question asked by Mr. Skop at the
UAB meeting.
Inconsistencies in GRU Management Discussion of Fitch Downgrade
Exhibit A (omitted here) provides the GRU management discussion of the reason for the Fitch downgrade. The Fitch report expressly stated that the basis for the downgrade was “VERY HIGH LEVERAGE BASIS FOR
DOWNGRADE”. GRU management, however, attributes the downgrade to a change in Fitch rating criteria.

The Fitch report is completely devoid of any mention that the downgrade resulted from a change in the
Fitch rating criteria. In response to a prior representation made to the Gainesville City Commission by GRU
management and PFM related to a utility downgraded under the alleged rating criteria change, GRU and
PFM, despite two public records requests, could not provide the name of the utility to support their assertion.
Accordingly, the GRU explanation of the downgrade is NOT supported by the content of the Fitch report.
Based upon the above, local media should provide Fitch Ratings with copy of the GRU management e-mail
attached herein as Exhibit A to fact check this inconsistency and determine whether Fitch agrees with Mr.
Bielarski’s assertion that the downgrade resulted from an actual change to the Fitch rating criteria as
opposed to GRU being taken even deeper into debt despite already being very highly leveraged.

GRU management also attempts to downplay the significance of Fitch downgrade within the Exhibit A
discussion noting that S&P and Moody’s affirmed 2019 Series A and 2019 Series B bond issuance. The KEY difference not mentioned by GRU management, however, is that Fitch actually rated the 2019 Series A, 2019 Series B, and the 2019 Series C bonds (assigning the same ‘A+’ ratings as the downgraded GRU debt) while S&P and Moody’s did NOT rate the proposed 2019 Series C bond issuance.
Potential Adverse Financial Impact of Fitch Downgrade on GRU Customers
GRU management and the Gainesville City Commission have routinely stated that a downgrade would cost GRU customers millions of dollars of additional borrowing cost each year. In 2012, GRU management and the Gainesville City Commission expressed concern over the financial impact of a downgrade claiming that
GRU had saved $64 million in interest rates over the last decade because of GRU’s then higher creditratings. Since 2012, GRU has been downgraded at least three times while nearly doubling the amount of outstanding debt. Undoubtedly, the Gainesville City Commission will now conveniently claim that the Fitch downgrade doesn’t matter as they take GRU even deeper into debt to siphon more money out of the utility
irrespective of the financial harm to GRU and its customers. Ironically, the Gainesville City Commission is quick to raise GRU rates but refuses to give up their catered meals at taxpayer expense and govern in a fiscally responsible manner. “The problem is not GRU’, Skop added, “but rather the mismanagement of
our municipal utility at the hands of the City politicians”.
# # #
Contact:
Nathan A. Skop, Esq.
Former Commissioner
Florida Public Service Commission
Phone: (352) 363-1455
E-mail: n_skop@hotmail.com

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