City Council approves $30M gas tax loan to stop JTA ‘death spiral’

The Jacksonville Transportation Authority can borrow up to $30 million from the city’s local option gas tax revenue toward addressing its $39 million budget shortfall, the Jacksonville City Council voted Tuesday.

In a unanimous vote, the council passed emergency legislation to approve a no-interest loan for JTA to pay off debt and be able to adhere to its $139 million operating budget for the year. It will need to repay the city by 2037.

The concession by the council and the mayor’s office comes less than a month after JTA officials announced 194 layoffs, cuts and reductions in fixed-route bus services, and an upcoming pause to the Skyway elevated people mover and the NAVI autonomous shuttle service Downtown.

Ordinance 2026-0780 amends the city’s agreement with JTA, approved in 2021, that put the agency in charge of spending an estimated $479 million in local option gas tax dollars on transportation projects.

The city loan will, in part, be used to pay off a $20 million line of credit JTA obtained to pay its vendors.

JTA officials say, without paying off that debt, it would have to pay about $3 million in interest over the next two years. Instead, that interest cost can go toward paying down more debt or for operating expenses, the agency’s recently hired CFO Randall Barnes told council members last week.

Barnes said the budget issues originated from incorrect revenue projections, reduced ridership and fares that have not been increased since 2019.

The transit agency’s cuts will be coupled with a 25 cent base fare increase next year, from $1.75 to $2.

JTA interim CEO Cleveland Ferguson III, who was appointed to lead the agency Aug. 27 after the departure of 13-year CEO Nathaniel Ford, told Jacksonville Today last month that some of the gas-tax loan would also be used to fund severance payments for the laid-off employees.

Before the vote, council member Ron Salem called the $30 million “the beginning of a process” of stabilizing the agency. 

“We all support it. We really have no choice,” Salem said. “JTA is really — I hate to say in a death spiral — but when you’re borrowing money to pay bills, you’re in a death spiral.”

The Deegan administration helped negotiate the loan terms with JTA, and the mayor supports the move to provide JTA a financial lifeline.

Calls for accountability

Approving the loan comes amid questions about how JTA’s finances became so dire.

Council last week started investigating the answers by standing up a Financial Audit and Oversight Select Committee, led by members Chris Miller, Joe Carlucci and Salem. That’s being done in parallel to a criminal probe by the State Attorney General’s Office.

“With the help of our council auditors, we need to identify exactly what happened,” Salem said. “I think that’s extremely important to this community — when the numbers began to go South, who was in charge when it went South? Who put together the budget that was grossly inflated? We need to understand those issues.” 

Some city lawmakers have also been asking how much responsibility should be placed on Ford, who’s now leading the transit agency in Dallas, Texas.

Council member Rory Diamond was one of four city lawmakers who voted against increasing and extending the gas tax in 2021, meant to finance the autonomous vehicle project and about half of the 30-mile multipurpose Emerald Trail. 

After the Oct. 6 Finance Committee vote on the gas tax loan, Diamond said city lawmakers have no choice now than to authorize it.

“Today, we had to vote forward $30 million in local gas tax to help @JTAFLA pay down debt and stay operating,” Diamond posted on the X social media platform. “The situation at JTA is terrible. We have no other options. We must hold people accountable for this nightmare.”

Questioning JTA’s priorities: Emerald Trail and NAVI

The council’s oversight committee will hold its second meeting on Thursday, Oct. 15. Council auditors are set to give a presentation then on the “history of how JTA got to this financial position.”

The committee is eventually supposed to debate whether JTA’s list of projects meant to be completed with gas tax revenue should be reprioritized. 

The two most expensive items on that list are the NAVI shuttle expansion and the Emerald Trail. 

There’s been a bipartisan call on council for more than a year questioning the efficacy of the estimated $500 million-plus autonomous shuttle project. That call continued Tuesday night. 

Council member Jimmy Pelsuo, whose district includes Downtown, where NAVI operates on Bay Street, said the autonomous vehicles are costing taxpayers too much money and are “completely unnecessary.”

“The NAVI needs to die. It needs to go,” Peluso said. “…Good, reliable, efficient, quick transportation and transit should be the goal of JTA. Innovation should not. It’s not meant to be an incubator. It’s not meant to be an R and D (research and development) operator … at the level that it is.” 

At the same time, Howland is calling to scale back plans for the Emerald Trail and delay its neighborhood connections. Salem, who’s been a supporter of the trail, also said Tuesday that the select committee should take another look at the Emerald Trail.

Peluso pushed back, arguing the current 30-mile design through many neighborhoods is an economic driver for historically redlined communities along the trail.

“The Emerald Trail provides much needed investment and capital into these neighborhoods and connects them with the Downtown area, where we’ve invested a ton of cash in terms of parks and public amenities,” Peluso said. “We need to ensure these communities are able to get down here. … It’s been nothing but successful in the parts of the city it’s been open in.”

JTA service Impacts  

Hours before the Tuesday meeting, JTA released the list of the bus and shuttle routes that will be affected by the cuts starting Nov. 2. JTA says there will be no effects to the Connexion and Connexion Plus paratransit services. 

The agency is eliminating these four routes: 

• 18
• 25
• 32
• 18 

JTA says riders will see schedule changes for the following routes: 

• 1
• 3
• 4
• 8
• 10
• 11
• 12
• 13
• 14
• 16
• 19
• 22
• 23
• 24
• 27
• 28
• 30
• 31
• 32
• 53
• 81
• 105 (Orange Line)
• 202 (Mayport Express)

And one route was added

• Route 34

The vote: Ordinance 2026-0780

The Council’s vote Tuesday was 15-0, but there were several Council members absent. 

Council President Nick Howland was in London with other city officials for an annual economic development trip in conjunction with Jacksonville Jaguars games overseas. Diamond was on U.S. Army deployment for Hurricane Isaias recovery efforts. Council member Matt Carlucci was on vacation. 

Council member Kevin Carrico, who recently announced he would not seek reelection in 2027, was also absent.