The City Council’s Special Committee on the Future of Downtown is hindering the Downtown Investment Authority’s ability to work on projects, DIA CEO Lori Boyer said July 8.
The special committee was created by then-Council President Ron Salem in April to examine the DIA and elements involved in the progress of Downtown revitalization, which he described in a memo as “at best, debatable.” It has met twice, May 12 and June 10.
The committee could recommend changes to how DIA is funded and how it works with developers.
“The decision – and the current state of indecision – is having an effect on pipeline projects that could be excluded depending on where we target geographically,” Boyer said.
She cited the Gateway Jax development in Downtown two blocks south of Springfield and a potential project in the Brooklyn area which Boyer did not specifically identify.
Boyer was speaking at a DIA board of directors policy planning workshop. The purpose of the meeting was to discuss long-range budget, incentive and redevelopment priorities for Downtown.
“I have told my staff to tell developers that are coming to us now to hold,” Boyer said
She said it makes no sense to spend staff time if Council does not provide DIA with funds.
“I need to find out sooner rather than later if the faucet is turned off.”
The workshop also was for developing strategies for presentation to the council special committee that address general fund budgetary concerns and considering a suggestion to focus resources in a limited geographic area within the Northbank, Boyer wrote in a July 5 memo to board members.
“Getting a fixed amount from the City General Fund and limiting our geographic focus both are dramatic departures from our plan from when DIA was created in 2012. We have been market-driven and worked with developers on a project-by-project basis,” Boyer said to open the workshop.
Cyndy Trimmer, partner with Driver, McAfee, Hawthorne and Diebenow, a law firm that works with developers with projects Downtown underway and proposed, voiced concerns about potential changes.
“On behalf of a handful of folks, we are concerned about creating a system that puts projects into competition with each other and we are concerned about establishing arbitrary caps on incentives,” Trimmer said.
“We are concerned that new rules could chill development momentum,” she said.
Fixed amount
One potential change is that Council could appropriate a fixed amount each year that DIA could use for incentives beyond what is available annually to the authority through revenue from the Northbank and Southbank Tax Increment Districts, now about $15 million.
Boyer said the tax districts are generating what she called “discretionary revenue” over and above existing financial obligations and overhead. That revenue is used for the DIA’s facade and retail enhancement grants, matching loans for affordable housing and capital projects.
The money that may be appropriated from the city general fund in the future would cover completion grants that have been approved in the past few years to compensate developers for the increased costs of construction materials and interest rates, Boyer said.
“Needing general fund resources for completion grants puts strain on the city funding and the Council approval side,” Boyer said.
She proposed to the board that DIA continue to offer Recapture Enhanced Value Grants – a multiyear discount on property taxes generated by new construction.
Boyer said the discount schedule might be modified to provide a greater percentage discount in the years immediately after a project is completed and reducing the percentage in the later years of the discount.
“That’s something to consider as a tweak,” she said.
Small projects
Boyer encouraged the board to continue to support funding existing small project incentives such as the food and beverage district grants that encourage restaurant and lounge operators to open Downtown in specific focus areas.
For example, Boyer said the former Downtown Vision Inc. space and the Knott and Co. Jewelers spaces in the city-owned Ed Ball Building along Hogan Street are available and could be marketed to restaurant operators.
Knott and Co. closed in 2016 and DVI left in 2023.
“The negative about focus areas is it excludes projects in the next block and not all of the property owners in the focus area want to participate,” Boyer said.
No bonds
She recommended that the board decline to support using revenue from the tax districts to cover debt service on bonds issued to fund Downtown projects.
Boyer said Tampa and some other Florida cities have issued bonds for Downtown projects.
“We don’t need to borrow money to do capital projects,” she said.
Boyer described borrowing money and paying back principal and interest is “short-sighted” and would fund only one or two projects that would be paid for over a 20-year period.
She said it is her understanding that when the special committee meets, possibly July 22, the main discussion will be the city’s financial involvement in the possible redevelopment of the Laura Trio.
Boyer said she would like the board to determine how much money the authority will request from Council by the time the committee meets in mid-August.
Mayor Donna Deegan is scheduled to present the 2024-25 city budget to Council on July 15.
“When they start the budget process, we will have a better idea of what Council can afford. I need the board to figure out what number you need and what you want to focus on for development,” Boyer said.
The DIA Strategic Implementation Committee is scheduled to meet at 2 p.m. July 12 at the Main Library Downtown at 303 N. Laura St. or online at dia.coj.net/Meetings/DIA-Meetings