On Tuesday, the full Jacksonville City Council approved an ambitious plan, one laden with incentives, put forth by two local power brokers, Peter Rummell and Michael Munz, who are seeking to develop a fallow Southbank property.
And that’s fine with Jacksonville Mayor Lenny Curry, who told media Tuesday the Council should pass the bill authorizing city incentives for the project.
That wasn’t fine, however, with his primary political nemesis: Council President Anna Brosche.
The bill had been workshopped for months, from the time the JEA board approved the land deal to a series of public notice meetings helmed by District Councilwoman Lori Boyer.
However, the Council President was not mollified, and pushed the matter to a spirited discussion ahead of a 9 to 5 vote in favor of the project.
Brosche had a major qualm: the lack of information on financial projections.
“I understand the city’s need to partner on economic development projects,” Brosche said, but a lack of financial projection information was a dealbreaker.
“How do we know the developer isn’t taking the city’s investment and making serious profit,” Brosche asked, wondering about the sharing of profits, or potential clawbacks.
“Transparency is what taxpayers expect,” Brosche said. “Without this information, I will not be able to support this project tonight.”
Brosche, soon enough, took some heat … both from allies and nemeses.
Councilman Reggie Gaffney backed the project in terms of downtown development, followed by Downtown Investment Authority CEO Aundra Wallace defending the mechanics of the deal “that puts all the risk on the private side and protects the public side, only investing in the public space and infrastructure.”
Councilman Bill Gulliford, no fan of Brosche’s, asked Wallace friendly questions, deriding the idea that “the developer could make some obscene profit” as they are “taking substantial risk.”
“I’m going to support the project,” Gulliford said.
Councilman Al Ferraro, meanwhile, backed Brosche.
“I’m hearing the President ask questions about a guarantee for investment, and I’m not hearing any answers,” Ferraro said, lamenting the possibility of “putting the taxpayers at risk.”
Wallace, a patient man by trade, explained to him that “public funds go into the public infrastructure and public space.”
It was up to Council President Aaron Bowman.
“This city has been dead for years … we need some cranes downtown,” Bowman said, lauding the proposed marina, shopping center, and public space as transformative.
“I hope the debate is over. Let’s vote yes and move forward,” Bowman said.
And indeed, the debate wrapped.
Opposed to the bill: Brosche, Dennis, Ferraro, Matt Schellenberg and Doyle Carter.
The District (2018-313) could, in theory, transform the Southbank with its radical redevelopment of 30 acres at the former Southside Generating Station property next to the Duval County School Board building, with an $82 million city investment between Rev Grants and city infrastructure investments.
Once this project gets going, it is expected to bring a new economic engine to an area with potential, per specs.
“The District will encompass approximately 200,000 square feet of retail space, 200,000 square feet of office space, 1,170 apartments/condominiums, and a 150-200 key hotel,” per a dedicated website to the project.
Politically connected developers Rummell and Munz have a deal via their Elements Development to buy the land for $18.6 million from the JEA Board. That deal closes July 18.
Among the incentives for developers: a $30 million capital improvement plan and a Rev Grant (75 percent for up to 22 years capped at $56 million).
The Rev Grant extends to 2040 when the Southbank CRA sunsets.
The total post-construction-assessed value is expected to be just shy of $216 million and is expected to generate $2.4 million in ad valorem taxes per year.
Capital improvements would include $25 million of infrastructure work, including three riverfront parks and a marshfront park on the south of the property ($4.469 million total, and these parks would be city lands).
Additionally, 20 percent of the work would be done by Jacksonville’s Small and Emerging Businesses.
The bill did not pass either committee of reference last week unanimously.
DIA Chair Wallace sparred with Councilman Matt Schellenberg about the interest rates the city was charging DIA to borrow the money (a condition negotiated between DIA and the Mayor’s Office), with a clearly fed-up Wallace noting that since DIA is a city authority, any rate hike would be imposed onto the city by itself.
Other project costs would include $6.361 million for a riverfront bulkhead, a $3.488 million Riverwalk extension, $1.597 million for a boardwalk, $1.035 for an overland trail. As well, a $1.025 million extension of Prudential Drive, $405,600 for Broadcast Place, and $1,158 million for Riverside Drive is in the mix.
The yet-to-be-created community development district will be responsible for creating 100 metered spaces for the public for Riverwalk and public park access.
Committee meetings last week had their intrigue, including Brosche peppering bill advocates with questions, presaging Tuesday’s drama.
Brosche had questions about the Southbank Community Redevelopment Area “footprint” from a public notice meeting with bill sponsor Lori Boyer last week, and wondered if the CRA still had conditions that permitted its continued existence, given the revenue in the area and a lack of blight.
Boyer noted that one function of a CRA could be to boost property value to fuel tax increment districts, and that she has resisted requests to extend the CRA.
“You may hear about that next term, and someone else may want to go there,” Boyer said.
But with “large parcels” available for development, there is still room to fulfill the CRA’s purpose, and that could happen in the next few years, she said.
Brosche also had questions for DIA head Aundra Wallace; the DIA Board approved this bill ahead of the City Council consideration.
Wallace and Brosche sparred on the question of whether the project’s financing and “commercial viability” should factor into whether Council should approve the deal.
“The proof is going to be the following. The CDD gets created and gets the bonds issued,” Wallace said.
“We’re protected … fundamentally sound in terms of protecting the taxpayer,” Wallace added.