The Downtown Investment Authority Finance and Budget Committee signed off on the agency’s 2020-21 proposed budgets that include $250,000 for sale and design work on The Jacksonville Landing site.
DIA CEO Lori Boyer told the committee May 13 the money will pay for a brokerage firm to market the private parcels for development at 2 Independent Drive W. starting next fiscal year.
Past plans the city commissioned for the Landing property show a public space and parcels for private development on the 6-acre site.
The money also will be used to pay for design services.
Boyer said she hopes there is “carryover money” in the Northbank’s 2019-20 budget for additional Landing funds.
City Council approved $225,000 for a market analysis for the Landing property as part of the city’s 2019-20 budget. An additional $2 million was included in Curry’s five-year Capital Improvements Plan for fiscal years 2020-21 and 2021-22.
D.H. Griffin Wrecking Co. Inc. and subcontractor Crossbow Cattle Inc. are grading the Northbank riverfront site to sod the property in preparation for development. The contractor completed demolition this year of the two-story, 178,838-square-foot former shopping mall.
The DIA governs the Downtown Northbank and Southbank Community Redevelopment Areas, which are funded by tax increment districts that collect a percentage of the growth of property taxes. The DIA manages separate budgets for the Northbank and Southbank CRAs.
The committee approved DIA’s three budgets for fiscal 2020-21 totaling $16.02 million, flat from the current year.
• A $1.46 million administrative budget, including the $250,000 for the Landing.
• A $9.86 million Northbank CRA budget. That includes $5 million to cover expected revenue loss from Metropolitan Parking Solution-managed garages. The budget keeps $2.52 million unallocated on the Northbank.
• A $4.7 million budget for the Southbank CRA.
The DIA board, the Mayor’s Budget Review Committee and City Council must approve the budget before it takes effect. The board could consider the budget resolutions as early as its May 20 board meeting.
The budgets would take effect Oct. 1.
Boyer said she wants the Northbank budget to maintain “flexibility” to offer incentives to developers with unknown needs in the post-COVID-19 market.
MPS garage costs
The DIA manages the city’s contract with MPS awarded in March 2004 that provided three parcels of land to the company for $1 each to build and operate Downtown parking garages at the Duval County Courthouse, the VyStar Veterans Memorial Arena and the Sports Complex.
Committee Chair Todd Froats said he’s concerned that the city’s obligation to subsidize MPS revenue loss on its management of the garages is more than half of the Northbank’s proposed budget.
Boyer said the cost is impeding the DIA’s ability to offer incentives for more Downtown development projects. “It has had a serious impact on the Northbank tax increment district for many years,” she said.
She said the garage costs were not as noticeable to past boards because the city was lending money to the Northbank CRA when it had negative cash flow.
Boyer said the impact is clear now that the Northbank district fund is self-sustaining.
“The opportunity we would have with these funds to support other projects Downtown is a serious loss to us,” Boyer said.
Boyer said $500,000 from the unallocated funds might be necessary to cover MPS revenue loss next year. That depends on how quickly spectators are allowed to return to TIAA Bank Field and VyStar Memorial Arena and use the garages.
Froats said he wants the Finance and Budget Committee to discuss ways out of the MPS contracts at its June meeting.
DIA could use a $50,000 line-item in the DIA administrative budget to hire an independent auditor to track and verify MPS semiannual payment requests to the DIA.
Boyer said an outside auditor would help ensure MPS contract compliance.
She said as DIA receives more requested information from MPS about revenue and expenses, “it’s been becoming increasingly burdensome to review all of them and use our staff time for that,” Boyer said.
“It’s a big expenditure of the DIA, and we think it merits outside accounting services with specific expertise to be able to sample items in (payment) request and verify payments before we make them,” she said, referring to
Developer needs could changed
Boyer said the unallocated $2.52 million Northbank revenue could help the DIA adapt development incentives to market conditions created by COVID-19.
“We are a long way from Oct. 1 and we are even further away from next February and March, and my concern is that as we start to see how the recovery is progressing, different needs may become apparent to us,” Boyer said.
“The way we incentivize businesses and developers to reopen Downtown, to renovate buildings Downtown, may be different than what we know now,” she said.
The DIA could direct the unallocated money toward development loans, Downtown two-way street conversion or Boyer’s proposed Enhanced Food and Beverage Retail Enrichment program.
The budget assigns $15,000 to the DIA and Downtown Vision Inc.’s “Invest Jax” website that Boyer said will go live within 30 days of staff returning to city offices.
Boyer said it could target investors and developers seriously impacted by the virus in larger, more populous markets.
“This may be an opportunity where our lower density Downtown, compared to some urban areas, works to our benefit and becomes a selling point,” Boyer said.