Nobody said Downtown development was easy. And that’s an understatement.
Yet the Downtown Investment Authority board did a fine job Wednesday in balancing two goals:
• Develop the property once used by JEA’s Southside Generating Station as a catalyst for development.
• Protect the taxpayers to prevent the re-occurrence of previous disasters like the Shipyards.
Aundra Wallace, CEO of the Downtown Investment Authority, explained a complex financial plan for The District. Rather than sell the property to developers and leave the city vulnerable to another Shipyards fiasco, Wallace’s plan retains city ownership of the land, which would be turned over to the developers parcel by parcel.
The plan includes an additional property tax of 1.25 mills for the development that would be used to fund infrastructure improvements to the property — such as an extension of the Southbank Riverwalk.
JEA would turn over ownership of the land to the city and the Downtown Investment Authority. There would be about $45 million in public works invested in the city. The city would be obligated to contribute $26.4 million toward this.
The deal provides a series of performance benchmarks while giving maximum flexibility to the developers as market conditions change. The city would pay JEA in installments up to about $18.6 million till 2040.
This is a change from the original deal that called for developers to pay $18 million for total ownership of the property. But Wallace makes a convincing case that this arrangement better protects the taxpayers.
Tax increment financing has long been used to develop major areas. In fact, it has been used to finance the Miami World Center, the Kansas City Power &Light District and Atlantic Station Atlanta.
Noting this change in financing, some critics want JEA to rebid the project. But they’re overlooking the big idea.
As developer Peter Rummell explains, the District is based on a healthy living synergy that is built into the entire project. In addition, it’s designed to invite the public to visit with its riverfront park and a riverwalk that will surround the development.
Downtown Investment Authority board members were concerned that they were taking on all of the risks with the project — and there were some suggestions that JEA should assume its share of risk.
That was understandable.
But this is a big deal.
It is a $433 million development for Downtown.
And as board member Jack Meeks said, Jacksonville has done so little with so much for so long.
Approvals will still be needed by the JEA board and City Council.
But city leaders need to move forward with this project — while doing so with their eyes wide open.