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More Hurdles For Blighted Areas

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By JOHN W. ALLMAN, The Tampa Tribune

Published: February 24, 2008

Updated: 02/23/2008 11:55 pm

TAMPA - There should be a flurry of activity on Nebraska Avenue at the former Central Park Village public housing site.

But a ruling in September by the state Supreme Court has stymied plans to build a new housing community, called Encore, and revitalize the surrounding neighborhood, which was deemed blighted.

A second, more serious threat to the project, and others like it, will be discussed in March when the Legislature convenes.

For now, mounds of dirt and rubble sit where apartments once were, and a chain-link fence keeps out passers-by.

The high court's ruling on the legality of public dollars being used without a public vote jeopardizes financing for the 143-acre Central Park project.

It also casts doubt on the future of Tampa's eight other Community Redevelopment Areas, including such high-profile locations as downtown, the Channel District and the Tampa Heights Riverfront development.

Such areas create a special taxing district - the core of the Supreme Court's ruling - which allows a portion of property taxes raised to be spent on infrastructure improvements.

None is more affected than Central Park. In addition to affordable and market-rate housing, proposals called for a grocery store, a possible hotel, a refurbished public park and more.

And that's just the housing site. The surrounding neighborhood, currently a mix of income-based apartments, churches, fast-food franchises and locally owned stores, stands to receive a significant facelift.

Officials hoped Encore's development would be a catalyst to encourage other developers to get involved.

"There's no buzz I can go share with anybody," said Michael Hatchett, the city's urban development manager responsible for the Central Park CRA. "It just creates that delay in being able to take advantage of momentum that otherwise would have been there."

Justices are reviewing their decision. Officials are hopeful that the final ruling will exempt CRAs, but that decision could be months away.

In March, state lawmakers will consider a bill that could hinder future revitalization.

Sen. Ronda Storms, R-Brandon, is introducing legislation that specifies a 15-year lifespan for new CRAs. It also would force existing CRAs 15 years or older to dissolve by July 2009.

Storms did not respond to a request for comment about Senate Bill 1528.

In Florida, most CRAs last 20 to 30 years. That's because, typically, cities designate a blighted district for tax-increment financing, which means any increase in assessments over a base amount are plowed back into the area for redevelopment. Over 20 or 30 years, tax-increment financing values increase as needed to pay off debt.

Central Park, for example, would use TIF funds to back bonds to pay for at least $25 million in streets, stormwater and sewer systems, plus improvements to Perry Harvey Sr. Park and other infrastructure.

"I'm feeling the squeeze," said Carol Westmoreland, executive director of the Florida Redevelopment Association, a not-for-profit agency that assists and promotes 141 of the 148 active redevelopment areas statewide. "We're trying to preserve something that is very good, that is very essential, to have good-looking areas and not have blight."

The Problem

Much of the state's CRA dilemma can be traced to a nearly two-year-old court fight in Escambia County.

It began in May 2006 when Pensacola veterinarian Gregory L. Strand took his battle with county commissioners to the Supreme Court. Escambia County officials had agreed to use tax-increment financing to fund a $135 million improvement project in Perdido Key.

Strand's case argued that the county's decision to use TIF money to pay for that project circumvented the public's right to a vote.

The high court agreed, ruling that local governments have to seek voters' blessing before issuing bonds backed by taxpayer money. The court later revised its decision to exempt debt that was established before the Strand decision.

Even with the revision, most lenders were left uneasy and unsure.

In downtown Tampa, officials looked at other options besides bonds to secure $40 million in financing to begin work on improvements. The projects include converting one-way streets to two-way streets, hiring a consultant to redesign Zack Street into an Avenue of the Arts, refurbishing Herman Massey Park at Franklin Street and redesigning Curtis Hixon Park.

Curtis Hixon Park, in particular, is integral to the creation of a new art museum. Plans call for the waterfront park to become a destination spot for large, outdoor events with a restaurant and other amenities.

"This was a centerpiece park for the entire city," said Michael Chen, the city's manager of the Downtown CRA.

The financing was not certified before the court's initial ruling, however. And too many questions remained in light of the high court's review of the case.

The bank, Chen said, "didn't want to take a chance of funding against something to test what the Supreme Court meant."

Across Ashley Drive from the park and the proposed museum is Skypoint, a new art-deco condominium, which opened in late 2007.

"Since living here, I did learn they're trying to revitalize the area," said Kevin Davis, a 31-year-old Tampa lawyer, who moved there in October. "Now I'm concerned about a roadblock."

Projects In Trouble

With challenges coming not only from the state's high court but also a state senator, redevelopment advocates say revitalization projects are endangered.

"Some of our areas that are not redeveloped right now may not be redeveloped because of lack of funding. In Central Park, that would be a real shame," Westmoreland said. "This is what public dollars are meant to do, to be leveraged to make an investment in these communities, a long-term investment."

Westmoreland said very few redevelopment projects are moving forward statewide.

"They're doing the planning aspects, anything they can that doesn't involve financing," she said.

The most pressing concern is time.

Investors get spooked. Construction prices increase. TIF accounts that have yet to be created can't increase in value.

"The sooner this can get online, it shouts out to investors and the development community that this is a good place to be," Hatchett said recently, walking Nebraska Avenue near the quiet, enclosed Central Park Village site.

"We'd be building roads and water and the infrastructure right about now if not for the Strand decision."

Reporter John W. Allman can be reached at jallman@tampatrib.com or (813) 259-7915.

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