TAMPA — Mayor Bob Buckhorn pushes downtown redevelopment as a top priority for his administration, evangelizing about its capacity to lift the wider region economically and directing resources there to keep it moving.
Now his partner in the campaign, Hillsborough County, is saying enough.
For 30 years, the city and county have been plowing any increases in the tax revenues they collect on downtown properties back into downtown — specifically, to two districts known as community redevelopment areas.
By all accounts, this tax-increment financing or TIF has succeeded in keeping big money downtown — nearly two-thirds of the $19 million total to be collected this year alone in all eight of the city’s redevelopment districts.
Buckhorn said renewing the downtown TIF would continue to pay dividends, in part by keeping the cost of borrowing money low.
“This downtown TIF is important to me,” Buckhorn said Thursday.
But as the city and county discuss renewing the arrangement for another 30 years, County Administrator Mike Merrill says it’s time to spread the county’s 50-50 share of that wealth.
The county has funding problems of its own, Merrill said, and can use the swelling tax revenues generated downtown for creating its own economic development areas in unincorporated Hillsborough.
“Ideally it’s not going to be a case going forward where we continue to put 100 percent into the tax increment area,” Merrill said Thursday.
The downtown discussion comes as the city is about to create a ninth community redevelopment area, or CRA, on the west bank of the Hillsborough River and to extend two existing districts in Ybor City.
Merrill has no objection to contributing county money to these efforts, he said.
The new district, on 140 acres between Columbus Drive and Interstate 275, would get a mix of affordable and market-rate homes and would include commercial and retail uses. The exact boundaries will be worked out between the city and county before the district goes to the county commission in January or February, Merrill said.
“Creating the new one, that’s not a problem for us,” Merrill said. “It’s not going to generate a lot of tax increment dollars for quite awhile. And Ybor is probably not a problem.
“The two downtown areas are where the county would stand to lose a lot of revenue,” he added. “We’ve been sharing the county’s taxes in that area for 30 years. The question is how much we would continue to allocate and for how long.”
That question should be answered by early next year, Merrill said.
One consideration that would influence the county’s position is the prospect of a new stadium complex downtown for the Tampa Bay Rays. The team and Major League Baseball say they want out of their current home at Tropicana Field in St. Petersburg.
Merrill has suggested in the past that tax increment financing could be used to build roads, utilities and other groundwork for a new ballpark in lieu of a direct financial contribution to the team.
Buckhorn also has mentioned using tax increment dollars for a baseball stadium or perhaps for a mass transit project.
The mayor said he will try to persuade Merrill and other county officials to leave the TIF distribution as it is.
“I would be hopeful that the county would recognize the value of the TIF to the city and how important that is,” Buckhorn said. “If you dilute it, you’re only negating the maximum effect of the TIF district.”
The downtown discussion also comes as some civic and political leaders are questioning the mayor’s commitment to other areas of the city.
“The mayor needs to concentrate on investments and rebuilding foreclosed homes in other parts of town,” said Tampa City Councilman Frank Reddick. “The tax base in all those other communities outside of downtown are limited and aren’t generating revenue to be sustainable.”
The 11-year-old East Tampa CRA, which takes up most of Reddick’s district, is a case in point.
The district, the city’s largest geographically, was hit hard by the housing collapse and the foreclosure crisis that followed.
In 2010, three years after the crash, the district generated $4 million for local projects. Two years later, the revenues fell to just $31,000. And last year, the East Tampa district generated no tax revenue, according to the city’s most recent data.
Assessed property values there are 8 percent below their level when the district was created in 2003.
By comparison, the Channel District adjacent to downtown, created the same year, has seen property values increase seven-fold thanks to a residential construction boom. Last year, it generated $2.65 million in property taxes.
“East Tampa is at a tipping point,” said Chris Koury, who rehabilitates property in the V.M. Ybor neighborhood of East Tampa. “Without the TIF as fuel for the engine, there’s no growth there.”
Dianne Hart, president of the East Tampa Business and Civic Association, wants the city to direct more commercial development into the heart of the East Tampa CRA to boost the district’s tax base quickly. Commercial property isn’t subject to the tax deductions allowed for residential property.
“The real money will only come when we’re having commercial deals inside our area,” Hart said.
Hillsborough leaders are thinking along the same lines, hoping community redevelopment areas will spur economic development in the poorer areas of the county.
Merrill has proposed carving out four CRAs in unincorporated areas of the county: the University of South Florida neighborhood, Orient Road and the Florida State Fairgrounds, Ruskin-Wimauma and Brandon.
The county is also looking at a CRA in the Westshore business district, which is in the Tampa city limits. The Westshore Alliance, a business group, asked the county to consider the new redevelopment area.
“TIF funding can be leveraged and enhance economic redevelopment efforts,” Merrill said. “The statistics and history show that the way to reduce poverty and crime is to create jobs.”