City Council prepares to Halt Mobility Fee

[thelakelander]

This is definitely a great learning opportunity and case study for Jacksonville economics.  The positive to all of this is that council just kicked a hornet's nest.  We're going to find out real quick if this view towards job creation and our economic climate and sustainability actually works.  Best of all, the data produced won't be from Seattle, Austin, Houston, etc.  It will be from Jacksonville.  I can't wait to see the type of debate that will come a few months from now when a segment of the community starts to push extending the moratorium.

[Lunican]

The problem is that the criteria for success or failure is undefined.

Over the course of a year I'm sure a Wendy's will open, or a new KFC will pop up. When these things happen the council can proclaim success. It was already mentioned that a Wendy's brings 80 jobs.

[JeffreyS]

What a vision for Jacksonville that is.  If we just give our city away for free more of us can flip burgers.

[fieldafm]

The problem is that the criteria for success or failure is undefined.

Over the course of a year I'm sure a Wendy's will open, or a new KFC will pop up. When these things happen the council can proclaim success. It was already mentioned that a Wendy's brings 80 jobs.

What is HIGHLY disengenious about that argument is that the reality of the situation is that there is in fact financing available for high quality commercial deals.  The projects that don't have the proper financial footing to get financing, STILL won't get built... and the ones that were going to get built anyway will just now be built with a cheaper price tag to the developer.  It's a zero sum game.

It's just not true that a mobility fee would hold up construction.  If a franchisee couldn't construct a standalone fast food restaurant b/c of a $20,000 concurrency issue... they quite frankly can't afford to build anything. 

You would be amazed to know the amount of fast food and fast casual restaurants that opened in Jacksonville in 2010 and 2011... concurrency fees did not influence these openings in the least bit.

That is the reality on the financing side.  The rest is just political theory, which is very unproductive. 

What Lake is saying about combining local money with other matching grants should not be discounted.  Especially on transportation issues, local money is often met with outside multipliers.  In a city that is desperate to find new revenue sources, I can't understand the financial logic behind cutting income streams.

-Mike Field
registered Republican and fiscal conservative

[thelakelander]

The problem is that the criteria for success or failure is undefined.

Over the course of a year I'm sure a Wendy's will open, or a new KFC will pop up. When these things happen the council can proclaim success. It was already mentioned that a Wendy's brings 80 jobs.

You kill that by comparing Jax's (before and after moratorium) permit activity with other communities in the State and region.  If there isn't a significant uptick in Jax's numbers, say compared with Orlando, Savannah or St. Johns County's numbers over the next year, it would suggest the moratorium has no impact. 

Btw, I'm still LOLing over the Wendy's example.  Since when did Wendy's become the small guy?  I seriously doubt Wendy's is getting taken out by Jax's miniscule impact fees.  Perhaps, he would have made more sense going for something local like a Carmine's or City Kidz?  Nevertheless, they wouldn't pay anything by simply consuming some of the millions of square feet of commercial space that's already built and sitting vacant across the city.

[JeffreyS]

Even if there is an uptick does the Ad Valorum cover new infrastructure, schools and roads needed.  If it is a net negative it does not matter if there is more activity.

[Lunican]

Of course it's disingenuous. Whether the moratorium works or not is completely left to the discretion of each council member.

If you think it was easy to create this moratorium, watch how easy it will be to extend it.

[Ralph W]

One of the things I think politicians in general fail to realize is that the money to fund public projects is entirely different from private funding. Public funds are taxes collected and preallocated unless someone plays with the sand pile. Relating this to construction. If taxes are not collected and certain development goes forward, then the sand pile is insufficient and the whole allocation of funds formula is affected. Somewhere, someone will be shortchanged. Witness the current crunch in our small city as well as others across the nation.

Private funds are those controlled by profit seeking entities and ONLY allocated when the perceived benefit outweighs the costs. Developers with eyes on the bottom line will applaud one less fee not necessarily passing the savings along to the consumer. In addition, developers also realize that because of the previous construction boom and the current recession, there is no demand for ramping up major construction for the near future. Funding sources, such as banks or even venture capitalists, are also holding on to their cash.

These folks are not stupid. A moratorium on fees with the expectation that in itself will stimulate construction is pie in the sky thinking by the council. What happens at the end of the moratorium when development and construction is still stagnant due to lack of demand and the lack of private funding from gunshy developers and the banks that could - but won't - support them? Another moratorium? Or worse yet, a mistaken belief that public stimulation funds, another drain on the preallocated sand pile, will shake loose development leading right to the reestablishment of the mobility fee to attempt to fill up the hemorrhaging sand pile.

We've seen that playing catchup doesn't work. One of the most glaring examples of that is the police pension fund. As unsustainable as it always was and is, the failure of the city fathers to prefund (think mobility fees) has caused that fund to be further behind than it should be at this point. Although the people in charge should have been paying attention, because the principle of compound interest was at play here, they weren't and in the case of the mobility fee, are still not.

[fieldafm]

I seriously doubt Wendy's is getting taken out by Jax's miniscule impact fees.  Perhaps, he would have made more sense going for something local like a Carmine's or City Kidz?  Nevertheless, they wouldn't pay anything by simply consuming some of the millions of square feet of commercial space that's already built and sitting vacant across the city.

Exactly.  The example of the Wendys actually PROVES the opposition's point.  You can look at the ACTUAL numbers in relation to new fast food and fast casual restaurants opened in 2010 and 2011 to disprove this claim.  Jax is actually in the top 10 in the nation as far as new restaurant openings in these categories measured as a % of population.  Hell, there was a Jax Biz Journal article on the subject a few months ago.  The fact that council members charged with economic development apparently don't read even the Biz Journal is a sad commentary on the state of affairs in politics.

The reality of the situation does not support the other side's argument.  They just happen to be effective lobbyists. 

I am Mr Pro Growth.  My livelihood depends on this growth.  But as a fiscal conservative, the only growth that makes sense is high density growth that actually has a positive effect to the supply side of the revenue chain(the collection and spending of taxes).  That being side, when you look at real numbers... this moratorium doesn't add up.  Its a zero sum game in relation to new construction, and this game comes at the expense of the taxpayer.

Everyone in Council pledged to not raise taxes this past election.  What they have done is simply shift this burden from the end user(developer) to the taxpaying citizen.  If it smells like a tax increase and quacks like a tax increase, then City Council just passed a tax increase on their consituents.

If you think it was easy to create this moratorium, watch how easy it will be to extend it.

Doug made a great point a few days ago... it took two years of extensive public vetting with SUBSTANTIAL input from the development community to institute the Mobility Plan... and about 5 weeks and VIRTUALLY NO public input to effectively kill the plan... at least in the 'short term' :wink wink:

[Lunican]

The problem is that the criteria for success or failure is undefined.

Over the course of a year I'm sure a Wendy's will open, or a new KFC will pop up. When these things happen the council can proclaim success. It was already mentioned that a Wendy's brings 80 jobs.

You kill that by comparing Jax's (before and after moratorium) permit activity with other communities in the State and region.  If there isn't a significant uptick in Jax's numbers, say compared with Orlando, Savannah or St. Johns County's numbers over the next year, it would suggest the moratorium has no impact. 

Btw, I'm still LOLing over the Wendy's example.  Since when did Wendy's become the small guy?  I seriously doubt Wendy's is getting taken out by Jax's miniscule impact fees.  Perhaps, he would have made more sense going for something local like a Carmine's or City Kidz?  Nevertheless, they wouldn't pay anything by simply consuming some of the millions of square feet of commercial space that's already built and sitting vacant across the city.

I'm having trouble picturing a scenario in which something will be so different in one year that the council will reverse their stance when a bill is sponsored to continue the moratorium. What makes sense to them now will make just as much sense to them in a year.

[JeffreyS]

^Hopefully a year of us.

[thelakelander]

+1

[Lunican]

Let's hope so.

[thelakelander]

The other options are to do nothing or simply move.  We really have no choice.

[fsujax]

Stephen, I agree with you 100%! It is time for many of us on this board to run for Council.