Lori Boyer proposes Complete Overhaul of DIA Incentive Program

[Ken_FSU]

Haven't seen this mentioned here, but Lori Boyer made a pretty radical suggestion to overhaul DIA's funding of historical rehabs in downtown Jacksonville. Both JBJ articles, linked within, are behind a paywall. More details and quotes available for subscribers in the full stories.

Should the city pay millions of dollars to renovate downtown historic buildings?

https://www.bizjournals.com/jacksonville/news/2020/07/16/dia-historic-redevelopment-downtown-jacksonville.html

Incentive structures aimed at spurring the rehabilitation of downtown's historic buildings have failed, the Downtown Investment Authority board agreed Wednesday.

But DIA CEO Lori Boyer's proposed solution, which would greatly increase the amount of taxpayer money that goes to such projects, has some board members concerned.

Boyer's proposal, the Downtown Preservation and Revitalization Program, would replace entirely the DIA's current incentive program, the Historic Preservation and Revitalization Trust Fund, which was created in 2002. City Council will have to decide if the proposed program is put in place.

The existing 18-year-old program caps payouts at a $1 million per project and has strict limits on what expenses are eligible when considering grant amounts, a combination that Boyer said "made it inadequate to meet the needs of many of the properties downtown."...

Boyer's answer to "how to move the needle" on the rehabilitation of downtown's historic buildings is a four-pronged approach prepared by DIA staff in consultation with the city's Planning and Development Department. At its core, the program would have the city pay a far larger share of the gap between what redevelopment projects cost and what downtown rents earn.

Through four funding mechanisms, the DIA would be able to provide money for the rehabilitation of designated historic landmarks, for costs associated with code compliance, for the gap between project costs and market rent revenue and for small projects of $100,000 or less.

The mechanism have caps ranging from 20% to 40% of development costs, with only projects receiving less than $100,000 eligible for 40%. Each mechanism has its own eligibility criteria, and no project would receive funds from all four mechanisms.

All mechanisms increase the amount of dollars DIA can spend on costs associated with rehabilitating buildings under the 2002 legislation. In one of the mechanisms, the DIA could fund $3 of every $4 spent on the restoration of the exteriors of designated landmarks.

Only one mechanism, the Downtown Preservation and Revitalization Program Gap Loan, requires any repayment. The loan could provide up to 20% of the project's costs. It would be an interest-bearing loan that balloons in 10 years and would have to be repaid if the property was sold.

If a project were to receive funding from the proposed program, that would not prohibit it from getting funds from another DIA program. For example, a developer could get rehabilitation funds to redevelop a building, while a restaurateur could get money from DIA's Food and Beverage Retail Enhancement program for a restaurant build-out in the same building. The program is also distinct from newly created DIA incentives for historic facade renovations.

Boyer said there was no average payout when her staff modeled the program on various buildings downtown, but a payout on a large project could be as high as $12 million, she estimated. She credited Steve Kelley, DIA's director of downtown real estate and development, with concocting the recommended funding formulas...

Developers: Expect more downtown Jacksonville projects if new incentives pass

https://www.bizjournals.com/jacksonville/news/2020/07/20/downtown-jacksonville-developers-incentives-dia.html?iana=hpmvp_jac_news_headline
   
By Will Robinson  – Reporter, Jacksonville Business Journal

In last week's meeting of the Downtown Investment Authority, DIA CEO Lori Boyer proposed a complete overhaul of incentives meant to spur the redevelopment of downtown's vacant and deteriorating historic buildings. The program, which could have the city put $10 million or more into a single project, is what is needed to "move the needle" on downtown revitalization, Boyer argued.

The idea is not without controversy. DIA board members agree something needs to change, with board member Braxton Gillam saying during the meeting, "The current program is not working. ... We're going to continue to fail, so we've got to do something different if we want to succeed." But some, including Gillam, were wary of a massive increase in what the city spends on such projects.

Boyer's proposal must now go before City Council, which would have to agree to replace an 18-year-old program with the plan put forward by DIA.

Among those who hope City Council agrees with Boyer's assessment are several developers who told the Business Journal the new program could jumpstart projects in the urban core.

"This 100% moves the needle," said JWB Real Estate Capital President Alex Sifakis.

JWB purchased the 111-year-old Seminole Club building downtown in January and has shown interest in other historic sites downtown, including the 117-year-old Snyder Memorial building, the 96-year-old building at 218 Church St. and the 80-year-old building at 128 W. Adams St.

"This makes the numbers work," said Sifakis. "We haven't had this ability before. I think you'll see a lot of projects proposed because of this."

Some DIA board members balked at the increase in the amount of taxpayer money that could now be directed to these projects, but Sifakis argued that if making downtown more vibrant, walkable and culturally preserved is considered a city priority, then the city should be willing to put its money where its mouth is.

"If that's what we want as a city, then it takes money," he said.

Steve Atkins, managing director of SouthEast Development Group, heard his downtown projects mentioned on both sides of the DIA's discussion last week. His redevelopment of the Barnett building and the Laura Street Trio both received funds from the 2002-era Historic Preservation and Revitalization Trust Fund. The Barnett's $53 million conversion into apartments and offices has been hailed as a transformative win for downtown's urban core, but construction on the Trio across the street never got started.

Atkins told the Business Journal in an emailed statement that he was "very supportive of the new approach" the DIA proposed...

[fieldafm]

There was a front page article detailing the language of the bill in question:

https://www.thejaxsonmag.com/article/could-downtown-historic-preservation-be-a-game-changer/

[Ken_FSU]

Thanks Mike!

Totally missed it.

[thelakelander]

For anyone balking at the numbers, we're being asked to provide at least half of the $500 million for Lot J. If $250 million were put into bringing the core's vacant buildings back to life, like Charleston and Savannah, we could permanently end the decades long talk of trying to revitalizive downtown. Instead, we could then move on to doing things that kick urban core life, activity and economic development into overdrive. With that said, Sifakis is right. At some point you have to put your money where your mouth is. No matter how many chamber trips are taken, at the end of the day, that's a common element most places that have successfully turned it around, happen to have in common. Just look at today's main story. St. Pete just tossed $92 million into their pier. On the flip end, we're having a debate to the death on how to spend $600k at the county courthouse plaza. We're broken and need to be fixed.

[fieldafm]

For anyone balking at the numbers, we're being asked to provide at least half of the $500 million for Lot J.

Plus $25mm for Landing teardown, plus already North of $2mm for MetroPark shutdown (and counting), plus $14mm in City funds contributed to the Hart Bridge ramp teardowns.... all of which are borrowed funds.

[jaxlongtimer]

For anyone balking at the numbers, we're being asked to provide at least half of the $500 million for Lot J.

Plus $25mm for Landing teardown, plus already North of $2mm for MetroPark shutdown (and counting), plus $14mm in City funds contributed to the Hart Bridge ramp teardowns.... all of which are borrowed funds.

And millions more to tear down the old City Hall/Annex.  It's ironic that the City and State Attorney's office are in restored "historic" buildings while all the historic buildings in private hands continue to disappear.  You would think the decision makers would have a greater appreciation of historic buildings, accordingly.

[marcuscnelson]

For anyone balking at the numbers, we're being asked to provide at least half of the $500 million for Lot J.

Plus $25mm for Landing teardown, plus already North of $2mm for MetroPark shutdown (and counting), plus $14mm in City funds contributed to the Hart Bridge ramp teardowns.... all of which are borrowed funds.

And millions more to tear down the old City Hall/Annex.  It's ironic that the City and State Attorney's office are in restored "historic" buildings while all the historic buildings in private hands continue to disappear.  You would think the decision makers would have a greater appreciation of historic buildings, accordingly.

I've said it a few times on here, probably some others too, but it looks absolutely possible that by the time we fund Lot J, the rest of the Shipyards (because of course we will), the stadium improvements that the Jags will ask for, on top of all the other investments we'll essentially be making at their behest (and to the detriment of the rest of the city), we will probably have blown a billion dollars or more in public money to prop up one of the worst teams in the NFL.

[jaxlongtimer]

For anyone balking at the numbers, we're being asked to provide at least half of the $500 million for Lot J.

Plus $25mm for Landing teardown, plus already North of $2mm for MetroPark shutdown (and counting), plus $14mm in City funds contributed to the Hart Bridge ramp teardowns.... all of which are borrowed funds.

And millions more to tear down the old City Hall/Annex.  It's ironic that the City and State Attorney's office are in restored "historic" buildings while all the historic buildings in private hands continue to disappear.  You would think the decision makers would have a greater appreciation of historic buildings, accordingly.

I've said it a few times on here, probably some others too, but it looks absolutely possible that by the time we fund Lot J, the rest of the Shipyards (because of course we will), the stadium improvements that the Jags will ask for, on top of all the other investments we'll essentially be making at their behest (and to the detriment of the rest of the city), we will probably have blown a billion dollars or more in public money to prop up one of the worst teams in the NFL.

Agreed!  I actually tallied up Jag/Kahn related expenses and came up with the same billion or so, too, on another thread here a while ago.  If only the voting public was doing the same.

[marcuscnelson]

I've said it a few times on here, probably some others too, but it looks absolutely possible that by the time we fund Lot J, the rest of the Shipyards (because of course we will), the stadium improvements that the Jags will ask for, on top of all the other investments we'll essentially be making at their behest (and to the detriment of the rest of the city), we will probably have blown a billion dollars or more in public money to prop up one of the worst teams in the NFL.

Agreed!  I actually tallied up Jag/Kahn related expenses and came up with the same billion or so, too, on another thread here a while ago.  If only the voting public was doing the same.

I imagine because of the troubling question it presents. The Jags have been an enormous source of civic pride, and to some extent an elevation of our national visibility. But how much is that worth? How much are taxpayers willing to spend on civic pride? Ultimately, are we prepared to consider the possibility of letting the NFL go if it becomes economically unsustainable? Without answering that question - or without the willingness to answer it - we put ourselves at risk of being carte blanche for Khan. I don't know if Jacksonville voters are willing to answer that question right now.

[fieldafm]

For anyone balking at the numbers, we're being asked to provide at least half of the $500 million for Lot J.

Plus $25mm for Landing teardown, plus already North of $2mm for MetroPark shutdown (and counting), plus $14mm in City funds contributed to the Hart Bridge ramp teardowns.... all of which are borrowed funds.

And millions more to tear down the old City Hall/Annex.  It's ironic that the City and State Attorney's office are in restored "historic" buildings while all the historic buildings in private hands continue to disappear.  You would think the decision makers would have a greater appreciation of historic buildings, accordingly.

I didn't include the tear down of the old courthouse and City Hall buildings, as those teardowns had nothing to do with the redevelopment proposals in and around the stadium. 

[fieldafm]

I don't know if Jacksonville voters are willing to answer that question right now.

I'd wager good money that a referendum tied to stadium enhancements and a Khan-led, public private partnership redevelopment of Lot J/Shipyards would pass.

[Steve]

I don't know if Jacksonville voters are willing to answer that question right now.

I'd wager good money that a referendum tied to stadium enhancements and a Khan-led, public private partnership redevelopment of Lot J/Shipyards would pass.

Bingo - I'm not sure it would pass but it would be darn close. This is what COJ and the Jags missed in the first round of talks: They should have sandwiched them together. If they called it what it is, a Jaguars bailout, and tied stadium improvements to it as well as a lease extension and some sort of pause on going to the well for a while (that last part may be a reach), then I think it would be even more popular.

[downtownbrown]

This a wildcard year, and I don't mean Playoffs.  The Jags are going to bleed money this year because of Covid, and if there is a backlash against the prevailing political environment in and around the NFL, Jacksonville is the place for it.  It seems mighty incongruous to me to see 800 flag waving Trump supporters on the river downtown, while inside the stadium kneeling and other potential signs of activism become de rigueur.   The taxpayer appetite to bail out the Jags at any cost might just be waning.

[Ken_FSU]

For anyone balking at the numbers, we're being asked to provide at least half of the $500 million for Lot J.

Plus $25mm for Landing teardown, plus already North of $2mm for MetroPark shutdown (and counting), plus $14mm in City funds contributed to the Hart Bridge ramp teardowns.... all of which are borrowed funds.

And millions more to tear down the old City Hall/Annex.  It's ironic that the City and State Attorney's office are in restored "historic" buildings while all the historic buildings in private hands continue to disappear.  You would think the decision makers would have a greater appreciation of historic buildings, accordingly.

I've said it a few times on here, probably some others too, but it looks absolutely possible that by the time we fund Lot J, the rest of the Shipyards (because of course we will), the stadium improvements that the Jags will ask for, on top of all the other investments we'll essentially be making at their behest (and to the detriment of the rest of the city), we will probably have blown a billion dollars or more in public money to prop up one of the worst teams in the NFL.

Re: Lot J.

Cordish is also a bit of a wildcard here as well.

Would be interested to know if they're as willing to throw $125 million+ of their own money into Lot J as they were pre-covid.

[jaxlongtimer]

I don't know if Jacksonville voters are willing to answer that question right now.

I'd wager good money that a referendum tied to stadium enhancements and a Khan-led, public private partnership redevelopment of Lot J/Shipyards would pass.

Bingo - I'm not sure it would pass but it would be darn close. This is what COJ and the Jags missed in the first round of talks: They should have sandwiched them together. If they called it what it is, a Jaguars bailout, and tied stadium improvements to it as well as a lease extension and some sort of pause on going to the well for a while (that last part may be a reach), then I think it would be even more popular.

I am not so sure it would pass.  I know many people, from men and women "on the street" to current and former suite holders who are die hard Jags fans but are dead set against putting more taxpayer dollars in Khan's pocket.  I actually think a major City "donation" to Lot J, etc. could work against the Jags as this is a business proposition that is seen by many above and beyond the team, especially with the magnitude of the ask.  Also, there are some who, in comparing Khan's role in Jacksonville to Weaver, don't see the same level of commitment and remain somewhat cynical about Khan's ultimate loyalty to the City.

Add, in today's climate, given the lack of investment in low income areas vs. what Khan is asking for, and I imagine there would be some antipathy engendered there too.

Keep in mind, too, the many well heeled fans in St. Johns and Nassau Counties don't get a vote on this issue  .

Would be interesting to see a UNF poll on about Lot J/Metro Park/Shipyards and Khan.