Commercial Real Estate, Capital, Insurance, Leasing & Management

After mayor’s office ‘mistakenly’ sweeps $4.6 million from DIA, Downtown advocates push back

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Mayor Lenny Curry's proposed budget takes $4.6 million tagged for Downtown redevelopment – a move the administration has called a "mistake," but one that nevertheless has Downtown advocates pushing back, including a Downtown property owner and a broker representing urban core properties.

Mayor Lenny Curry’s proposed budget takes $4.6 million tagged for Downtown redevelopment – a move the administration has called a “mistake,” but one that nevertheless has Downtown advocates pushing back, including a Downtown property owner and a broker representing urban core properties.

Jacksonville Chief Administrative Officer Sam Mousa quickly admitted the mistake at last week’s finance committee meeting on next year’s budget, acknowledging that by law the money can’t go into the general budget. Now, to balance the budget, the City Council will either have to waive the restriction on the money or fill the $4.6 million gap in some other way.

Still, the action perturbed some.

“It sends the wrong message,” said Mike Langton, who owns two buildings in Downtown and has been an advocate for the area for the past 16 years. “And the developer community responds very negatively to it.”

Langton said he is giving the mayor’s office the benefit of the doubt about the most recent faux pas, but wants the city to “do the right thing” and return the money for Downtown redevelopment. Langton said part of the problem with Downtown redevelopment efforts is that people are unsure about the area’s direction.

“We have to send a consistent, positive message about Downtown,” he said. “It has to come from everybody.”

That message has been an uneven one in the Curry administration, and it isn’t the first time Mousa is delivering the bad news. Many see it as a sign that the administration doesn’t prioritize Downtown, a narrative that the administration began when Mousa said there could be no additional funding for Downtown until pension reform went through.

“Without pension [reform], we just can’t do these projects. The best revenue source is to get pension done,” Mousa said at a Downtown Investment Authority meeting in January.

In an interview about Downtown in May, Curry reiterated that no investment could take place in Downtown until pension reform went through in an August 30 vote. He also declined to say what would happen with Downtown redevelopment if the referendum, which calls for half-cent sales tax increase, didn’t pass. Curry was also unavailable to talk when the Business Journal requested comment on Friday.

Now, some are concerned that Curry is taking some of the only money at Downtown redevelopment’s disposal off the table. Curry’s budget proposal, which is in the midst of being reviewed by City Council’s Finance Committee, swept the Downtown Investment Authority’s $4.6 million surplus fund into the general operating budget.

The money that was taken came from three taxing districts established in the 1980s. In those districts, a portion of property taxes are set aside to be used for improvements in the taxing districts.

DIA Chairman Jim Bailey said when the DIA was set up as its own authority in 2013, City Council passed an ordinance that the money would stay in the DIA budget. While the money wasn’t budgeted for use this year, Bailey said there are several projects on the cusp of needing the funding, including the Laura Street Trio, debt service and the JEA generator site on the Southbank.

For the money to go into the general operating budget, the City Council would need to waive a provision of an ordinance that prevented city leaders from removing the funds from the DIA, who had its balance build up over several years.

However, if they don’t waive the provision, Mousa proposed at the meeting taking the shortfall from the $78 million the city has in reserve funds, Bailey said.

City Council President Lori Boyer, who represents part of the Southbank, said she would like to see the money be used for Downtown redevelopment.

“I feel strongly about retaining it for Downtown development,” she said. “There are a lot of planned projects that we are in the middle of and working on, that I would like to see these funds available for.”

Franklin Street Managing Partner Carrie Smith said the actions of Curry’s administration leaves a “bad taste” in the mouths of those who are looking to invest in Downtown.

“It gives a sense that the administration doesn’t believe in Downtown and doesn’t want to invest in any developments in Downtown,” Smith said. “This is going to kill us down there.”

For those who have already made the move into Downtown, it can also be concerning,Smith said.

“I would think it wouldn’t sit well with any business owner in Downtown,” Smith said. “I think it would give a lot of business owners question.”

Overall, Smith said the lack of investment is having a chilling effect on Downtown’s momentum, something she said has been at its lowest point recently.

“I think for the past 18 to 24 months, it’s been the longest lull period in terms of businesses coming to Downtown and opening,” Smith said. “You had Chomp Chomp leave, Burro Bar close down and when you drive down there, there’s holes. So, to hear that our administration is pulling funds out, it’s very disconcerting.”

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