A controversial bill (SB 1770) significantly restricting Community Redevelopment Agencies (CRAs), voted down 2-5 in the Senate Appropriations Subcommittee on Transportation, Tourism, and Economic Development after an hour-long hearing, was almost immediately revived by Committee Vice Chairman Bobby Powell (D-West Palm Beach).
Powell’s request to reconsider the bill met with no objections but was postponed for re-hearing. A similar bill in the House (HB 13) passed all its committees and is waiting to be heard by the full House.
CRAs are typically created by local governments to aid in the redevelopment of blighted areas.
Filed by Senator Tom Lee (R-Brandon), SB 1770 requires CRAs to be phased out unless reauthorized by a supermajority vote. New CRAs would also need to be created by supermajority vote. Lee’s bill was amended to define supermajority as 60 percent of a commission or council, so a commission of five would still only need three votes.
The House version requires reauthorization of a CRA by a majority-plus-one vote and does not allow any local government to create new CRAs. HB 13 states that only a special act of the Legislature may create a new CRA.
The bills also severely restrict the types of projects that may be funded through a CRA; allowing only administrative and planning expenses, purchase of real property, land clearing, relocation expense, bond repayment and bonding costs, development of affordable housing and community policing.
Currently, many CRAs throughout the state fund infrastructure improvements and economic development projects using the Tax Increment Funding (TIF) generated through CRA investment. TIF is generated when a property within a CRA increases in value, thus increasing the taxes that property pays annually. The difference between the original property tax amount and the new property tax amount is the tax increment.
During his presentation of the bill, Lee said that over the years there have been abuses in some CRAs. He referred several times to a Miami-Dade grand jury report released in 2016 that urged reforms of how the taxing districts are managed and suggested some were “slush funds” financing elected officials’ pet projects.
Lee said there should be assurances CRA funds are redirected into blighted areas and “that there are certain assurances that your constituents and mine have that that money is not being spent to build a pool on top of the Doubletree Hotel, which is what the CRA in Tallahassee is doing right now,” said Lee. “The things that are going on in some of these CRAs around the state are an absolute embarrassment to me as a public official.”
Later during public testimony, Michael Parker, director of housing and human services for the City of Tallahassee spoke on behalf of the Florida Redevelopment Association. During his remarks, he provided context to Lee’s reference about the Tallahassee CRA building a hotel pool. “The pool was not what that CRA paid for,” said Parker. He explained that the CRA paid $682,000 in 2014 as part of a $7.7 million public-private project. The CRA funds paid for sidewalks and streetscapes within the right-of-way with the public investment at 8 cents on the dollar. “It’s generating almost $90,000 in new taxable increment and that’s what’s being used to pay back the $682,000,” he said.
Parker also pointed out that there have been many very successful CRA projects, including Ybor City in Tampa, City Place in West Palm Beach and Pier Park in Panama City.
“There are no state funds in the CRA process. This is all done with local revenue generated at the local level. It is the primary tool that local governments use to access tax increment financing,” Parker said.
Most of those providing public comment agreed the that portions of the bill having to do with oversight, transparency and tightening up governance were worthwhile but that limiting the types of projects that could be funded using the CRA process was a major issue. “What the bill does is take what was intended to be an illustrative list and to make it an exclusive list. When it does that, it eliminates a host of things that I think anybody would agree are appropriate expenditures for a CRA,” said Bill Peebles, also speaking on behalf of the Florida Redevelopment Association.
Others speaking or weighing in in opposition to the bill included1000 Friends of Florida, the Florida League of Cities, the City of Lake Worth, Martin County and Redevelopment Management Associates.
“CRAs do everything from build sidewalks to enhance stormwater infrastructure, to put in parks, to putting in museums that are sources of community pride and an attraction for economic development. A list that prohibits those uses would not be in the best interests of Florida’s communities,” said Thomas Hawkins of 1000 Friends of Florida.
“Some of the testimony you heard today was from people that would have you believe that some of the investments they are doing are not going to be allowed in the future,” said Lee in his closing statement. “What I would say to you is that maybe they shouldn’t be allowed since the CRA statute wasn’t ever intended to build roads and things like that.”