By Casey Barr
As discussed in a previous blog post, Community Redevelopment Agencies (CRAs) are a form of special district government that funds local redevelopment projects with taxpayer subsidies. But how are spending and organizational decisions made in a CRA?
(Source: City of Tallahassee. Available at: https://www.talgov.com/cra/CRAHome.aspx)
CRAs can only be established when two governmental units, such as the City of Tallahassee and Leon County, come together to construct an interlocal agreement. In order to declare that a particular part of the city is fit for redevelopment, the CRA must first survey the area in question and construct a “finding of necessity.” The finding of necessity documents all sources of “blight” or “slum” when surveying a prospective area for redevelopment. A slum can be thought of as of an area characterized by decrepit human conditions, while an area is blighted mostly due to the condition of its real estate. Ideally, the CRA’s spending programs should reflect the needs cited in the finding of necessity. However, a 2009 Policy report on CRAs in Florida by Heather Khan for the DeVoe Moore Center found a “deep disconnect between the slum and blight conditions cited in the blight study [also called the “finding of necessity”] and the content of the redevelopment plan.”
After the local governments establish a CRA, they draft a Community Redevelopment Plan and establish a trust fund for the CRA to spend as its board members see fit. A CRA board must be composed of 5 to 9 commissioners – Tallahassee’s currently has 9 – all of whom are elected officials in county or city government. These positions are unpaid, though commissioners are reimbursed for any travel expenses related to the job. The CRA makes decisions on a wide array of issues, such as apportioning money for use as business grants, issuing revenue bonds for a particular redevelopment activity, and modifying the Community Redevelopment Plan.
Which redevelopment projects ultimately receive funding? The choosing, planning, and subsequent funding of redevelopment projects are solely the responsibility of the CRA board. In hopes of securing grants to assist with project funding, business owners, community leaders, and developers deliver presentations highlighting the number of jobs a particular business might bring or the amount of taxable revenue it is projected to generate. Each commissioner gets a single vote per project, cast at CRA board meetings held in the City Commission chambers at City Hall.
One project that found consensus with the Tallahassee CRA board was the sale of 715 West Gaines Street, which was sold by the CRA to developers North American Properties for $788,000 ($18,000 more than the initial offer).The Tallahassee CRA originally obtained the property in a land swap deal with the Florida State University in 2014 in exchange for a 5-acre parcel of land that the university plans to use to construct a new building for the College of Business. North American Properties, however, plans to use their newly acquired land to build more student housing and retail space, as well as potentially opening a grocery store. North American Properties will not request CRA funds to fund the development of the property, instead relying on private investment and financing.
Not every decision is met with unanimity, however. Commissioners disagreed on whether to add new areas to the CRA earlier this year. In another case in March 2015, board members voted 5-3 to keep discussion open on a business magnet program that would relocate existing businesses to areas within a CRA district. Moving businesses around, rather than stimulating the development of new self-sustaining growth, is a common effect of CRA activity. City Commissioner Scott Maddox opined that the business magnet program would create a winner-and-loser scenario. He noted that businesses would likely leave other areas in the city they currently occupy to go to areas in the Frenchtown CRA district, and therefore not contribute to overall growth.
How are CRA decisions evaluated? In 2015, the Tallahassee CRA adopted objective performance measures to be reviewed each fiscal year. So far, the Tallahassee CRA has achieved 9 out of its 13 goals, with another partially met. For instance, post-development taxable value for properties funded by the CRA has increased 20 percent on average, and major redevelopment projects were started twice a year. An annual commitment of at least 85 percent of CRA small business grant funds to its targeted areas was partially achieved. Some objectives, such as “improving the quality of life in Tallahassee,” are evaluated by inputs (like the amount of grants to special events and promotions) rather than outcomes.
Knowing how decisions are made in the Tallahassee CRA is an important part of holding elected city and county officials accountable for how they spend taxpayer money. To find out more about the Tallahassee CRA’s activities, see their 2016 meeting schedule here, and access records of meeting agendas and minutes available here.