The Midtown Community Redevelopment Area

Dear Editor,

There has been a lot of discussion about the Midtown Community Redevelopment Area (CRA) in current city elections. This article is being written to shed some light as well as provide some background for Midtown residents to consider.

CRAs are not really new. They have been around for some time now. Their stated purpose is primarily to assist cities and other governmental entities reduce slum and blight in their neighborhoods. They are widely used throughout the state of Florida and in fact, have been utilized in the City of St. Petersburg.

There is an existing CRA in downtown St. Pete that raises millions of dollars on an annual basis.  It provided critical funding in the development of the Dali Museum. A very small CRA was developed for Midtown that assisted in the development of the Midtown Plaza, where the now defunct Walmart existed.

There is, however, a distinct difference between the downtown CRA and the small CRA that was created to assist in the development of the Midtown Plaza. The downtown CRA allows for the taxes collected in excess of a base period amount to be dedicated to specific uses such as housing or economic development within the area covered by the community redevelopment area.

That was not the case for the Midtown CRA. For purposes of this article, we will designate the type of CRA utilized downtown as a tax increment financing (TIF) CRA.

At the time of the development of the Midtown Plaza, the issue was raised as to whether or not a TIFCRA could be established in Midtown similar to the downtown TIFCRA. We were told that there was significant reluctance on the part of the Pinellas County Commission to authorize that type of CRA. Without their authorization, it was not possible.

Around 2010 or so, we heard the then existing county commission may be more willing to consider the idea of a TIFCRA for Midtown. They had been considering one for a North County city. In addition, there was increased interest in fighting poverty within the county.

County Commissioner Kenneth Welch led the effort at the county commission level. There were several people within the community familiar with CRAs such as Gypsy Gallardo, and board members of Urban Development Solutions, Inc., who had been advocating for years for a TIFCRA for Midtown that pushed the idea locally.

Mayor Bill Foster and city staff supported the idea as well. The work was begun to develop a new TIFCRA for Midtown during the Foster administration and was well on its way at the time the Kriseman administration came into office.

When Kriseman administration came into office, the work was completed on the TIFCRA and it began funding projects. Because of the design of the program, there was widespread criticism initially because it provided some grants to organizations that did not appear to warrant them.

We are assuming that those issues have been dealt with. However, there are still design issues that are part of the program that needs to be addressed.

The main focus of the program is to provide small grants to organizations for such uses as repairing windows, painting buildings, building renovations, small residential repairs, etc.  Those uses of funds are consistent with uses of other CRAs around the state of Florida.

The problem is that while those uses have been employed for many years around the state, there is very little empirical evidence that these type uses are effective in dealing with the economic needs of communities.  After many years of use, most if not all of those communities are still struggling with very high poverty levels, crime and the other indicia of blight and slum.

What St. Petersburg needs is for the Midtown CRA to be utilized as part of a transformative process rather than the evolutionary process that it is currently being used for. As part of the New Deal for St. Petersburg, we are calling for the city to authorize the CRA to monetize some of its future tax collections through the issuance of bonds that could be sold now.

The proceeds could be used as part of a 10-year transformative plan to develop a significant amount of new affordable housing and other economic development projects.  Rather than simply relying upon the normal market place, which does not work very well in Midtown if at all, the city is going to have to spearhead the effort to get affordable housing and economic development going in the area.

The city could borrow as much a $30 million against these future revenues and utilize these dollars to spearhead these activities. If they could leverage these dollars on a two to one basis, over $90 million could be raised.

The state, federal government, banks and other financial institutions have announced large billion dollar funds that can be utilized to leverage up the city dollars.  What is needed is boldness and desire to develop a realistic transformative plan.

There have been many small incremental plans utilized over the years, similar to the current plan. History suggests that the current efforts will be no more successful than the previous plans have been, or certainly no more successful than they have been around the state of Florida over the years.

It is now time for a New Deal for St. Petersburg that includes a community based economic development plan that will transform the Sunshine City Renaissance area.

Larry Newsome