OFFICE OF THE CITY COUNCIL

CHERYL L. BROWN 117 WEST DUVAL STREET, SUITE 425

DIRECTOR 4^TH FLOOR, CITY HALL

OFFICE (904) 630-1452 JACKSONVILLE, FLORIDA 32202

FAX (904) 630-2906

E-MAIL: CLBROWN@coj.net

JOINT RULES/FINANCE COMMITTEE ON 2012-212, 2012-213 and 2012-364

MEETING MINUTES

June 20, 2012

5:00 p.m.

Location: City Council Chamber, 1^st floor, City Hall – St. James Building; 117 West Duval Street

In attendance:

Rules Committee Members Bill Bishop (Chair), John Crescimbeni, Lori Boyer, Johnny Gaffney Matt Schellenberg and Clay Yarborough. Excused: Ray Holt

Finance Committee Members Warren Jones (Vice Chair), Bill Bishop, John Crescimbeni and Clay Yarborough. Excused: Richard Clark (Chair), Greg Anderson, Bill Gulliford

Also: Council Members Stephen Joost and Don Redman; Kirk Sherman, Janice Billy and Heather Reber – Council Auditor’s Office; Peggy Sidman and Jason Gabriel – Office of General Counsel; Jessica Deal – Mayor’s Office; Paul Crawford and Jorina Jolly – Office of Economic Development; Phillip Zamarron – Legislative Services Division; Annette Hastings – Tourist Development Council; Jeff Clements – City Council Research Division; Steve Patterson – Florida Times-Union; Jim Bailey and Joe Wilhelm – Financial News and Daily Record; Terry Lorrince – Downtown Vision Inc.; Jerry Mallot– JAXUSA Partnership; Don Shea – Jacksonville Civic Council; Chris Quinn – Chamber of Commerce; Tony Bates – Concerned Taxpayers of Duval County

Meeting Convened: 5:05 p.m.

Rules Chairman Bill Bishop convened the meeting and asked Jason Gabriel of the General Counsel’s Office to make a presentation on Community Redevelopment Areas (CRAs). Mr. Gabriel gave an overview of the purpose, plans and powers of CRAs, which are authorized by the state to local governments as a mechanism to deal with slum and blight conditions by, among other things, collecting area-specific tax revenues to make improvements in the target area. While several powers and duties may be delegated by the Council to an agency for CRA purposes, there are certain powers that remain with the Council as the legislative body. The Council has the ultimate authority to declare areas to be slum or blighted, to approve or amend the required CRA plan or the area, to authorize the issuance of revenue bonds, to acquire or dispose of property within certain parameters, to approve community policing innovations within the area, and to exercise the power of eminent domain. Mr. Gabriel stated that 2012-364 was drafted to remove the Downtown Investment Authority language from 2012-212 and move it to a stand-alone bill. It would delegate the City Council’s CRA management authority for the two downtown CRAs (Downtown Northbank and Southside) while retaining Council as the management authority for the JIA and Soutel/Moncrief CRAs.

In response to a question from Council Member Jones, Mr. Gabriel stated that the exercise of eminent domain power strictly for economic development purposes (i.e. the elimination of slum or blight) is prohibited in Florida per Chapters 73 and 74 of the Florida Statutes. The Florida Legislature, in 2006 in response to the U.S. Supreme Court decision in the case of Kelo v. City of New London CT, codified this law. However there may be other purposes for which eminent domain could be exercised in the context of a CRA improvement plan. In response to questions from Council Member Crescimbeni, Mr. Gabriel was unaware of the last time the City’s Ordinance Code CRA language was verified against the latest revisions to the state CRA statutes, and stated that the downtown CRA boundaries should be identical in the 2012-364 narrative description and on the map handed out at the last joint committee meeting, as confirmed by the JEDC and the City surveyor.

In response to a question from Council Member Boyer, Mr. Gabriel stated that the Florida Statutes have two separate provisions which deserve reconciliation on the subject of “sweeping” unused CRA tax increment funds back into the General Fund of a jurisdiction for general government uses. One provision of the statutes requires tax increment funds to be kept within the CRA for use on approved projects and prohibits the funds from being used for general governmental operating expenses; however another provision permits unused funds to be returned to the contributing jurisdictions at the end of the year if such funds were not otherwise used. The committee requested further research and clarification on this point. The committee also requested from the JEDC a table showing the historical revenue generation and project expenditures of the two downtown CRAs from the time of their creation, if possible. The table should show the years in which the tax increment revenue produced a surplus over project expenses or a deficit, and whether funds were contributed back to the General Fund or if General Fund subsidies were need to cover CRA project costs.

The committee discussed whether CRAs have an expiration date. The state statute does not specify time limits on the existence of CRAs, but Mr. Gabriel pointed out that there are provisions limiting the length of time over which project expenditures financed by increment revenues for the approved CRA plan may occur (30 years for projects in CRA plans adopted before July 1, 2002, 40 years for plans adopted thereafter). Council Member Boyer identified two kinds of issues that should be addressed with regard to the City’s CRAs. First, the action plans are old, out of date, and not very specific; they probably don’t meet current state standards for CRA area plans. Second, the extent of the CRAs’ powers and funding sources and uses need to be clarified since the DIA is proposed to exercise several kinds of powers (CRA-related, non-CRA downtown-related, and administrative) and CRA funds cannot be used for non-CRA purposes. She suggested making the DIA’s CRA-related powers contingent upon City Council adoption of revised plans for the districts.

Council Member Schellenberg proposed that the City Council appoint a majority of the DIA board members, perhaps 5 or 6 of the nine. The committees discussed the ratio of Mayor to Council appointees, the designation of particular categories of membership, and whether Jacksonville residency should be a requirement.

Motion (Schellenberg): that the Council appoint 6 of the 9 DIA board members and that the members be chosen from the following qualifying categories: downtown resident, downtown retail business operator, commercial real estate, downtown property owner, banking/finance, business management, law.

Motion (Bishop): amend the Schellenberg motion to add architect and urban planner to the list of qualifying categories.

Motion (Boyer): amend the Schellenberg motion to require that at least 1 of the 6 City Council appointees reside or engage in business on the Southbank.

Jessica Deal of the Mayor’s Office suggested that the mayor have more than 3 of 9 appointments. Don Shea of the Jacksonville Civic Council cautioned that having too many specifically designated categories of membership might make it difficult to find a sufficient number of strongly qualified nominees for each category. Councilman Crescimbeni suggested fewer membership categories and more required downtown residents/business people. Mr. Shea suggested the possibility of giving the mayor more appointments but imposing a time limit to fill the seats; if the mayor failed to do so, the Council could make the appointment.

Revised motion (Crescimbeni): Mayor makes 5 appointments, City Council makes 4 appointments; the City Council will choose 3 of their 4 appointees and the Mayor will choose 3 of his/her 5 appointees from among 9 specified membership categories: downtown resident [minimum 2 years], downtown retail operator, downtown real property owner, commercial real estate, banking/finance, business management, law, architect, urban planner – no requirement that there be only one in each category); of the Mayor’s 5 appointments, 1 must live or have a substantial business interest in the Northside CRA and 1 must live or have a substantial business interest in the Southside CRA; of the City Council’s 4 appointments,1 must live or work in the Northside CRA and 1 must live or work in the Southside CRA; all members must be Duval County residents – approved.

Page and line number references from this point refer to Ordinance 2012-364.

Peggy Sidman of the Office of General Counsel distributed an amendment to the ordinance requested by Council Member Bishop that would accomplish the following: 1) remove the attachments (standard downtown development and redevelopment agreements, ground lease agreement); 2) on p. 3, line23, inserts a new section amending Ordinance Code Chapter 55 to clarify that the Office of Economic Development provides support to the City Council and to the DIA in their respective roles as CRA agencies; 3) renumbers several sections due to the insertion of the new section referenced above; 4) on p. 21, lines 11-22, remove the section regarding the DIA’s power to negotiate and give final approval to redevelopment and ground lease agreements pre-approved by City Council and insert a requirement that Council approve all such agreements; and 5) on p. 21 line 11, attaching the Downtown Overlay Zone Map.

Jessica Deal of the Mayor’s Office distributed an amendment that would amend Sec. 55.308 to give the DIA power to negotiate and give final approval to standard redevelopment and ground agreements using standard forms pre-approved by City Council and approved by the General Counsel’s Office as to form and legality for each use, once Council approves such standard forms. Until such time as the Council approves the standard forms, all redevelopment agreements and ground leases would require City Council approval.

Motion (Crescimbeni): adopt the Bishop amendment for items #1, 2, 3, 4, 7, 8 and 9, but inset the Deal amendment in place of item #6. Item #5 regarding residency was clarified to Duval County residents.

Motion (Bishop): amend the Crescimbeni amendment to read as follows in Sec. 55.308(c) on lines 6-7 of the Deal amendment: “subject to the Agency’s budget without further action of with approval of City Council…” – approved.

The Crescimbeni motion as amended by the Bishop amendment was approved.

The committees will reconvene next Wednesday at 5:00 p.m.

Meeting adjourned: 7:11 p.m.

Minutes: Jeff Clements, Council Research Division

6.22.12 Posted: 11:00 a.m.

Tape: Joint Committee meeting 6.20.12

Legislative Services Division

Attachments: Ordinance 2012-364

6.20.12