February 1, 2011

Table of Contents

Members of the Task Force………………………………………………………… Introduction ………………………………………………………………………….. Section 1. The Case for Downtown………………………………………………. Section 2. Land Use Recommendations…………………………………………. Exhibit A……………………………………………………………………… Exhibit B……………………………………………………………………… Exhibit C……………………………………………………………………… Section 3. Governance and Implementation…………………………………….. Section 4. Business Case & Economics…………………………………………. Section 5. Near-Term and Related Issues………………………………………. Section 6. Summary and Conclusions…………………………………………… Acknowledgements………………………………………………………………….

2 3 5 8 11 14 19 20 24 30 34 37


Members of the Task Force

Preston H. Haskell, Chairman The Haskell Company Edward E. Burr GreenPointe Holdings, LLC Ben Carter Ben Carter Properties A. Hugh Greene Baptist Health Steven T. Halverson The Haskell Company M. C. Harden III Harden & Associates M. Lynn Pappas Pappas Metcalf Jenks & Miller PA Robert M. Rhodes Foley & Lardner, LLP John D. Rood Vestcor Peter S. Rummell Rummell Company LLC John M. Welch, Jr. Board Member, DVI

Advisors to the Task Force Adam Hollingsworth Chief of Staff Office of the Mayor City of Jacksonville Ronald D. Barton Executive Director Jacksonville Economic Development Commission Donald A. Shea Executive Director Jacksonville Civic Council



In March 2010, Mayor John Peyton and the Jacksonville Civic Council determined that reversing the decline of downtown Jacksonville was a matter of urgent civic priority. Despite many positive achievements in the past two decades, vacancy rates for office buildings were at all time highs, with a drop in downtown employment from 60,000 to 51,000. Retail activity was almost non-existent. Efforts at growing the number of downtown residents from approximately 2,000 to a more peer-city comparable of 10,000 had stalled. Even during the Task Force’s study period, three major downtown businesses announced plans to move to the suburbs. While the city’s suburbs had thrived, the condition of Jacksonville’s downtown was at its most distressed in recent years. Meanwhile, the City was faced with approximately 32 acres of vacant land (the “Shipyards” property) coming into City ownership, and three large blocks occupied by the County Courthouse and old City Hall were about to be permanently vacated. These represented both a challenge and an opportunity: would downtown be blemished by yet more vacant or unused space, or could this newly acquired riverfront land at the eastern edge of the urban core be used to expand and revitalize the downtown experience? Against this backdrop, the Civic Council, with the Mayor’s support and encouragement, formed the Northbank Redevelopment Task Force, with the Civic Council providing the bulk of the task force membership, while the office of the Mayor and the Jacksonville Economic Development Commission made top-level officials and other resources available to the Task Force. The initial charge to the Task Force was to examine and make recommendations for the development of the city-owned property described above, lying between downtown and the sports complex, north of the St. Johns River, referred to herein as the “study area”. Also, the charge included making recommendations regarding governance and implementation as well as financing and economics. However, this charge was expanded somewhat during the course of the Task Force’s work to include adjacent downtown properties, related issues, and certain immediate steps to be taken.


The organization of this report also evolved somewhat during the study period. As finally organized, Section 1 makes the “case for downtown” – why downtown is important to everyone in the community. Section 2 lays out a vision for land use within the study area. Very importantly, an implementation agency with appropriate powers and resources dedicated to downtown redevelopment, is described in Section 3. Section 4 proposes sources and uses of funds for implementation of this vision, and Section 5 addresses the immediate and evolving steps which are essential to catalyzing redevelopment of the study area. Section 6 provides a summary of the major findings and recommendations, and serves as an executive summary of the report. The Task Force acknowledges that there have been numerous studies and reports within the past 18 years regarding downtown and recommendations for improvement and redevelopment. It is hoped, that this report may have greater impact due to its inclusion not only of recommendations for land use, but also for a strong implementation authority to stimulate and oversee private and public endeavors for downtown redevelopment, and for sources and uses of funds. However, it should also be noted that many of the recommendations are broad and directional, and further research and refinement will be required prior to adoption or implementation. In creating the Task Force, Mayor Peyton and the Civic Council realized that the further development and implementation of its findings and recommendations could not be undertaken within the approximately one year remaining in the current Mayor’s term of office. However, it was agreed that within that year the Task Force could indeed create a conceptual, long-term, aspirational template for community discussion which, in particular, would stimulate thought and debate during the City Council and Mayoral campaigns of early 2011. Beyond that, the Task Force believes that its report will provide a set of findings and recommendations that should guide the Council and administration taking office in mid-2011, and policy makers beyond, in their actions regarding downtown redevelopment. It is in this spirit that this report is submitted to the people of Jacksonville and its elected leaders.


Section 1. The Case for Downtown All great cities of the world have a nucleus, a center, a soul. A city simply cannot prosper economically or qualitatively without a vibrant, functioning downtown. A fun, energetic and productive center city is vital to every successful region, including ours. Without a useful downtown, the surrounding neighborhoods are simply left with a hollow core, an empty eyesore, a symbol of a time gone by, a reminder of former grandeur that does not go away. Downtown vitality has two dimensions. First, a vibrant city center delivers tangible economic benefits to the entire city – not just those living downtown. But beyond that, it is a symbol of community cohesion, partnership between the private and the public sectors, quality of life, local pride, external reputation, and community history. Tangible Economic Benefits Perhaps foremost, downtown has a favorable impact upon the property values of our residential neighborhoods. Downtown buildings assessed at full value reduce the tax burden on suburban homeowners, while requiring far fewer services – such as schools, fire and rescue, and crime prevention. Downtown is a net financial contributor to the suburbs. For new businesses coming to town, the central district can be economically more advantageous than suburbia. The expensive infrastructure is already in place. Employers located in the urban core can more readily recruit workers from all parts of the city, enhance commerce by having businesses close to each other, and create their own energy that feeds on itself and provides multiplier effects business-wise and socially. Because downtown is located at the center of our metropolitan area, workers can reach their places of employment more or less with equal ease from any part of the city. The use of public transit is enhanced by workers commuting to and from downtown. A city’s downtown is a physical reflection of civic pride, self worth and confidence that is immediately seen and felt by visitors and visiting business persons. In the national (and


even global) competition for new business, downtowns, not their suburbs, define the competing cities. The television aerial shot during a football game is of downtown, not a suburb. These images, and the institutions which constitute them, often form an enduring first impression that leads to return visits and continuing business interest. Downtown helps reduce sprawl by concentrating activity in one area. By building density in the heart of the community, we make the entire city more livable, and protect and sustain the outlying areas. An economically productive downtown spills over into the suburbs, raising values and per-capita incomes throughout the community. Intangible Considerations Downtown is the only place central enough for major leisure events – professional sports, entertainment, festivals and special events, fairs, and the like. It is an important community space where members of all segments of the community can meet equally for parades, speeches and other community events. It can host things that simply would not happen elsewhere. It is the heart of the community, and the site for government, arts, churches, and financial institutions. No single neighborhood can be more socially important or productive than downtown. Tourism and convention activity are enhanced by a strong downtown. Indeed, downtown is the only plausible location for a successful convention center. Tourists are attracted to downtown events and amenities, and conventioneers stay longer and spend more as well. To these visitors, Jacksonville’s downtown offers unique opportunities to see our history, visit small shops, and engage the river in many ways. Downtown is essential to the attraction of many young people, who are actively seeking to live in dense, mixed-use communities which don’t require cars, and shops, residences, parks and businesses exist close together. These are mostly well educated and professional, a growing set of workers upon which competitive cities rely and flourish. Making downtown attractive to this important demographic segment is critical to the economic and intellectual growth of our city.


Conclusion Jacksonville has an especially strong case for a successful, central downtown. It is a “spread out” city, characterized by numerous neighborhoods scattered over hundreds of square miles, divided by rivers, rail lines, and expressways. No one – or even several put together – of these neighborhoods can provide the energy, activity, and community that our downtown can. Properly developed, it becomes an asset which our citizens use, enjoy, and value as much as their own neighborhood. Indeed, downtown becomes “everyone’s neighborhood”. Jacksonville’s urban core possesses certain features which give it potential to become a great downtown. Transportation infrastructure to and from downtown is very much in place. Uniquely, the magnificent St. Johns River flows through the heart of downtown, providing a focal point and a visual amenity that is unparalleled. It has a modern and comprehensive urban sports complex. It has a consolidated government which can act in the interests of the entire city. Subsequent sections of this report provide a roadmap for creating a vibrant downtown that capitalizes upon these advantages, enhancing the economic and social wellbeing of all its citizens.


Section 2. Land Use Recommendations This section sets forth, in general terms, the findings and recommendations of the Task Force regarding land use and development of the study area. It is divided into three parts, the first dealing with the former City Hall property north of the Hyatt Hotel together with the existing County Courthouse site, and its parking lot, immediately to the east. The second part deals with the so-called Shipyards property, bounded by Berkman Plaza on the west, East Bay Street on the north, and Metropolitan Park on the east. The third part discusses opportunities for linkages and connectivity with adjacent properties to the east and west, a band extending from the Times-Union Center for Performing Arts to Metropolitan Park. City Hall and Courthouse Sites In 2012, functions located in the former City Hall and current County Courthouse will be relocated to the new Courthouse complex now under construction on the western side of downtown. Both buildings are approaching 60 years since construction, and are generally regarded as obsolete. The City government has no plans for occupancy of either building and the Task Force has thus devoted its attention to replacement uses. The former City Hall property consists of approximately 100,000 square feet, and is immediately adjacent to the Hyatt Hotel on the south. The Hyatt Hotel comprises 966 rooms and approximately 90,000 square feet of ballroom, meeting rooms, and conference space. However, it has no space for an exhibition hall. The Hyatt interests have expressed considerable interest in having the City construct a comprehensive convention center on the Courthouse site, with appropriate connections to the hotel. The Task Force received a presentation from the Hyatt interests and its architects proposing a comprehensive and elaborate convention center of 180,000 square feet, with long-term expansion of the convention center and/or hotel on the City Hall site. The Task Force is keenly aware that the existing Prime F. Osborn Convention Center has failed to meet expectations since its opening over 25 years ago. It is generally recognized that this failure results from the Osborn Center being remote from the central business district and having no nearby hotels. The property east of the Hyatt Hotel, on


the other hand, is more centrally located and is adjacent to a large hotel. The Hyattproposed convention center would be more than double the size of the Osborn Center and would be comparable to convention centers in Fort Lauderdale, Tampa, Orlando and Birmingham. After careful consideration of the Hyatt’s desire to use the entire Courthouse block, the Task Force considered a different plan which would use the City Hall Annex block north of the Hyatt Hotel and potentially a portion of the Courthouse block for construction of an exhibition hall, and make all or a majority of the Courthouse block available for mixeduse retail, entertainment, dining, and public open space. The exhibition hall would be attached to the Hyatt Hotel and would contain (if limited to the City Hall block) approximately 80,000 square feet of pure exhibition space on the second level (which is the same level as the Hyatt ballroom and other public spaces), with additional “flex space” of approximately 40,000 square feet at the lower (street) level. The balance of the street level would contain retail space along Bay Street, a public entrance on the Newnan Street (west) side, and loading docks and related uses on the Market Street side, which would be adjacent to the service docks of the hotel. In addition to placing the exhibition hall entirely upon the City Hall Annex block, consideration should be given to treating that parcel and the Courthouse site as a single complex, containing both a larger exhibition hall and retail/dining/entertainment space. This would involve closing, bridging, or relocating a portion of Market Street south of Bay Street, but would provide for greater flexibility in sizing the exhibition hall without significantly diminishing the land available for other uses. For example, taking just the Market Street right of way would add 15,000 square feet to the exhibition hall. In either case, the resulting convention center would be a hybrid of the Hyatt’s conference rooms, ballroom and meeting rooms, together with the new exhibition hall and flex-space. The usable areas would be significantly larger than the Osborn Center, which contains 76,000 square feet of exhibition space, 29,000 square feet of meeting room space, and a 10,000 square feet ballroom. Such a center could successfully penetrate a very significant portion of the state and regional convention and tradeshow market, as well as a sizeable segment of the national market.


To meet the demand of additional parking created by a new, comprehensive convention center, the Task Force recommends consideration of building an approximately 325space parking garage, one possible location being on the west side of Newnan Street, utilizing a portion of JEA-owned property, and currently private property consisting of one- and two-story office buildings. These buildings are tenanted primarily by law offices, which presumably would seek to relocate when the new courthouse is completed. Exhibit A provides a very preliminary layout of a possible exhibition hall plan. It does not depict the space which could be added by eastward expansion beyond Market Street. The Task Force feels that this general approach is the most feasible and desirable option for the following reasons: • It frees up most if not all of the Courthouse block for mixed-use entertainment, retail and dining space, effectively extending our core downtown eastward, and complementing and extending the dining and entertainment district currently emerging on East Bay Street. Otherwise, the hotel and convention center would become a remote, rather isolated extremity at downtown’s eastern edge. • The mixed-use complex would provide additional dining, shopping, and entertainment destinations for out-of-town conventioneers using the Hyatt Hotel/convention center. • The mixed-use complex would make the Hyatt a more desirable destination for non-convention guests, placing them more in the middle of a surrounding set of downtown venues, rather than being at its extreme edge. • The cost of the exhibition halls, largely or entirely a public expenditure, would be substantially less than that of the proposed Hyatt plan, and thus more consistent with the benefit received and more appropriate to the foreseeable financial resources of our City.


Exhibit A – First Page


Exhibit A – Second Page


Given the foregoing recommendation, the Task Force also focused upon determining more specifically the character and use of the Courthouse property. As part of this research, the Task Force met with regionally prominent and successful real estate developers to obtain their opinions as to the feasibility of developing a mixed-use project on the Courthouse site. These developers felt that the site had the necessary ingredients for successful development: sufficient size, riverfront location, proximity to existing downtown venues and their activity, and the demand which would be created by an adjacent convention center and hotel. Indeed, one of the developers has been in contact with national retail and restaurant chains who have expressed favorable interest in the site. While specific site configuration would require considerable additional study, one preliminary plan is shown in Exhibit B. This plan envisions a two-level complex with a central courtyard extending to the river, with retail stores, restaurants, cinema, and related uses. It would be developed in two phases, with the initial phase being on the north half. The southern half could initially be used for parking and/or a destination venue for outdoor entertainment or other “people space”. The foregoing development plan lends itself to implementation over the next three to four years; however, to maximize the value of the new convention center, completion and opening of it and the mixed-use venues should occur as simultaneously as possible. Planning, financing, selection of a developer, negotiations with Hyatt, and acquisition of the property for the Newnan Street parking structure can all proceed prior to the vacating of the former City Hall and Courthouse in 2012. Demolition and construction could proceed thereafter, with completion in approximately two years. The Task Force also believes that substantive public sector financial investment will be required. As in most cities, the convention center will likely be financed largely or entirely by the public sector. The mixed-use development of the courthouse site will require some combination of land donation, tax abatement, and cash investment. These requirements are discussed in greater detail in Sections 3 and 4.


Exhibit B


Shipyards Property The Shipyards property consists of approximately 28 acres of clear, undeveloped, cityowned land. While its St. Johns River shoreline is highly irregular, regulatory approval may be received for bulkheading and filling certain of the recesses in the shoreline, which would provide up to 60% more land (approximately 16 acres) as well as providing more north-south depth and regularity of shape. Compared to the former City Hall/Courthouse property, the Shipyards property is much greater in size and more remote from downtown. The Task Force therefore feels that its development should contemplate a timeframe of perhaps two decades or more. However, its ultimate realization would result in a magnificent mixed-use urban fabric extending from the central business district, along the river, to the sports complex. The arena, baseball park, and football stadium are excellent, up-to-date facilities with adequate parking and good accessibility from adjacent highways and expressways. However, they are sorely underutilized, standing vacant the great majority of the time. The Task Force believes that the development recommended herein should and will ultimately result in synergies with the sports complex venues. It is an emerging trend in other cities that entertainment, retail and dining are interactive with events in such venues. Events such as concerts, shows, and other performing arts events, as well as sports events, can be longer, more enjoyable, and more diverse experiences than merely attending a game and then going home or elsewhere for dining and entertainment. Given the foregoing characteristics, it is clear that a variety of uses can and must be developed on this property. Each of these is described below. Residential. The Shipyards land represents an excellent site for downtown residential development. Its waterfront location, the amenities and attractions proposed on the Courthouse site, and proximity to downtown make it a very desirable location for much-needed residential development. Having more urban residents is the most fundamental prerequisite to successful downtown development.


Offices. The construction of low- and mid-rise office buildings on this property would constitute an answer to the flight of office buildings to the suburbs. Similar to Riverside Avenue at the opposite end of downtown, these buildings would enjoy waterfront proximity, on-grade or lightly structured parking, plus proximity to housing, entertainment and retail. Commercial. It is not unreasonable to assume that, over time, a small commercial district would arise in the eastern precincts of the Shipyards property. This would be more of a convenience retail center for nearby residents than a destination center such as that proposed for the Courthouse. As the property becomes populated with office buildings and more active use is made of the existing sports venues, a medium sized hotel near the easterly end of the property would be entirely feasible. Both the hotel and shopping center would also serve out of town visitors to the entertainment park described below. The overall result of the development described above would be a vibrant, interactive downtown making optimum use of its sports and entertainment venues, permanent downtown residences, and places of business. A final and important development feature which the Task Force considered for the Shipyards property is an interactive destination entertainment park which would draw from all parts of the city. Members of the Task Force met with a Jacksonville-based developer and operator of such parks, located in similar places and similar cities, which have been very successful. The elements in such a destination park might consist of a London Eye type wheel, a coaster, adventure golf, a zip line course, and others. The project could begin with only a few such elements, to which more could be added in phases. It is not necessary that all of the elements be contiguous, but could be dispersed throughout the development, and certain ones could be discontinued or relocated at a reasonable cost, to provide for more permanent urban elements. In other cities where this type of park has been developed, the operational economics have been uniformly positive. Using a public-private partnership structure, the City contributes land and a portion of the construction cost, and the developer and its


investors contribute the balance and receive the profits for a period of time. At that point the assets revert to the City, and could be continued, relocated nearby, or discontinued. The vision for such multi-use development of the Shipyards property lends itself to certain design concepts and standards. These include diverting pedestrian traffic from Bay Street onto the site with wide winding sidewalks and features of visual appeal and interest on either side of the walkway. Residential buildings could be interspersed with other uses, and ample use of green space should be made. The St. Johns Riverwalk should be completed to Metropolitan Park and provisions should be made for boat marinas at appropriate locations. Finally, the Task Force believes that appropriate incentives should be made available to encourage the development described above. These may include land donation, property tax abatement, job-creation grants, and/or other inducements further described in Section 4. Linkages to Adjacent Sites In addition to the foregoing recommendations concerning the study area, the Task Force believes connectivity to existing elements along the riverfront both east and west should be integral to the development vision set forth above. In particular, the barrier which exists below the Main Street bridge between the Hyatt Hotel and the Jacksonville Landing should be mitigated or eliminated. This would require the removal of a certain amount of parking, together with improvement of Coast Line Drive, the riverwalk, additional lighting, way finding signage, and landscaping and green space. To the east, the role and use of Metropolitan Park should be re-evaluated. It is currently remote and underutilized, and certain of its features may lend themselves to being relocated to the Shipyards property, further strengthening that area as an active destination for the entire community. The existing Metropolitan Park land could then be considered a part of the study area, with land uses similar to those recommended above for the Shipyards property.


As already mentioned, the three sports venues are an asset which should ultimately become integral to this entire development. They regularly draw between a few hundred and 80,000 people to the area, and the potential for enlarging and integrating this dynamic into the development is an important one. These measures, though relatively modest, would result in a rich, broad, and diverse band of activity stretching from the Times-Union Center to Metropolitan Park and the sports complex. It would make available a comprehensive set of amenities consisting of performance venues, entertainment, retail, housing and office buildings, interactively located along the St. Johns riverfront, to both downtown residents and the broader community. These features are depicted in their entirety in Exhibit C.


Exhibit C


Section 3. Governance and Implementation The previous section of this report makes recommendations for land use in the Northbank area of downtown. This section describes and advocates a governance structure and implementation agency that enables development and implementation of these objectives. The Task Force studied downtown implementation agencies in cities and other jurisdictions throughout Florida and beyond, and found that successful downtown development was invariably correlated with the existence of an active, independent, focused and well financed such entity, which Jacksonville does not possess. It should be noted that Jacksonville does possess an effective Jacksonville Economic Development Commission (JEDC), which has wide-ranging responsibilities, including downtown development. Its primary and dominant responsibility is synonymous with its name: economic development for Jacksonville. It also houses the city’s Film Commission, the Sports & Entertainment Board, and oversees development of the Cecil Commerce Center. Proposed Implementation Agency. Because downtown redevelopment is a major, multi-faceted, long term and complex challenge, it deserves the concentrated and continuing effort of a city agency dedicated solely to the downtown mission. The Task Force recommends creation of a new agency, perhaps named the Downtown Improvement Authority (DIA), that can fulfill that role, establishing a clear and accountable entity responsible for leading downtown revitalization efforts. Creation of the DIA provides a number of additional benefits. First, it will provide clarity of responsibility and eliminate potential conflicts. Because JEDC has city-wide responsibility to manage economic development activity, it must often choose between downtown and competing locations in the city to apply its limited funding and resources. Establishment of DIA will remove this conflict and enable JEDC to focus on economic development and job creation outside of downtown.


Because redevelopment of downtown is a long-term proposition, requiring a continuous and sustained commitment and multi-year work program, it is necessary to develop a structure that can be sustained beyond a single mayoral administration. While the efforts and priorities of Jacksonville’s current mayor and JEDC director toward downtown have been excellent, downtown has not always received a commensurate level of support and has received minimal funding. The DIA can ensure the consistent reliability of staff and funding to address the long-term needs of a successful downtown revitalization program. Furthermore, since several City departments and divisions have responsibility for downtown functions and programming, all of those activities should be coordinated by DIA acting as the City’s lead agency for downtown redevelopment. The Mayor should charge the DIA with assembling and leading a downtown work group consisting of all City departments engaged in downtown. The work group should include representatives of JEDC, public works, parks and community services, special events, and housing & neighborhood departments. The work group will met regularly to communicate and coordinate downtown redevelopment activity. The DIA will serve as the City’s Community Redevelopment Agency (CRA) under Florida Statutes for the downtown Community Redevelopment Areas. In this capacity, it will manage the two existing tax increment financing (TIF) districts downtown. Section 4 of this report provides detailed recommendations on funding strategies for DIA, including the treatment of revenues associated with the downtown TIF districts, and the opportunity to bond those funds for downtown redevelopment initiatives. The DIA should house and manage all parking-related activities currently contained in the Public Parking Division, Parking Enforcement Division, and other entities, to insure that a these functions complement the DIA’s redevelopment strategy. The DIA would also oversee all downtown events and entertainment activity presently operated by the Office of Special Events, with a view toward their not simply being entertaining to the public, but integral to the appeal, activity, and development of downtown. The existing Downtown Development Review Board (DDRB), the one-stop planning and permitting agency for downtown, also would fall under the responsibility of DIA and be staffed by it.


Finally, it should be noted that this agency would have jurisdiction covering all of downtown, not just the Northbank or the study area. This jurisdiction consists of the three Tax Increment Districts, which are also the two Developments of Regional Impact (DRIs). Constitution of DIA The Task Force recommends that the DIA consist of seven members, four appointed by the Mayor and three by the President of the City Council. All appointments should be subject to confirmation by the City Council. Four-year staggered, renewable terms will ensure continuity of governance, and transcendence of the commission’s composition beyond any four-year term of the Mayor or Council members. A City Council member representing the downtown core should be included as an additional, non-voting DIA member. Under current districting, three council districts touch downtown, resulting in its having no single council member as a strong advocate. Strong consideration should be given during the next redistricting measure to making all of downtown part of a single council district. Representatives from key agencies should be identified as liaisons to DIA. Those may include JEDC, Downtown Vision, Inc., JTA, and others. Specific professional skills should be sought in making appointments to the DIA, including finance, real estate, and marketing. The Board will recruit an Executive Director who will be responsible for all management aspects of the DIA, and serve at its pleasure. Budgeting Process A major factor in attracting private investment in downtown Jacksonville is the level of confidence among private developers that the City’s project approval process is applied consistently and efficiently. Currently, redevelopment agreements must be approved by the City Council on a project by project basis, representing a significant disincentive to downtown redevelopment. This methodology should be changed to provide a better ability for the DIA to act, under the oversight of the Mayor and City Council.


The Downtown Improvement Authority shall prepare an annual budget for approval by the mayor and submitted to the City Council as part of the executive branch budget. The annual budget should identify the level of funding necessary to support the administrative operation of DIA, as well as proposed downtown capital improvements and development incentives. The budget and programs therein must be consistent with the reinvestment policies previously approved by the City Council. Those approved policies establish guidelines for the utilization of economic development incentives. Customary City Council oversight of the DIA would be achieved through the review and approval of the annual budget. Once budget approval is obtained, DIA would have the discretion to negotiate redevelopment agreements consistent with the budget and approved investment policies. Agreements that are consistent with the budget and approved investment policies should not require further council approval. Any redevelopment agreements, or financial incentives which result in exceeding any year’s budget would be subject to Mayoral and Council approval. This discretionary authority for DIA would be conceptually similar to that already established for the Jacksonville Children’s Commission and the Public Service Grants Council. All funding sources and uses will be reported to the City annually through the municipal budgeting process. Beyond the costs necessary to sustain its administrative operations, all DIA revenues shall be used to structure incentives to attract and retain employers in the downtown area. DIA shall have the authority to make multi-year incentive commitments, subject to the oversight of the DIA Board, the City Administration, and City Council as exercised through the budget process.


Section 4. Business Case and Economics This section consists of two parts. The first develops general estimates of the public support, or financial incentives that are required to fund the redevelopment objectives set forth in Section 2 above. The second part discusses the potential sources of such funds. Estimated Public Support Requirements Understanding the costs of redeveloping Jacksonville’s downtown is a relatively straightforward process. To restore the loss of some 10,000 jobs and bring some 10,000 new residents to downtown, the playing field must be made approximately level, in economic terms, as to developing in the central urban district versus doing so in the suburbs. This means that the City, through its implementation agency with appropriate powers, must provide that level of financial assistance which renders downtown nearly – but not precisely – as economical as the suburbs. The reason that the two need not be exactly equal is that downtown has, or should have, greater intangible values for owners, residents, employers, employees, developers and customers, as set forth in Section 1 of this report. Various approaches may be used to quantify the cost of “leveling the playing field”. However, the approach used by the Task Force is one that involves comparing the cost of land and construction between downtown and the suburbs. The components of this cost are set forth below: Land. Land in the suburbs can be purchased for approximately 15-25% of the cost of downtown land. With the exclusion of land devoted to parking, a high-rise building downtown occupies between 15-25% of the land area footprint that a low-rise suburban office building does. Thus the cost of land per unit of building area tends to be comparable between the two locations. This reasoning is also applicable to residential buildings; however, the land requirements for retail or entertainment may approach the land required for the same building in a suburban location.


Construction. Construction cost per usable square foot of a high-rise building is considerably greater than that of a low-rise building. This is because (a) the efficiency of a high-rise building is lower due to the space required by elevators and by generally smaller floor plates, and (b) the construction cost per gross square foot of a high-rise building is greater than that of a low-rise building due to heavier structural components, greater life safety requirements, and elevatoring. The combination of these two factors will result in a premium for high-rise construction of approximately 15 to 30%. Parking. The number of automobile parking spaces for a downtown building will generally be slightly lower than that of a suburban building due to mass transit availability and the potential for downtown residents to walk to their place of business, which are somewhat offset by the lower land requirements for a multilevel parking structure versus an at-grade parking lot. However, the construction cost per space of a parking structure exceeds that of an at-grade parking lot by a multiple of approximately ten times. Indeed, the cost of structured parking is often used as shorthand for the overall cost differential between suburban and downtown buildings. To summarize the comparison between downtown and suburbia: land costs can be roughly equal, depending upon exact location; construction costs are generally higher downtown by as much as 15% or 30%; and parking costs can be as much as ten times greater. Using current costs of construction, and an occupancy ratio of 250 s.f. per person for an office building, and parking of approximately one automobile space per employee, the public assistance or incentive required to make downtown approximately equal to suburbia is in the vicinity of $13,000 per person employed. For housing, assuming one automobile space and two persons per residential unit, the structured parking cost is approximately half that amount per person. Putting that cost of $13,000 per office worker or residential unit into a proper context requires projections of desired growth in downtown employment and residency over time. To restore the downtown employment base to 60,000 persons over a 10-year period, for example, a public investment of approximately $13 million per year would be


required. Similarly, to grow downtown residency by 2,000 residents per year for the foreseeable future, a public commitment of $7 million per year is needed. These amounts do not include major one-time expenditures such as that for the convention center/exhibition hall, the entertainment park, and the waterfront linkages proposed in Section 2. Assuming such expenditures to be approximately $80 million and bonded over 25 years, debt service would add approximately $6 million annually, for a grand total of approximately $29 million per year. The foregoing calculations are admittedly approximate, not highly scientific, and based upon assumptions which in reality could vary considerably. Other quite valid approaches could be undertaken. Nonetheless, these serve as reasonable approximations for purposes of this report. Sources of Funds To fund the redevelopment goals set forth in Section 2 and the costs thereof discussed immediately above, the City must consider multiple sources of funding. As detailed in the previous Section 3, the Task Force recommends creation of an implementation agency, tentatively named the Downtown Improvement Authority (DIA), to receive these funds and implement the measures recommended in Section 2. As general principles, the Task Force recommends that revenue from downtown stay downtown and the City leverage its financial resources to provide the maximum possible return on investment for its citizens. These principles necessarily reach across a wide spectrum of funding sources, to which the Task Force encourages full and serious consideration by the Administration and City Council. Tourism Investment District. There is considerable interest within the hotel-motel industry in seeking state statutory authority to impose a tax upon certain revenues within its industry and within a specified jurisdiction, presumably Duval County. The proceeds would be used for purposes of promoting tourism activity within that district. While not yet a reality, this initiative has substantial industry support and should be actively pursued.


Special Events Management & Production. The City has a well-funded special events office, which should be shifted organizationally to fall under the management of DIA. That structure would ensure that the maximum number of special events are produced downtown each year, and would enable DIA to aggressively seek new revenue from sponsorships, media sponsorships, vendors, and the like. On-Street Parking Enforcement. Transferring parking enforcement from the City to DIA would enable the City to reduce its cost of operating the parking program by shifting employee salaries and benefits to DIA. This will also result in greater efficiencies in operation of the parking meter network and enforcement of other parking restrictions downtown. Off-Street Parking Facility Management. Operation of City-owned garages downtown should shift to DIA for reasons of cost savings to the City, revenue generation for DIA, and flexibility to structure parking incentives to prospective downtown office occupants and employers. Subject to restrictions on revenues imposed when the garages were financed, and management expenses, net parking income should be a source of funding for downtown redevelopment. Tax Increment Financing. Currently, two TIF districts exist in downtown Jacksonville. However, the future revenue streams of the TIFs have been heavily encumbered to support commitments and development incentives not specifically tied to the TIF districts and, egregiously, to balance the General Fund. Such practices should cease, with all future TIF revenues reserved for use within the TIF district under the auspices and management of DIA. Grants. DIA should have the ability to receive grants from all levels of government, as well as from foundations, philanthropies, and private organizations. In particular, the DIA should be designated as the administrative entity for downtown job creation investments, such as state Qualified Target Incentives (QTI) grants.


Disposition Proceeds for City-Owned Property Downtown. Acting as the City’s downtown revitalization agency, the DIA would receive all net proceeds arising from sale or lease of redevelopment parcels. Public/Private Partnerships. There is growing familiarity with and use of project development in the U.S. wherein a governmental agency partners with a private entity in creating and financing a project with a combination of public and private funds. The private entity usually builds and operates the facility for a fixed period of time. Utility Revenues Finance District (URFD). This approach would establish a formula under which a percentage of the revenue from JEA sales downtown would flow into a newly-established Utility Revenues District and be managed by DIA for capital investments downtown. Such investments could be made directly from revenues of the URD, or be bonded in the case of large-scale need. Private Funds. Many of the recommendations made or implied in Section 2 (particularly within or close by the sports complex) should involve a mix of public and private dollars, similar to Public-Private Partnerships (PPP) successfully implemented in other cities. General Fund. Recognition should be given to the fact that all of the separate, discrete measures described above may or may not meet the required investment in downtown. Consideration should be given to dedicating those property taxes which derive from downtown to downtown development. While current conditions do not augur for immediate implementation of a millage increase, it should be noted that Jacksonville’s peer city-counties in Florida impose ad valorem millage rates in the 11 to 13 range, while ours is below 10. Not only is this figure low in terms of comparable jurisdictions, it is historically low: in 1986, the rate was 12.3 mills. While considerable study and analysis is needed to determine the amounts which each of the foregoing sources would generate, the Task Force believes that, in the aggregate,


they would likely meet or exceed the requirement of $29 million annually identified earlier in this section. The Task Force acknowledges that raising new revenue is never an easy task, but Jacksonville is a low-tax city, and the case for greater investment in downtown is a clear and compelling one.


Section 5. Near-Term and Related Issues As previously noted, the study area for which the Task Force is responsible generally extends from the eastern edge of downtown to the sports complex. However, in the course of its work, the Task Force realized that there were a number of issues relating to properties outside of its study area which have a significant impact, particularly in terms of immediate steps which will catalyze or accelerate the longer-term goals. This section addresses the most important of those issues, and makes recommendations for actions in connection with them. Laura Street Approximately two years ago, the Administration and JEDC determined that Laura Street from City Hall at the north end to the Jacksonville Landing at the south, should be reconstructed to enhance its physical appearance, make it more pedestrian friendly, and provide a greater sense of continuity for the office, retail, governmental and other spaces either in place or planned. Accordingly, those physical improvements are now under construction with completion expected in the first quarter of 2011. The Task Force believes that these physical improvements will indeed make Laura Street an important north/south corridor with the potential to enhance pedestrian activity, improve and expand retail and entertainment opportunities, and create housing developments. The Task Force notes two specific examples regarding Laura Street. The first of these is the proposed development known as the Laura Street Trio/Barnett Building. A group of private developers has contracted to purchase the three vacant buildings at Laura and Forsyth Streets, and the former Barnett Bank Building at Laura and Adams Streets. The adaptive reuse planned for these buildings include retail and restaurant spaces on the ground floor, condominium and rental units in the Trio buildings, a new parking structure, and a combination of housing and boutique hotel in the Barnett Building. However, these plans are dependent upon public sector support from the Downtown Historic Development Fund, and other incentives and/or loan guarantees. The Task Force urges that this important development be strongly supported by the appropriate public agencies, and that consideration be given to a public-private partnership that would be financially positive for the city and the developers.


The Task Force’s second recommendation is that Laura Street be opened to the St. Johns River by “carving out” a portion of the Jacksonville Landing building on axis with Laura Street. This would extend Laura Street to the public activity plaza on the riverfront side of the Jacksonville Landing, and clearly opening it to the urban fabric to the north. DVI Initiatives In March 2010, Downtown Vision Inc. released an important document entitled Turning the Corner: Rethinking and Remaking Downtown. While the DVI report did not address the Task Force’s study area, it made a number of very important recommendations, whose implementation will greatly enhance the process of redeveloping the study area. Important among these are: • Resources that would encourage activities and housing should be focused upon the area east of Laura Street and north of Bay Street. This part of downtown has already begun to emerge as an “arts district” and is adjacent to the study area. If the recommendations contained in Section 2 of this report regarding the Courthouse and City Hall property are implemented, this general area will become the most important part of downtown for vibrant, 24/7 activity. • Security, code enforcement, and police presence in downtown should be significantly enhanced. A substantial, dedicated Sheriff’s Office patrol should exist for downtown, including the study area as it develops. This would also include dealing with the problem of panhandlers, loiterers and homeless who loiter the street, parks, and vacant properties in downtown, and generate a variety of “nuisance” activities. • DVI, together with the Downtown Committee of the National Association of Industrial and Office Properties (NAIOP) advocates the reform and unified management of all downtown parking facilities, revised pricing including no charge at nights and weekends, and using all revenues for downtown maintenance and improvements. The Task Force concurs in these findings, and as noted in Section 4 of this report, the implementation agency should include


management and financial control of all public parking, both within the existing downtown and the study area as it develops. Many more of the DVI recommendations are nearly identical to those presented in previous sections of this report. These include more rational management of TIF Funds, making existing and future streets more pedestrian friendly, and creation of a single, effective implementation agency to oversee all aspects of downtown development. The remainder of the recommendations contained in the DVI report possess their own merit, and are not repeated herein. However, the Task Force strongly supports its many thoughtful and important recommendations and commends it to the appropriate public and private bodies for consideration and implementation. The Arts Core Initiative During the latter stages of the Task Force’s activity, the Cultural Council of Greater Jacksonville and Downtown Vision, Inc. began a very focused study of potential downtown living and working space for artists. These two organizations engaged a consultant with extensive experience in arts and cultural districts in the downtown area of cities throughout the U.S. The Jacksonville artist survey was distributed to nearly 1,000 full-time artists, part-time artists and student artists, and received responses from 616 respondents, of whom 94% were individual artists. Among the important findings were: • 37% of artists are seeking live/work space. Of these, 79% are likely or very likely to rent or buy in downtown if units are available within the next three years. • There is already available vacant space in office and retail buildings which is convertible to living and working space for artists. • The area of greatest interest to the survey respondents was very similar to the arts district discussed above and in the DVI report: Laura Street on the west and Bay Street on the south, extending approximately four blocks east and north.


The Task Force strongly supports the continuation of this initiative, and believes its realization would complement its recommendation for revitalization of the eastern part of downtown, and would positively impact the Task Force’s recommendations for the study area. Additionally, it would rehabilitate empty buildings and put vacant properties back on the tax roll; provide a cultural identity to downtown that would encourage people to visit, live and work; provide an environment that would attract creative entrepreneurs, help business recruiting; and provide increased surrounding property values; and constitute a highly valuable cultural and economic development catalyst.


Section 6. Summary and Conclusions This section summarizes the most important and compelling recommendations developed in the preceding sections of this report. Many others, not listed below are essential to achieving the Task Force’s objectives, and their absence from this list should not be seen as trivializing them. In either case, most of them are general and directional in nature and will require further study and refinement. 1. Downtown development must occupy a renewed, and indeed foremost place in public policy thought and action. It must be given highest priority as an urgent matter of civic importance, upon which the entire city of Jacksonville depends for its long-term vitality and prosperity. 2. All Jacksonville citizens must be made aware and appreciative of the importance of downtown to their personal prosperity and enjoyments. Those living in the suburbs must understand the economic and intangible roles which downtown plays in their lives, welfare, and prosperity. 3. A strong, independent, well-funded but transparent and accountable implementation agency must be created for exclusive focus upon downtown development. Downtown activities, which are now scattered among various agencies and departments, should be centralized under the control of this entity. 4. Policy-makers must recognize the potential that exists for a grand, first tier future downtown that extends to and includes the sports complex and contains a thriving diversity of land uses, occupancy, activities, and amenities. 5. The crucial importance of downtown residential living must be recognized, reinforced, and implemented. No city our size has so few downtown residents. 6. A convention center should be created which is adjacent to a hotel, is located in downtown, has nearby retail and entertainment establishments, and contains


an adequate and appropriate combination of meeting, conference, ballroom and exhibition space. 7. The splendid riverfront site which our courthouse occupies at the eastern edge of downtown should be developed as a public/private partnership, to complement a convention center, to extend downtown activity eastward, and to be the springboard, the catalyst in development of the property extending to the sports complex. 8. Laura Street should become a prime north/south activity street of downtown. Retail, housing, dining, and a hotel should be developed. It should be an active, pedestrian-oriented, multi-faceted activity corridor that is the magnet for diverse downtown activity. Over time, other streets could evolve similarly. 9. The district generally east of Laura Street and north of Bay Street should be the focus of development for residential, dining and entertainment, retail, and artists’ galleries and studios. 10. In the east/west direction, the broad swath of downtown extending from the Times-Union Performing Arts Center to and beyond the redeveloped courthouse site should similarly be an active and cohesive band of important downtown venues and activities. 11. The issues of police presence, code enforcement, safety and security, cleanliness, and homeless persons must be more forcefully addressed. 12. Our elected leadership, and the citizenry in general, must be prepared to make significant financial investments in downtown. While economic circumstances do not permit doing so at this writing, additional sources of revenue must be seen as essential to the revitalization of downtown, which will return such investment many times over in economic, social and civic improvements.


13. The sources of funding for this set of investments are numerous, and should be carefully explored with a view toward fairness, effectiveness, and revenue production. All great cities have great downtowns. They achieve this status because of civic effort, sustained commitment, leadership both elected and unelected, and financial investment. Owing to recent external economic conditions and the longstanding policy of low cost and limited government services, our city has not achieved this status. But it can. It has natural and manmade resources which position it well but have not been fully taken advantage of. It is a low-tax city with the capacity to enhance civic investment without overburdening its taxpayers. It has a dedicated, high-quality citizenry who deserve to be residents not of the cheapest city in the south but of the best city in the south. The recommendations herein provide a clear and compelling blueprint for becoming just that. To continue past patterns, particularly in the area of revenue and investment, will result in continued decline to the detriment of our entire citizenry. On the other hand, investing resources in downtown will place Jacksonville and its urban core on a trajectory of economic, social, business and civic success.


Acknowledgements While producing this report was essentially a volunteer-driven effort, the Task Force received valuable assistance in certain commercial and technical areas. In particular, the Task Force would like to thank the following individuals and firms for their important and voluntarily rendered assistance: • Florida Times-Union reporters David Hunt, Jeff Brumley and David Bauerlein met with the Task Force to share their insights into downtown development activities in other cities. These journalists had produced an in-depth series entitled Downtown Dilemma which was published in the Times-Union in December 2009, and shared their valuable research with the Task Force. • John Kaatz of the consulting firm CS&L Consultants, which had developed a report regarding a convention center for Jacksonville in 1997, met with the Task Force to provide additional, current information and insights regarding convention center size, location and characteristics. • Architects from The Haskell Company and Reynolds, Smith & Hills developed conceptual plans for a convention center and related features which are described in Section 2 and depicted in Exhibit A. • Downtown Vision, Inc. and its Executive Director, Terry Lorince very generously shared background information and current data regarding core downtown issues. • Ben Carter and Ben Carter Properties, Atlanta real estate developers with extensive Jacksonville experience, provided advice and specific recommendations regarding the Courthouse block and entertainment park. Carter also facilitated discussions with PARC Properties regarding the entertainment park. • Terry Stiles of Stiles Corporation in Fort Lauderdale and Granville Tracy of American Land Ventures of Miami met with the Task Force and provided 38

valuable insights into successful downtown developments in their respective cities. • The engineering and land planning firm of England-Thims and Miller provided technical information and graphics depicting the Task Force’s recommendations for land use, and produced Exhibit C. • A group of students at the Florida Coastal School of Law prepared a white paper for the Task Force which examined the history of downtown development governance in our city, especially the roles played by the various incarnations of the former Downtown Development Authority. The Task Force believes that its work was both facilitated and enhanced by the valuable contributions which these individuals and firms made, all on a pro bono basis, and extends its deep thanks to them.


Sign up to vote on this title
UsefulNot useful