Commission agrees to staff suggestion about using interest from the county’s Economic Incentive Fund to make $1.4 million available for new and improved infrastructure projects
Last year, the Sarasota County Commission revived a county program as a de facto replacement for the Downtown Sarasota Community Redevelopment Area (CRA) initiative with which it participated for 30 years with the City of Sarasota.
This year, it has decided to almost triple the funding available through the Community Reinvestment Program (CRP) for municipalities — and county departments — to improve or create new infrastructure.
After county staff this week proposed a new source of funds for the CRP, the commission promptly and unanimously upped the ante, so to speak. Instead of taking just $250,000 in interest earnings from the county’s Economic Development Incentive Fund for the CRP this fiscal year, the County Commission authorized staff on Aug. 22 to take more than $900,000 out of that account to add to the $500,000 that will roll over into the CRP for the 2017 fiscal year. As Commissioner Carolyn Mason put it, “[Take] whatever the amount is” in interest earnings in that incentives fund.
The vote creates a pool of more than $1.4 million for the CRP as of Oct. 1, when the new fiscal year begins.
On Sept. 20, the board will vote on a resolution that would make the new funding source a permanent part of the CRP.
Lisa Damschroder, the economic development coordinator in the county’s Office of Business and Economic Development, explained that the CRP was established in May 2006 to provide a mechanism for county participation in redevelopment activities; it gave the county flexibility on how and where public funds were allocated. The CRP was suspended in the 2008 fiscal year, but the board brought it back in 2015 through an amended ordinance that revised the eligibility criteria for projects and investment. Municipalities in the county — and the county itself — could apply for funding for the acquisition of real property; the design, preparation and construction of public improvements; and the renovation, redesign or alteration of existing public facilities or public improvements.
To be eligible for funds, a project had to be planned to preserve and strengthen an existing community; promote one or more sustainable growth goals; provide an economic stimulus to the community; and leverage funding from other public and private sources, Damschroder explained.
The $500,000 allocated to the CRP in the current fiscal year budget came from the county’s Housing and Community Development Fund, she added.
Staff in the Office of Business and Economic Development worked with the staff of the county’s Office of Financial Management to find a new source of money to add to the program for the 2017 fiscal year, Damschroder continued. That was when staff began focusing on the interest accumulated in the Economic Development Incentive Fund, because it could be a potential source of revenue outside the General Fund. However, the CRP’s guidelines would have to be modified to permit that funding stream, she added. The revised ordinance also would specify that certain special projects — similar to the Precision Machining Program the County Commission helped establish at Suncoast Technical College and the University of Florida’s Innovation Station — could be considered for funding.
As staff put it in a PowerPoint presentation to the commission, those projects would “[p]rovide other unique economic development opportunities that will benefit the community” and “[a]dvance the efforts to diversify the County’s economic base.”
Staff already had discussed the proposal with representatives of the Chambers of Commerce of North Port, Venice and Sarasota, Damschroder noted, as well as the Economic Development Corp. of Sarasota County. “All of them have supported the recommendation,” she added, and some have provided letters stating that fact. Staff also plans to discuss the proposal with representatives of the Manatee/Sarasota Building Industry Association and the Coalition of Business Associations (COBA), she said.
When Commissioner Christine Robinson asked whether the Gulf Coast Builders Exchange would be included in the outreach efforts, Damschroder replied that it would.
Robinson pointed out that she worked with many of those organizations in 2012 to strengthen the county’s business incentives program. Therefore, she wanted to make certain that all of them were in agreement on this change in the use of interest accruing in that fund.
Vice Chair Paul Caragiulo asked whether the County Commission could be perceived as fair if it were weighing projects proposed by municipalities against one from the county. Would it lead to a more “toxic environment” between the county and the cities?
In the past, Damschroder explained, the County Commission considered concurrent requests from the Cities of North Port and Venice along with those designed for unincorporated Sarasota County. In such cases, she said, “we were able to spread the funding,” so all eligible programs received some of the money.
“That satisfies my curiosity for the moment,” he replied.
“The ordinance as currently written actually favors the municipalities,” Robinson pointed out, noting the likelihood was much greater that a proposal brought forward by a municipality would be able to leverage other funding than one submitted by county staff.
Then Commissioner Mason said, “I’d like to know from you, my colleagues, if there’s any appetite to increase the $250,000 to $500,000 from interest earnings.”
“I would love to do that,” Robinson replied.
In response to a follow-up question from Mason, County Administrator Tom Harmer said he believed the Economic Incentive Fund has about $900,000 in accumulated interest.
“Is that money earmarked for something else?” Robinson asked.
“Not currently,” replied Assistant County Administrator and Chief Financial Management Officer Steve Botelho.
Her recollection, Robinson said, is that the 2012 revision of the Economic Incentive Fund ordinance allowed for “extraordinary projects” to be considered for allocations. Since then, she continued, the Innovation Station has been the only one to win a commission grant from the fund. “I would think that infrastructure is an important aspect of economic development,” Robinson added. Therefore, she felt it would be appropriate to transfer the $900,000 in interest to the CRP. That “makes [the program] more enticing [to municipalities].”
“I think it sends a much stronger message … to folks” that the county wants to engage them in projects, Chair Al Maio said.
“I think it is an outstanding tool, namely an olive branch to extend to our cities and further strengthen our relationship with them,” Mason pointed out.
What always bothered him about the CRA, Commissioner Charles Hines said, “was the incredible amount of operating expense [it incurred] versus building things.” He agreed that if the board just added $250,000 to the $500,000 rollover for the next fiscal year, and kept adding $250,000 on an annual basis, the CRP fund never would grow to a level that would make the program attractive to municipalities. “Now, we suddenly start to say we are committed to this.”
When Harmer then pointed out that the amount of interest earnings changes regularly, Mason suggested the total be allocated to the CRP.
Harmer replied that staff could deal with that during the budget process each year.
Then, on Mason’s motion, the board unanimously voted to have staff come back on Sept. 20 with a draft resolution allowing all the interest earnings to be use for the CRP and special economic development projects.