North Trail partnership looks at ‘informal’ TIF

No place else in town better demonstrates the wild contrasts of Sarasota. Ironies abound on the North Tamiami Trail – the home of an honors college, but also home to the community’s highest pockets of illiteracy; home to the wealthiest and the poorest residents in the city, separated by only a few hundred feet of geography.

For decades the redevelopment of “North Trail” has been a city priority. But on May 7, the city commissioners voted down a proposal to use a nationally recognized planning firm to help create a master concept for what many call the community’s gateway.

While North Trail Redevelopment Partnership Chairman Jay Patel called the 4-1 vote “disappointing,” his group was ready three days later to move ahead with other ideas.

Police have been active along the North Trail recently, making a score or more of drug and prostitution arrests. Patel and the partnership applauded that during their monthly meeting, but suggested the area could benefit from a dedicated police officer. “Downtown has five, and Newtown has five,” he noted. “We could use one of those, too.”

City commissioners and the police chief can expect some arm-twisting soon from Patel and his group, looking for the assignment of a beat cop who would come to know the merchants and residents on a first-name basis.

“We need a dedicated police presence on the North Trail,” said Patel. “Every time it’s a different person. We want to convince the police and the commission we need a dedicated presence.”

The ‘informal’ TIF

The organization is exploring new funding territory to pay for improvements. While downtown and Newtown share a Community Redevelopment Agency armed with cash from tax-increment financing (TIF), the North Trail has no exceptional funding vehicle. Patel and others are looking at what they called an “informal TIF district.”

A formal TIF district exploits the difference between tax revenue at a given date in the past (usually when the district was formed) and the current tax revenue. In the first year, the “increment” is small. But over the decades, it can grow into a significant pile of cash. Imagine the tax bill of downtown 25 years ago, and the tax bill today. The difference – the “increment” – is worth millions.

Patel’s idea of an “informal TIF district” calls for the city to set a date (not necessarily a current date), then devote the “increment” to North Trail purposes. This would avoid lengthy and risky negotiations with the Sarasota County commissioners, who would need to approve any “formal TIF district.”

“There is a lot of new development, and more is coming,” said Patel. “A lot of that is the result of behind-the-scenes work by this group to get these projects here. The Walmart, the Goodwill (Industries facility), the Tahiti Park project — all are going to add to the city’s tax base. We would ask the city to informally set aside that money.”

The city’s formal TIF district is set to expire in 2016. More than one county commissioner has expressed interest in regaining control of all of the money, which has grown to a significant “increment” over the past 26 years.

Another option could be a “business improvement district,” in which a specific area votes to increase its taxes for use in the district. St. Armands Circle, downtown around Main Street and Golden Gate Point in the past established BIDs to finance improvements. The formal TIF and BID structures can support municipal bonds, funding large projects quickly, then paying off the “loan” over time.

An “informal TIF district” would be forced into a “pay-as-you-go” operation because – without some fancy legal footwork in Sarasota City Hall – the informal TIF would not be “bondable.”

Patel said the group would move forward to investigate the idea of an “informal TIF district,” and that it would meet with the county property appraiser and the city’s finance director, among other officials, to flesh out the idea.