MEMORANDUM
TO: Local Planning Agency
FROM: Carol Cunningham
DATE: September 3, 1996
SUBJECT: Option to Create a CRA
As a part of the preparation of a comprehensive plan for the Town of Fort Myers Beach, the Local Planning Agency will need to explore the potential of various implementation mechanisms which may be used to achieve comprehensive plan goals. The Town has already made substantial progress in planning for the revitalization of the downtown district through many years of community interaction, the activities of the Estero Island CRA, and most recently through the application for designation of the downtown as a Florida Main Street area. The purpose of this memo is to provide an overview of the proposed activities of the Main Street/DRA concept, of the steps necessary to establish a DRA and tax increment trust fund, and to identify the differences between the proposed Downtown Redevelopment Authority and the former Estero Island CRA.
Overview of the Main Street/DRA Concept
According to the recently approved Main Street Program application, the Town is considering establishing a Downtown Redevelopment Authority (DRA) which would replace the functions of the Estero Island CRA, originally part of the Lee County Community Redevelopment Agency. Initially, the Main Street program will be implemented through a joint venture between the Town and the Chamber of Commerce. The proposed next step is to form a DRA which would carry out the participation in the Main Street Program and the continued revitalization of the downtown area of Fort Myers Beach over the long term. Statutorily, there is no difference between a CRA and a DRA. The distinction is in the name, which indicates its boundary and focus, and in how the entity is used.
The combination of the Main Street program with the organizational structure and statutory powers of community redevelopment provides an effective set of tools to coordinate participation, implement desired public improvements, and stimulate appropriate private sector reinvestment in the Town's downtown district.
The Main Street designation brings with it extensive technical assistance, particularly in marketing and in planning for preservation and revitalization, and, in addition to an initial $10,000 grant, brings assistance in securing funding sources and an advantage in applying for state grant funds. The Main Street program has a proven formula for making things work and an extensive statewide and national network for support to the Town's efforts. The Main Street program can be seen as the catalyst and the technical resource for revitalization of the downtown district.
Community redevelopment (a DRA) brings with it many forms of assistance which can be used to further the process of revitalization including site assembly, relaxed regulatory requirements, expedited plan review, installation of public facilities, and tax exempt project financing. Furthermore, a DRA may assemble property (through purchase or eminent domain) for re-sale, joint venture, or lease for private development; whereas, a municipality may only utilize eminent domain in property assembly for an explicit public purpose.
A DRA can be seen as the on-going organizational entity that coordinates and targets the activity and resources of numerous organizations as their respective activities contribute the revitalization of the downtown district. The list of organizations involved in bringing new vitality to the downtown district includes (but is not limited to) the Town of Fort Myers Beach, the Chamber of Commerce, Times Square Merchants Association, Fort Myers Beach Board of Realtors, Estero Island Historic Society, Concerned Citizens, Kiwanis, and others with a desire to participate. A DRA can also be seen as the entity through which a variety of funding sources can be obtained, layered, and targeted to maximize effectiveness of investment expenditures. Such funding sources include tax increment, CDBG money, other state and federal grant money, and funds from private lending institutions.
The application for the Main Street designation describes the proposed roles and activities as follows:
Forming a Community Redevelopment Agency
The Florida Statutes Chapter 163 Part III address community redevelopment and state that when the governing body (the Town Council) makes the proper findings of necessity (blight findings) for redevelopment within a specified area (redevelopment area boundaries) and further finds the need for a community redevelopment agency to function in the municipality to carry out the community redevelopment purposes of the statutes, the municipality may, by resolution, designate itself as the CRA, or by ordinance create a separate CRA.
The Statutes do not make a distinction between the terms "community redevelopment" and "downtown redevelopment", or between the terms "agency" or "authority". The agency formed according to the Statutes may be called something else (such as Downtown Redevelopment Authority) but in fact has the same powers and responsibilities as a CRA.
It should be noted that with incorporation of the Town, the Estero Island CRA has been dissolved as a part of the Lee County Community Redevelopment Agency and is no longer a part of their trust fund or collecting TIF. The remaining activities of the Local Redevelopment Planning Committee overseeing the Times Square improvement project are continuing only as specified by interlocal agreement between the Town and the County. In order to utilize community redevelopment as a continuing program, the Town must establish a new agency, new boundaries, update and revise blight findings for the specified boundary, prepare a plan that pertains to the new boundaries, establish a new trust fund, and new base year for collection of tax increment.
The following summarizes the remaining steps necessary to initiate redevelopment activity and the collection of tax increment funds:
The Town Council creates the Redevelopment Trust Fund by ordinance which also must provide for the funding of the Redevelopment Trust Fund for the duration of the redevelopment plan. The ordinance further establishes the base level of aggregate assessed values within the redevelopment area for tax increment purposes at the level of the most recent assessment roll used for the taxation of real property in the redevelopment area prior to the effective date of the ordinance (in order to capture the increment for the year beginning January 1997, the ordinance freezing the tax base must be adopted prior to June 30, 1997.
Tax Increment
The amount of the increment is determined annually as follows: Current assessed value minus base assessed value = increase in value. Increase in value multiplied by current millage rate = tax increment increase which is then multiplied by 95% to result in the required tax increment appropriation.
Each "taxing authority" must annually appropriate an amount no less than the increment revenues calculated for its millage rate and deposit it in the Redevelopment Trust Fund with payment due October 1 of each year. The Fire District and the School District are exempt from this requirement. Taxing authorities which must meet this requirement (meaning they must make contributions into the DRA's trust fund) include such entities as the Town of Fort Myers Beach, Lee County, the Mosquito Control District and others as identified.
Difference Between Former CRA and Proposed DRA
The major distinctions between the former CRA and the proposed DRA relate to how the entity is structured, the redevelopment area boundaries, and the focus for redevelopment activity.
The Estero Island CRA was one of several component redevelopment areas encompassed under the umbrella organization of the Lee County CRA. The Estero Island CRA and each of the other component redevelopment areas had their own local redevelopment committee that provided guidance to their respective representatives to the CRA Advisory Committee for all the areas. The CRA Advisory Committee made recommendations to the decisionmaking body, the CRA Board which was also the Lee County Board of County Commissioners. Now that Fort Myers Beach is incorporated, this extra layer of advisory committees is removed, providing the opportunity for more direct communication and accountability between the community and the decisionmakers in carrying out the program.
The DRA could be structured in a variety of ways. The Town Council could appoint itself the community redevelopment agency board or appoint a separate body of commissioners as the agency. The agency could be structured with or without an advisory committee. The Executive Director of the agency could be the Town Manager or someone else. The agency could provide its own staff or contract out its staff functions to some other entity.
The boundaries of the Estero Island CRA included the entire Island. Presumably, the DRA boundaries would encompass an area defined as the "downtown" and would include the Times Square area and a defined portion of the surrounding commercial areas. Redevelopment activity exercised by the community redevelopment agency are limited to within the boundaries of the community redevelopment area.
Similarly the Redevelopment Trust Fund is funded by tax increment of real property contained within the geographic boundaries of the community redevelopment area. So where the Estero Island CRA tax increment fund drew from the entire Island and could be reinvested according to plan priorities anywhere within the boundaries of the entire Island, the proposed DRA tax increment fund would capture the tax increment only from within its defined boundaries and its reinvestment would be limited to within those defined boundaries.
Conclusion
In preparing policies for the comprehensive plan for the Town of Fort Myers Beach, the LPA will want to consider the potential of community redevelopment as an implementation tool which, particularly when linked with other programs such as the Main Street program, and with other funding sources such as CDBG, can provide resources for catalyst investments to trigger or "seed" desired revitalization and preservation projects. Successful and timely revitalization of the downtown according to an adopted plan which reflects the Town's vision will have multiplier impacts upon the revenues and resources available to the entire Town for implementation of capital projects throughout the Island to broadly implement the Town's vision as defined through the comprehensive plan.