UPDATED: MARCH 26, 2017 10:34 PM — Two new bills under review in Tallahassee could phase out Community Redevelopment Agencies (CRAs) statewide, potentially cutting off millions of dollars in Greater Orlando that have been used by local governments to aid small businesses, attract corporate relocations and finance urban redevelopment.
House Bill 13 would ban CRAs from beginning any new projects or debt after Oct. 1 and would disband all CRAs by 2037, while Senate Bill 1770 would also terminate all CRAs by 2037, and would only allow creation of new CRAs by a super-majority vote of a city or county.
Both bill proposals are still working their way through committee review. State legislators that see CRAs as wasteful, or a layer of government lacking accountability, are citing a case in Miami-Dade County from last year where a grand jury reported conflicts of interest in some CRA deals.
But the impact of such legislation would be a massive blow to local cities and counties that have used CRAs to help redevelop blighted real estate, local officials say.
"We have so many success stories of how Winter Park's CRA has helped revitalize areas that are now highly valued, like Park Avenue and Hannibal Square," Dori Stone, director of Planning and Community Development for the city, told GrowthSpotter on Thursday. "We brought Ruth's Chris (Ruth's Hospitality Group) headquarters to Winter Park (in 2011) in part with CRA funds. We've been able to show analytically how our business facade grant program has generated revenue growth for the small businesses it has helped."
CRAs aid development in blighted areas by reserving a set percentage of property tax revenue, which comes from increasing property values over time within a district and steering that to specific reinvestment. They can rely heavily on Tax Increment Financing (TIF) that provides specific public services, without levying new taxes.
CRAs come at no cost to the state, and are a strategic partnership between a county and cities in a targeted redevelopment area.
Other local cities like St. Cloud, Orlando, Winter Park, Ocoee, Apopka and more have active CRAs that are collecting incremental tax growth within a defined boundary, for use on social and property redevelopment programs.
Winter Park's CRA covers one square mile that includes its Central Business District, historic Hannibal Square neighborhood and westward to U.S. 17-92 (N. Orlando Avenue).
The city's CRA has spent more than $31 million between 2002 and 2015 on social programs and public events, business micro-loans and facade renovation grants for small business owners, affordable housing programs and related land acquisition, streetscape improvement projects, parking improvements and commuter rail matching grants, among other investments.
Orlando's Downtown CRA covers 1,664 acres that include most of Parramore. In the past three years since City Commissioner Regina Hill (Dist. 5) has been in office representing that area, CRA-funded grants have helped start 18 small minority-owned businesses, and revitalized dozens of buildings with facade grants, she said.
And last week, Orlando announced a Request for Proposals (RFP) for contractors to help build single-family homes on 10 city-owned lots in Parramore, a potential $1.8 million investment of CRA funds.
Hill was in Tallahassee on Friday speaking to state representatives and senators about the two CRA bills, and said she left hopeful that they won't be passed in their current forms.
"I think these two bills as written now will not move forward," she said. "This legislation will be very detrimental for our inner cities, and the many projects we have in the works for affordable housing and economic devleopment in blighted areas."
A city could still try to fund large and long-term redevelopment projects, but without a CRA such projects would have to be reapproved by a city council each year during budget votes, and risk losing favor as council members cycle out.
The HB-13 bill would also not allow CRAs to spend incremental tax revenue on new projects after this year, limiting most CRAs to little more than debt servicing.