Downtown dealing at 'starting point'

A draft of terms between the city and developers bidding to redevelop downtown is drawn up, but negotiations are just beginning.

By CHRISTINA HEADRICK

© St. Petersburg Times, published May 5, 2000

CLEARWATER -- The four-page document has "DRAFT" stamped on it three times on every page. But past the typos, the pages amount to the first glimpse of a deal city officials are negotiating with West Palm Beach-based developers to revive downtown.

The crux of it is that the developers want very inexpensive leases of city land overlooking Clearwater Harbor to help subsidize millions of dollars in redevelopment projects such as a movie theater and up to 1,200 new residential units at several downtown sites.

The developers are willing to bear the financial risks of building public improvements, such as an expanded waterfront park.

But the details are changing by the hour.

The early draft of the proposal, obtained by the Times on Thursday morning, says the developers want 99-year, $1-a-year leases for city land beneath the main library, Harborview Center and City Hall. They also desire similar leases for a downtown parking lot at Station Square, a section of the old Memorial Causeway bridge to use as a pier, and a chunk of parkland near the library for a restaurant, according to the draft.

By midafternoon Thursday, those terms shifted.

Charles Siemon, the attorney negotiating for the city, said the city is talking to the developers about a deal in which the city gets a share of profits from projects built on the leased city lands, with rent starting after several decades, Siemon said.

"It was intended to be a starting point," Siemon said of the early draft of the deal with the developers. "The only way that it can represent a decision by the city is when it goes before the City Commission. Ultimately, they (commissioners) have to make the decision."

Commissioners are expected to vote on the proposal May 18. Then residents get the final say in a July 11 referendum.

West Palm Beach developer George de Guardiola declined to comment in detail on the proposed deal.

De Guardiola said he is flexible on things such as the length of the lease for the city's lands. And he confirmed the gist of the arrangement: The city would use some of its land overlooking Clearwater Harbor to boost redevelopment throughout downtown.

De Guardiola has been negotiating to acquire millions in private property downtown, where he and fellow developer David Frisbie are planning new shops, apartments and other projects.

"We have consistently said we require the city's land to be at a nominal fee, because we will be forced to pay such an amount for the private sector land," de Guardiola said. "If the city is looking for the same price for their land that the private sector is looking for, well, we're going home."

Other points of the proposed downtown agreement include:

The developers would be required to build at least 1,200 housing units downtown, a multiscreen cinema, restaurants and a hotel with meeting facilities.

The developers would have to build an expanded waterfront park, a decorative walkway just south of Osceola Avenue, beautification projects on Cleveland Street and a botanical garden on the waterfront. They would turn the Memorial Causeway bridge (scheduled to be rebuilt to the south) into a pier.

The developers would have to build a "civic space" project, adjacent to a new main library building, which would have room for a new City Hall and perhaps 10,000 square feet in community meeting space. The facility would be at the top of the city's waterfront bluff near the existing library.

The city would agree to borrow money to issue bonds at interest rates favorable to government. Then the developers would use the money to pay for downtown projects. The developers would guarantee to repay the bonds in two ways: with revenues generated from their projects or with new property taxes coming from downtown redevelopment. If the revenues to repay the bonds did not materialize, the developers would be on the hook to pay back the debt -- not the city.

The city would pay the developers $2-million in Penny-for-Pinellas sales tax revenues for building an expanded bayfront park.

The developers would be responsible for providing adequate parking for their projects, as well as for the new main library.

The city could create special property tax assessments to pay for unspecified projects, perhaps a new concert amphitheater or a botanical garden.

Not included in the skeletal draft of the deal are such provisions as deadlines to complete projects and default provisions for the city or the developers to break the agreement.

City commissioners have yet to debate the deal.

"I'll study it very close, and underline a lot of things," said Commissioner J.B. Johnson. "I'm not going to approve anything that burdens the taxpayers of the city of Clearwater, I'll tell you that right now."

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