City has yet to live up to its 'Challenge'

Four years after Mayor Fischer promised economic help for neighborhoods south of Tropicana Field, little progress has been made.

By LEONORA LaPETER and BRYAN GILMER

© St. Petersburg Times, published October 23, 2000

ST. PETERSBURG -- In the weeks after arsonists and looters ran through poor neighborhoods south of Tropicana Field, Mayor David Fischer promised that an economic revitalization of those troubled streets was on the way.

As the fourth anniversary of that violence approaches, Fischer and the city's economic development director say they have "planted seeds."

Little has grown:

Though it promised to help create 2,500 or more jobs for low-income residents by 2001, the city's most optimistic estimates now peg the number of jobs created at 1,500. That figure is inflated by at least 800 jobs: About 500 are part-time selling concessions for the Tampa Bay Devil Rays and 300 more are outside the targeted neighborhoods.

In a time of extraordinary national economic expansion, the city tried to recruit employers to the troubled area but focused on two companies that were never viable prospects.

Rick Mussett, St. Petersburg's administrator in charge of economic development, spends much of his time in meetings with his staff and Fischer, according to a review of his 2000 calendar. When asked why he had no appointments with corporate relocation prospects, Mussett, who makes $108,000 a year, said he doesn't write them in his calendar.

The city touts its efforts to relocate a large employer to the edge of the target area this year. But the former chief of Ceridian Benefits Services said the city did not lobby the firm to choose the site. City officials read in the newspaper that the company was buying the building.

It took two years after the disturbances for the city to open the Business Development Center in the back of the Bethel Community Baptist Church. In the two years it has been open, the center has helped start or expand just seven businesses inside what the city calls "the Challenge" area. Two of those have closed.

Fischer said he now believes economic prosperity throughout the city is the best way to help residents of the troubled neighborhoods. He points to the soon-to-open downtown BayWalk shopping area and growth in far north St. Petersburg as reasons for hope.

"It's going to trickle down," Fischer said.

Neighborhood leaders are frustrated.

"No, they're not committed to this area," said Rodney Bennett, a local resident who is chairman of the state's community-led effort to improve the area. "We have a mayor who's talking about economic development, but how many businesses or real economic development opportunities have they assisted with? How long has it been since the riots?"

It was Oct. 24, 1996, when St. Petersburg made national news after a white police officer shot and killed a black teen during a traffic stop.

Nearby neighborhoods, hidden neglected between Fourth and 34th streets S, just south of downtown, boiled over. Among other things, residents were angry about living in poverty while the city's other neighborhoods prospered. For two nights, arson and looting were common. Police were pelted with rocks and bottles.

In March 1997, Fischer announced his Challenge 2001 effort, with a main goal of improving economic conditions in those neighborhoods.

But in a series of interviews over the past month, Mussett tried to lower expectations. It took the city 20 years, he said, to spark development in the Gateway section of northern St. Petersburg and even longer downtown.

And Fischer this year renamed his revitalization effort simply "the Challenge," an admission that the work will be far from done in March when his mayoral term ends.

The progress made by Mussett's staff has come slowly:

Mussett says the neighborhoods are short of vacant land for development, so the city is trying to assemble a 20-acre piece of property in a decrepit industrial district at Fifth Avenue S and 22nd Street to clear and sell to an employer. Four years after the disturbances, the city just started buying the first lots.

And the greatest economic development success south of Central Avenue appears to have happened largely without Mussett's help.

Mussett boasted about Ceridian Benefits Services' decision to move to the former Florida Power Building, just outside the Challenge area on 34th Street S. The company moved from Palm Harbor in April.

But Jim MacDougald, the former CEO of the company that became Ceridian Benefits, said that while he found city officials impressively welcoming and helpful after he had decided to move, they had nothing to do with the company's decision to locate in St. Petersburg or near the Challenge area.

A commercial real estate firm helped the company find the site.

Fischer insists his Challenge program is working to improve the troubled neighborhoods in other ways. But the progress on the non-economic goals of the Challenge effort has come slowly, too.

Fischer pointed out that the city is using sales tax revenue to build a $3.5-million recreation center in the Wildwood neighborhood. It is planning a $2.68-million library next to the Enoch Davis Center at 1111 18th Ave. S. and a $1.43-million pool in Childs Park. All are in the Challenge area.

But each project was being considered in some form before the 1996 disturbances.

Manufacturing failures

The city has made two major attempts in four years to attract companies to the Challenge area. But rather than chasing established companies or growing firms, Mussett and his staff focused on two out-of-state companies with questionable futures.

Mussett's staff spent almost two years pursuing the minority-run Washington-Harris mail-order pharmacy, even securing conditional approval for a $6.25-million loan from the U.S. Department of Housing and Urban Development.

The Maryland company promised to employ hundreds. It turned out not to have the federal contracts it talked about or any money of its own to put on the table.

"Washington-Harris was not an existing business," Mussett said of his decision to pursue the company. "We built a lot of time and energy into making that happen."

At the request of the St. Petersburg Area Black Chamber of Commerce, Mussett's staff next turned its attention to Madame C.J. Walker Enterprises, which makes cosmetics marketed to ethnic women, and spent 14 months talking with that business.

In the process, staffers lost documents. They didn't return phone calls. They asked for the same information twice. But the biggest lapse? They neglected to determine something that should have become obvious pretty fast: The company was not financially strong enough to move here anyway.

The company brought in just $2,506 in revenues in 1997, less than one woman selling Mary Kay cosmetics could sell part-time. Company leaders wanted the city to help it get a $1-million grant from HUD and a $2.1-million line of credit to build a plant here and expand manufacturing to lotions and makeup.

Former Economic Development Director Joe Johnson, who resigned to take a job in Georgia last June, said he was looking for private individuals to invest in the historic company. He said he liked the firm because it offered a potential companion museum with artifacts from the 89-year-old company's early days.

Mussett's self-starters

Mussett knew little about the status of Madame C.J. Walker when asked recently.

"I'm not the one to talk to about Madame C.J. Walker," Mussett said. "I just haven't had much involvement with it at all."

Mussett said he gave Johnson leeway to handle that project.

"I don't treat my departments like puppets on a string," he said. "They get paid good salaries and they are expected to take whatever prospects and explore them."

Mussett's appointment calendar shows that his days are largely spent meeting with the staff or Fischer or without appointments.

Though state law gives governments the right to black out the names of economic development prospects when releasing public records, Mussett's calendar for January through August of this year contains no such deletions. Mussett said he talks with two to five prospects a month, but he intentionally doesn't list them in his calendar to give them confidentiality.

Even though economic development in the Challenge area is considered a top priority under Fischer's administration, just 14 of the 230 people Mussett supervises have economic development as their primary mission, and they serve the whole city.

Four of those employees have resigned over the past year, and two of the jobs, including Johnson's old director slot, are still vacant. Fischer attributes the resignations to a booming job market. But two of those four, including Johnson, left for other government jobs.

Even before the resignations, Johnson thought the department was understaffed. The city is about to add two people to the Business Development Center, something Johnson was denied in the two years before he left.

But the city cut a position from the economic development department to save $52,000 and help balance the budget after the City Council decided to reduce the tax rate this past month.

Mussett and Fischer said their economic development plan for the city has always focused more on keeping businesses here than on bringing in new ones. The city contracts with the St. Petersburg Area Chamber of Commerce to help keep businesses, too.

"Eighty percent of growth comes from the existing business community," Mussett said.

In Tampa, Mayor Dick Greco and Mussett's Tampa counterpart, Fernando Noriega, can be seen squiring corporate relocation prospects around town about twice a month in the black Lincoln Town Car that Noriega calls "the Batmobile."

Greco, who has worked as a real estate developer in the private sector, has helped make Tampa's one of the fastest growing economies in Florida. He has helped bring millions of dollars in investment to Ybor City.

Fischer says that's not the way corporate relocations are done anymore. Commercial Realtors and the like negotiate the deals without city help, like Ceridian did. They want confidentiality the city cannot provide, he said.

Partly for this reason, Tampa and Hillsborough County contract with the Tampa Area Chamber of Commerce to conduct business recruitment activities. They harness the networking connections of the city's heaviest hitters and send Greco and Noriega in to close the most promising deals.

"If they are interested in one neighborhood, we will tour them through the whole city," to make sure another site might not be a better fit, Noriega said, although they too are sometimes criticized for neglecting the city's poorest neighborhoods. "The mayor and myself make it our business that they understand the total picture of what's happening."

Fuzzy numbers

The city pledged to create 2,500 jobs by 2001 for residents in the Challenge area. Today, officials claim to have created 1,500 new jobs., but few have been created in the Challenge area, and fewer still were the result of any special effort by Mussett, Fischer or other city leaders. More than 300 of those jobs were at businesses far from the Challenge area, including a staffing company in Tampa. The city counts graduates of local training programs, some that the city had nothing to do with, as another 365 "new jobs."

An additional 500 of the 1,500 jobs are real, but they are low-paying seasonal jobs, such as selling peanuts at Tropicana Field, clearly not the kind of jobs that will support a family.

"They can tweak the numbers any way they want, but people don't eat six months out of the year," said the Rev. Manuel Sykes of Bethel Community Baptist Church on 16th Street S. "They eat every day of the year."

Fischer said the jobs might provide a supplemental income.

And while St. Petersburg built the dome and fought to attract baseball, those jobs were on their way before the disturbances. The Devil Rays got a baseball franchise in 1995, more than a year before the disturbances and two years before Fischer issued his call for job creation.

The city's numbers are questionable in other ways.

For example, the city claims it worked to help keep Bama Sea Products in town and to expand by 80 jobs in a new plant in the Challenge area.

John Jackson, senior vice president of operations at Bama Sea Products, disagrees.

"We were already in the area for 25 years, all of our employees were from around here, so we lucked out and found this facility," Jackson said. "Basically the city hasn't done anything to discourage us or encourage us."

In another case, the city said it helped create eight jobs at two printing shops in the Challenge area. One of the businesses, Banyan Printing, said the city's help in obtaining tax cuts through its enterprise zone certification was a failure. It has since moved out of the Challenge area.

The other company, Thunder Graphics & Printing, went bankrupt after getting a $40,000 loan from the city. (See related story.)

Changing approach

Professor Jerry Kolo, director of Florida Atlantic University's Center for Urban Redevelopment and Empowerment, thinks Fischer and his staff have taken the wrong approach to bringing prosperity to the inner city.

"If you have the political leadership at the forefront of plans, you always end up with politicized plans," Kolo said. "What you have in St. Petersburg is that kind of politicized plan. It's a Band-Aid."

The root cause of urban poverty, Kolo argued, is "the limited capacity of people to participate in the local and regional economies." Some cities build factories or hotels in impoverished areas to create jobs, only to find that outsiders commute in to take the jobs. The locals simply do not have the skills.

Kolo said cities need to focus on putting neighborhood residents in touch with employers and making sure they have the skills. He said most people in poverty need to work for someone else for years before starting their own small business.

"I think management skills, organizational skills and personnel skills are more important than capital in starting and running small businesses," Kolo said, explaining why business loans don't help most residents. "There's no quantum leap. There's no shortcut."

Often, unemployed residents of the Challenge area lack the training they need to get such a job or are unsure how to go about applying for one, Fischer agreed. The city has worked to host job fairs in the neighborhood to match employers and those residents, he said.

Fischer said he thinks Pinellas County schools in southern St. Petersburg will turn out a better-qualified work force after a planned multimillion-dollar investment in neighborhood school buildings.

The mayor, who has told several people that he will seek re-election in March but declined to make a formal announcement, said his Challenge program is a pioneering effort, and he expects to run into difficulties that will require change along the way.

But some think he has already wasted crucial time. Sykes, the church leader, said the only visible signs of change inside the Challenge area are new trees and curb cuts.

"I think Mayor Fischer has shown he has ideas," Sykes said. "I don't think he's pushed them. He's not demanded and said, "I want this done yesterday.' There are certain things you can do if you're a strong mayor. You've got to say you're not going to allow inequity and poverty to happen in one pocket of this city."

- Bryan Gilmer can be reached at (727) 893-8848 or gilmer@sptimes.com. Leonora LaPeter can be reached at (727) 893-8640 or lapeter@sptimes.com.

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