You can excuse Palm Coast city officials for their relief lately–if not their eagerness– as they finally see Town Center begin to look a little more like the town it was intended to be. The eagerness was on display last week as city officials and developers broke ground on an apartment complex on Bulldog Drive.
It was on display again earlier this week–not in so many shovels, but in regulatory and map amendments as planners were seeking to expand the city’s so-called “Innovation District” and its incentives to developers to facilitate what may become a 90-home development in the northwest quadrant of Town Center, not far from Publix.
To make that possible though, the expansion of the district was tied to an elimination of certain size restrictions controlling development in the district. For example, single family units right now must be built on lot sizes of 50 feet or less, in part to encourage innovative, affordable housing concepts. The prospective developers may need 70 feet. There’s no actual proposal yet, but the city wants to be accommodating. It’s all part of what it calls its kick-start program, which expires in 2020.
“There is some verbiage in our initial kickstart program that had limited the types of residential projects that had come in,” Wynn Newingham, head of innovation and economic growth, told the city council Tuesday. “But now that we have this fluid use of multi-family, single-family, affordable housing, that we are moving the restrictions around what types of residential developments that would qualify for that program, just removing that verbiage to allow for additional projects to come in.”
To that end, the city is expected to update its “Community Redevelopment Plan” early next month, eliminating restrictions on residential sizes and types of residential development may be built in Town Center.
There was more caution than objection, and from just one council member: Bob Cuff, an attorney whose years of experience with ITT make him the council’s point man on land development. “Since this is supposed to be innovative housing and commercial development,” Cuff said, “I don’t want to incentivize 2,200-square foot, three-bedroom, single family homes with two car garage, I don’t think we need to incentivize those, certainly not in this area.”
The proposed rewording of the ordinance council members would be approving next week is explicitly, boundlessly permissive: it would be approving “the innovation kick start program’s expanded boundary and unrestricted lot sizes.” The elimination of the restriction would apply to all acreage in the innovation district, potentially making the city vulnerable to a developer’s demands that the lot sizes Cuff fears be accommodated.
Newingham did not speak of that sort of scenario. She said the accommodation planned for the new parcel to be added to the innovation district would be part of the larger mix that the district is spurring into existence: she’s holding out hope that the district will meet its goal of “incentivizing” 1,000 new residential units and 500,000 square feet of commercial space by the time it reaches its expiration date next year. That would be a substantial achievement in light of Town Center’s much dimmer history. But it is clearly predicated on the city making very generous concessions to developers–and continuing to do so as potential development plans are submitted.
The city’s eagerness is the product of a decade of dashed hopes.
Ever since it leveled nearly 1,600 acres of scrubland and created what became known as Town Center around 15 years ago, Palm Coast has dreamed of that rectangular expanse as the heart and soul of a city that had neither. The acreage was platted. Streets, sidewalks, parking spaces and trails were built, streetlights planted and lit every night like a vigil to an imminently bright future.
Instead, the housing market collapsed and the economy suffered its worst recession since the Depression. Town Center’s streets to nowhere became one of the recession’s most emblematic postcards. Aside from the brisk business of new shopping centers on the periphery and a few of errant buildings within, City Hall and its ill-timed plunder of capital dollars not least among them, little else happened. Not for several years. The original Town Center dream of 2,500 apartments, condos and town houses, 3.4 million square feet of commercial space and 1.4 million square feet of office space remained just that: a dream.
Then little by little earth stirred, with a couple of apartment complexes rising, the Palm Coast Arts Foundation’s grounds adding a more permanent soundtrack to the activity, until suddenly in the past year or so earth started not just stirring but shaking, with the nucleus of Town Center a construction zone: Last week developers and city officials broke ground at 470 Bulldog Drive for an 88-unit apartment complex called The Palms at Town Center, at the southeast corner of Central Avenue and Bulldog Drive.
Within a sparrow’s flight east of the movie theater, a much larger apartment complex that may total five buildings and 233 units is in preparation. It’ll likely be called The Venue. “And then we have some others in the works that we’re not at that place to share just yet,” Newingham said. Two projects, “nothing in concrete,” would be commercial.
The University of North Florida has its eyes on a Town Center campus. Not long ago city officials told Tom Gargiulo, the artist who’s leading the effort to create a sculpture garden in Central Park, to be prepared to rethink the location of some planned sculptures, to make room for expected development.
“With this new apartment complex and the promise of more development to follow soon, we’re on our way to making Town Center a hub for innovation, technology and growth,” Mayor Holland said at the Palms groundbreaking. “Our vision is clear: a mix of high-tech companies, amenity-rich residential areas, the park, cultural arts, coffee shops, entrepreneurs and retail in a walkable neighborhood with well-designed indoor and outdoor spaces.”
Town Center was created somewhat controversially in early 2004 as a so-called CRA, or community redevelopment agency. (Controversially, because the city stretched the definition of “blight” to suit its ambitions: there was barely any blight to speak of in a fraction of the acreage Palm Coast was largely withdrawing from the county’s tax rolls: well over $1 million a year in property taxes normally owed the county now remain in the CRA’s coffers.)
CRAs were intended to help cities with blighted neighborhood reinvigorate themselves economically by drawing a boundary around the CRA and ensuring that almost all property taxes generated within that boundary would remain in the zone, reinvested there to spur further development. The tax incentive was directed more at local governments than at businesses or developers, though businesses and developers could bank on operating in an area that presumably was benefiting from committed government investment in infrastructure and other amenities. It worked to a limited extent in Town Center: the zone certainly looked manicured, but it did not draw the number of developers the city was hoping for.
So the city created yet another incentive, this one targeted almost squarely at developers. It called much of Town Center its Innovation District, and set up the so-called Innovation Kick-Start Program, a new incentive within the original CRA. The heart of the incentive is the equivalent of a tax break (or a fee break), affecting impact fees, the one-time levy on developers that local governments use to defray the “impact” of development on roads, parks, water and sewer services, and so on. Developers in Town Center’s innovation districts may get a credit of $5,000 on utility impact fees for every 1,000 square foot of development. The incentive is capped at 500,000 square feet of commercial space or at 1,000 residential units, and it runs out in 2020.
It’s a lot of money to give away, a considerable subtraction from city revenue–or, more specifically, from revenue within the Town Center zone. But the subtracted revenue by way of incentives is itself intended to be a short-term reduction for long-term gain. For example, the 117 Brookhaven apartments built a few years ago (impact fees were deferred) added nearly $10 million in taxable value, increasing revenue to the CRA’s tax base by nearly $1,000 a year. By 2034, around the time when the CRA is to end, the city expects the complex alone to have added $1.73 million in revenue, to $14,775 per unit, or three times the value of current incentives. (That’s in current dollars, without taking property value appreciation into account.)
“We know The Palms at Town Center will serve as a catalyst for more development – to bring in more restaurants, retail and employers.”
But Town Center’s history is also a cautionary tale that may not have turned its last page: every project, including the movie theater and City Hall itself, has been termed a catalyst to the sort of development that would allow Town Center to live up to its name. Reality has not been as encouraging, though neither had been the number of real projects lining up for construction until the kick-start program.
Correction: Winn Newingham was mis-indentified, in an earlier version of this story, with an employee who no longer works with the city.