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Palm Coast Sets Special Meeting Tuesday to Consider Tax Breaks for Palm Harbor Shopping Center’s Redevelopment

| September 26, 2014

How Palm Harbor will become Island Walk.

How Palm Harbor will become Island Walk.

In an unusual move, the Palm Coast City Council set a special meeting immediately following Tuesday’s workshop to adopt two proposed measures: a tax-break package valued at $52,000 for the Palm Harbor shopping center redevelopment, and a $900,000 purchase of 21 vehicles for the city’s fleet.

The Flagler County Commission routinely holds meetings immediately after workshops to ratify by vote decisions reached during the workshop, when votes cannot be taken. The commission has occasionally been criticized for doing so, as the matters at hand have little time to be divulged and discussed in the community. The Palm Coast City Council has not held such meetings immediately after a workshop in the past several years, keeping to a schedule of alternating workshops and business meetings every Tuesday.

“We were already having a special meeting anyway, due to the cost savings on the white fleet purchase,” Cindi Lane, the city’s spokesperson, said. “So with Palm Harbor, this provided an opportunity for us to bring to council more quickly. It’s a complex and important project with a sensitive timeline.”

The incentive package for Palm Harbor Shopping Center was the result of would

Oakbrook, Ill.-based Inland American had owned the shopping center since 2009. The center had once been the heart of Palm Coast—indeed, its only commercial center, before the city’s incorporation. But it declined over the years as the city grew and its commercial center of gravity began shifting away from Palm Harbor. Not much was done to maintain the quality of the center, and tenants had difficulties preserving workable relationship with the landlord as rents and Common Area Maintenance fees were raised. Store after store went vacant. The property continued to decline. Last May Inland sold the strip mall to Branch Island Walk Associates, an Atlanta-based company, for $12.4 million.

The future Island Walk, as the development will be renamed, will be anchored by a larger, 54,000 square foot Publix, among a total of more than 220,000 square feet of retail space on 28.7 acres. The developer, Winter Park-based Michael Collard Properties, projects spending $40.8 million. It has big hopes—as does the city—of revitalizing the shopping center and bringing in new national tenants despite the difficulties other shopping centers have had doing that in the wake of the Great Recession. The rebuilding and reconfiguring of Island Walk is intended to create a new look and magnet for existing and new businesses. (Several existing businesses have moved to enable the reconstruction.)

“During review of the site plan and in consultation with the new owner, several issues were raised that put the redevelopment project in jeopardy,” background documentation for the city’s incentive proposal states. It’s not clear what those issues were. The city did not reply to an email inquiry. Beau Falgout, senior planner and the point man on the project, did not return a call Friday. “City staff was approached by the owner about possible incentives for redevelopment in order to keep the project moving forward,” the background documentation continues.

The incentives entail the city not imposing water and sewer impact fees on the developer, the one-time tax charged to builders to offset the cost of development. Local governments have water, sewer, parks, transportation, fire and schools impact fees. The developer of a single-family house in Palm Coast would pay roughly $15,000 in combined impact fees, a cost passed on to the home-buyer. Commercial developments pay more, depending on the size of the development. Island Walk would get a $52,000 break. It would also be eligible, according to the proposal, for a break on transportation impact fees. That figure is not yet known.

“Notwithstanding redevelopment,” city documents state, “the Palm Harbor Shopping Center could fall further into disrepair and become a source of blight, negatively impacting the City and surrounding neighborhoods. In addition, the redevelopment of the Palm Harbor Shopping Center will increase taxable sales, increase sales tax collections, and improve the conditions of the local economy and surrounding neighborhoods. For these reasons and for the public purpose of economic development, City staff is recommending approval” of the incentives.

Phase I of Island Walk, which includes the majority of small shop tenants, is expected to be completed next spring, according to the developer, followed by Phase II with Publix and additional small shop space by Fall 2015.  The final phase to the east of the new Publix is expected to be complete by mid 2016.

The council approved the purchase of vehicles as part of its coming budget. On Tuesday, council ,members will face three options on how to proceed with the purchase. Local car dealers were offered a chance to bid but they declined. Duval Ford, Allan Jay Chevrolet Cadillac, Inc., and Nextran Truck Center provided quotes to the city, which now proposes to buy the vehicles from all three dealers, though most of the vehicles would be bought from Duval Ford by piggybacking on a Florida Sheriff’s Association Contract. The piggybacking allows the city to buy vehicles at a lower rate.

Council members can choose to buy 2014 models on the current, 2013-14 Sheriff’s Association contract before prices increase, or they can wait for a new contract, after Oct. 1, for 2015 models. But in that case prices will most likely be higher.

The workshop discussing both matters, and other matters, begins at 9 a.m. at the city’s conference room at City Marketplace. It’s open to the public. The special meeting will immediately follow the workshop in the same place. But it’s impossible to know at what time the special meeting will begin. Workshops usually last several hours.


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13 Responses for “Palm Coast Sets Special Meeting Tuesday to Consider Tax Breaks for Palm Harbor Shopping Center’s Redevelopment”

  1. Floridiots says:

    So what help do I get, if as a residential property owner, I intentionally let my property fall into disrepair, then ask the City for help with improvements so I can rent it out? No corporate welfare. Look up the current owners – look like fund managers to me. No local ties, won’t care about tenants just like previous owner did. Please City Council members, don’t fall for this crap. And stop raising MY utility rate!

  2. Groot says:

    What happened to all the talk of a World Market, an LA Fitness, Joanne’s and all that? Maybe they checked out the local demographics and said, hey, the demos round here suck! I hope not. Stick a Whole Foods or Earth Fare in there so I don’t have to drive 54 miles each way once a month on our Whole Foods trek!

  3. YankeeExPat says:

    Once again a developer is rolling the city like a drunk in a cab. Then again this is nothing new as developers in Florida are like T.V. faith healers… send me your money and I will take all your pain away.
    “Praise the Lord, and don’t forget to endorse that check”!

  4. Origins of our cherished and beloved Palm Harbor Shopping Center within our Heritage and Historic CORE of ‘ The Palm Coast Project’.:

    By a Federal ORDER for Palm Coast – F.T.C. Docket C-2854 – ORDERING REDRESS for me and other early purchasers and benefit present Palm Coasters:

    United States of America
    Federal Trade Commission
    Washington, D.C.
    Date: September 20, 1991/October 4, 1991
    FROM Joseph J. Koman, Jr. Attorney
    Ronald D. Levis, Investigator
    Division of Enforcement/BCP
    Sugject: Show Cause Order
    International Telephone and Telegraph, ITT, ITT Community Development Corporation ICDC and Palm Coast, Inc., Docket No C-2854
    To : Commission
    That the Commission issue a show cause order as to why the existing fifteen year moratorium on sale of registered residential lots at Palm Coast should not be extended for an additional five years. Note: The extension must be ordered not late than the expiration of the fifteen year period, which expires on December 27, 1991

    Nature of Case
    International Telephone and Telegraph Corporation ( ITT) , its land sales subsidiary, ITT Community Development Corporation ( ICDC), and ICDC subsidiary Palm Coast, Inc., 1 . were charges with misrepresenting ITT’s obligations and responsibilities of ICDC and Palm Coast, unfairly and deceptively selling land by misrepresenting the investment values of Palm Coast lots, misrepresenting the types of amenities and facilities available at Palm Coast and failing to provide cancellation and refund rights and failing to disclose other pertinent information.

    …Scope of Order…
    ‘…Scope of the order

    The Major purpose of the order is to prevent misrepresentations and to require disclosures concerning: (1) the extent of Palm Coast’s developoment, (2) ITT’s financial responsibilities for the development, (3) the investment potential of Palm Coast lots, (4) total lot costs, (5) the current extent of lot use and the timetable for development, (6) the proximity of Palm Coast to major roads, cities and necessary facilities and amenities, (7) number and size of facilities, amenities, and residents, and (8) notices of cancellation.

    a second purpose of the order was to make Palm Coast a self-sufficient community with the necessary amenities for year-round living. To assist in this goal, order paragraphs required certain improvements to be developmed and constructed in Palm Coast. These included: ———–> (1) shopping center,<———- (2) office building , (3) commercial, manufacturing, and research park, (4) corporate headquarters, (5) I-95 interchange, (6) St. Joe Road improvement. All of these improvements were developed and constructed within the time limitations imposed by the order.

  5. St. Josephs’ Plantation

    Additionally it is the site of Brigadeer General Jose Martin Hernandez’s third PLANTATION site – St. Josephs’ Plantation, Slave Quarters, Outbuildings, etc. ( The other PLANTATIONS of the three are Bella Vista ( Washington Oaks) and Mala Compra plantations.)

  6. tulip says:

    Branch Island Walk Assoc. paid 12 million dollars for the shopping center. It appears that perhaps they are trying to hustle Palm Coast. At least that’s how this article appears to me. Now, after paying 12 million dollars for something, I hardly think they would walk away from the project and throw away that money if PC decides not to give them perks. I hope the PC leadership keeps that thought in mind.

    It is not unusual for a city to give perks and incentives to developers because, in the end, if all goes well the finished project brings in money and jobs to the city. However, I do hope PC stays level headed and sensible and doesn’t act in haste.JMO

  7. confidential says:

    Pioneers; you forgot to say that all that was built by ITT without hand outs ( tax breaks or tax incentives) on the backs of tax payers …as were none here. This is a real gouge on our pockets and based on the threat of blight. If we do not maintain our homes we get a warning issue and enforcement. Now these wealthy developers are exempted? No wonder Florida looks like a poor state even with a God given natural geographical beauty. Bleeding the tax payers in favor of the wealthy developers contributes to the status quo. Welcome to the Crown Jewel of Central Florida were the highest unemployment rate shines, derelict fuel leaking vessels sinking and polluting our canals killing marine life are anchored to crumbled docks and seawalls and the darkened molding buildings and vinyl fences are never cleaned up. But developers get all the taxpayers funds they ask for. Squeezing the taxpayers in favor of the wealthy is what keeps the status quo. Is this Island LLC whatever, going to be let to run away after all goodies given and taken and half way into his development plans like, Centex was shamefully allowed?

  8. Hill K says:

    Can we get a Publix , a gas station on u.s.1 and Matanzas Woods.

    • Groot says:

      Yes, please! Can we get a Publix , a gas station on U.S.1 and Matanzas Woods? I don’t think you will ever see a gas station there due to the well fields but a grocery store and a few smaller stores would be oh, so nice. I have a neighbor who says the city owes him for gas every time he has to drive to the Belle Terre or Palm Harbor Publix. I agree with him. We’re sick and tired of being ignored, abused and kicked around up here. Remember that when you vote. The elected incumbents have not been responsive to us. The city officials, including the city manager, have been down right hostile to us up in Matanzas Woods.

  9. Seminole Pride says:

    Good move. In order to attract new businesses and companies to Palm Coast you have got to offer incentives and tax breaks. This will increase employment which will create jobs. which will attract buyers to purchase their products. Good economics.

    • Seminole Pride says:

      As far as a homeowner asking for the city to help them with their property is a cost to all of us, by decreasing my property value, and increasing my taxes. It is the responsibility of the homeowner to maintain their homes and keep them in compliance with code ordinance. of the city.If you want to rent out your home, then you should be required to pay a renter’s tax to the city. Say 30 percent of the rental income.These funds could be used to maintain home conditions on rental homes that have become in need of improvements due to homeowners neglect on their property.

  10. A.S.F. says:

    When do we. the taxpayers, get to have a contract that specifies OUR rights, as well as our responsibilities? Any tax breaks, not already specified in pre-existing contracts with the developers, should entail changes in the city’s contracts with these developers that outline additional responsibilities THEY should be willing to make in return.

  11. Sam says:

    The shopping centre is an eyesore already. Let it rot but no tax break should be provided. Hey it’s election time let’s here the candidates thoughts if they have any

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