Thrive
City questions financing, promises for Gas Plant redevelopment
Affordable housing and project financing topped the list of topics in a heated debate amongst city officials at the Oct. 26 Committee of the Whole meeting. The session was the first time the group had met publicly with Tampa Bay Rays executives to dissect the Gas Planet District redevelopment, which will be the City’s most significant land deal ever.
While the new proposed $1.3 billion Rays ballpark was at the forefront of the discussion, the real estate surrounding the site also generated plenty of comments. The baseball team is promising to deliver benefits for all stakeholders, and has increased the number of affordable housing units.
Per the 100-plus-page agreement outlining details on funding, scope of work and the type of development opportunities, the Rays have committed to bump up the minimum number of affordable housing units from just over 800 to 1,200 units.
The new unit count would be split with 600 units to be constructed onsite and the remaining 600 to be developed offsite.
The market-rate residences have dropped from 4,800 to 3,800, but there would be 600 senior living apartments.
The breakdown of the AMI (average median income) percentages:
- 500 units for those earning 120% of the AMI
- 300 units for those earning 80% of the AMI
- 300 units for those earning 60% of the AMI
- 100 units for those earning 100% of the AMI
The team remains committed to providing $15 million to the housing fund in addition to the high number of units.
The funds would be disbursed in phases per the completion of every developed market-rate unit.
Councilmember Richie Floyd pointed out how previous slides showed a unit count above 1,400 and that with inflation, the AMI would need to be more flexible for the units.
He also stated councilmembers can’t simply “take their [the Rays’] word for it” that the 1,200 units would be delivered.
Councilmember Rob Gerdes said there’s a potential $30 million liability on the Rays and Hines if they don’t deliver the units, which Floyd stated was not a significant obligation for the team.
“They don’t get the property without the units. We get it back and have control and can build anything we want,” Gerdes said. “They are highly incentivized to build those units.”
A Rays representative chimed in, saying the team is following Mayor Ken Welch’s vision in making the district an “affordable place for all people” and they expect to make a profit on both market-rate and affordable housing.
The financing game plan
The Rays are expected pay $105.27 million on a parcel-by-parcel basis for the 60.9 acres, which the property appraiser has valued at $279.36 million.
However, administrators made several deductions – $64.22 million for open space, $10.61 million for affordable housing property and $3.26 million for the Woodson African American Museum of Florida. They also credited the Rays $50 million for their “intentional equity” efforts and $53 million for infrastructure contributions – bringing the net land value down to $98.27 million.
The city would commit $130 million to the needed site infrastructure through tax-exempt bonds.
For the stadium piece, St. Petersburg and Pinellas County would contribute a total of $600 million and the Rays would pick up the remainder of the cost.
The city’s $287.5 million contribution for the new 30,000-seat stadium would be backed by Community Redevelopment Agency tax increment revenue bond issues.
“This is a big lift, but I think it’s a manageable lift and we have not worn our rosy sunglasses to make the numbers look good. We have used conservative assumptions that we believe are going to provide the resources to make those payments,” Assistant City Manager Tom Greene said.
The city would also act as the issuer of the bonds that would be repaid by the county to fund its contribution of $312.5 million for the stadium.
Greene said the county is going through the city to cover its issuance of bonds, as the city holds certain protections. The debt isn’t expected to negatively impact the city’s high bond rating.
St. Pete would use non-ad valorem taxes to make the payments on the bonds issued at current market rates. The taxes include TIF (Tax Increment Financing) revenues, sales taxes and proceeds from land sales.
TIF dollars have been used to finance the St. Pete Pier and, more recently, the city’s sanitation complex.
The city estimates that $50 million of land sale proceeds for the acres redeveloped will be part of the debt repayment on the tax bonds.
There are roughly $33.1 million worth of TIF projects approved that still need funding, which was also taken into account.
The missing links
Transportation was another recurring topic as the site is essentially one large parking lot adjacent to the existing stadium.
“It’s important to build connectivity. We’ve been car-centric for far too long. We also need to think about multi-modal options,” Councilmember Brandi Gabbard said.
A Rays representation said the team has been working diligently on a parking plan over the past 10 months, describing it as a “Jenga puzzle.”
The team would have to construct two standalone parking decks to replace the current parking spots when the development commences.
The appraised $280 million value of the site does not account for the city’s $130 million infrastructure commitment that would be received by 2035. The infrastructure costs could total $180 – $200 million.
In response to Councilmember Lisset Hanewicz asking why the city would foot the infrastructure costs, the Rays team said the appraised value did not account for that as it would assume the needed roads, and ingress and egress are incorporated at the site that’s not currently integrated with the urban fabric and street grid.
Next steps in the negotiation process
In the first quarter of 2024, the plans will go before the St. Petersburg Community Planning and Preservation Commission for rezoning approval. There will be another Committee of the Whole meeting. The St. Petersburg City Council would meet in the first or second quarter to review the development agreement for final approval. If approved, construction for the stadium would commence in November.
Debi Mazor
October 30, 2023at5:05 pm
Some (shall I mention any names?) doth protest too much. Where were the protests and protectors when the City “gave away” the land for 400 Central to the billionaire grocery man? What about the other sweetheart deals in downtown that rendered it a mini-New York? There are a whole lot of St Pete residents who would rather see the Trop site give a nod to its original demographics (likewise the St Pete Marina) than to have these sites become another bonanza for foreign developers. And when I use that term I mean any development corporation that has no ties or commitment to keeping St Pete’s special character, charm, beauty and as a haven for those who appreciate art, nature and having a sense of place!
Ryan Todd
October 30, 2023at7:21 am
Mayor Kreisman knew better than to deal with merge Rays.
Please deny this deal, Council.
Alan DeLisle
October 29, 2023at9:22 am
This deal is so bad I’m not sure where to start. Well, it started with the city giving up all its leverage when they only played to the Rays. That’s what happens when power and money influences community special interests and politicians. And since the deal is so bad, the Rays now say the city must act fast to meet their deadlines. What a shock. Just a couple of things to ponder:
1. Land credits for open space (open space??!!) and affordable housing are ridiculous, almost a $75 million giveaway.
2. The land giveaway for affordable housing is in addition to public tax credits and grants that are required before the Rays have to build it.
3. For the above affordable housing public giveaways, the return is pathetic — AMI ratios, # of units, location. Midtown was much stronger.
4. Minimum development is weak, timelines are even weaker or non-existent and the links to St Pete’s economy missed drastically.
5. To think the city’s bill is about $430 million is a dream. Count the land value giveaways , the required city cost for the affordable housing, financing expenses, surrendering all stadium operating revenue (including naming rights) and all ancillary costs, including 50% of the TIF revenue that was going to the General Fund to support neighborhoods and you are in the billions not millions.
6. Once the stadium is built and the city spends its $130 million on infrastructure, do you really think the Rays will spend a dime on additional infrastructure. Midtown was a 50-50 split on infrastructure.
Unless the Council makes major changes, which I doubt they will, this deal is for the Rays ownership and their future profit from a sale and not for the future of a great city. I guess Tampa and Montreal knew better.
james gillespie
October 29, 2023at5:16 am
THE SCOPE, LENGTH OF THE PROJECT, FINANCIAL ASSIGNMENTS AND ASSUMPTIONS AND RESOURCES FOR EXECUTION ARE COMPLEX AND WILL CHANGE. THE ROLE OF A SPORTS TEAM IS UNIQUE. THE DEVELOPMENT CONTRACT MUST BE POLICED AT ALL TIMES BY EXPERTS AS WELL AS POLITICIANS. IT IS A LONG SHOT WITH ELEMEMTS OF IDEALISM SO GOOD LUCK