Incentive program may breathe new life into South St. Pete projects
Planned business incubators and commercial revitalization projects in South St. Pete may come to life with the backing of a new tax increment financing program.
During a Thursday St. Petersburg City Council meeting, the councilmembers unanimously approved a new “no-cap” economic incentive tax program for the South St. Pete Community Redevelopment Agency (CRA) to fund soft costs and physical improvements through a debt service or on a pay-as-you-go basis.
“We were envisioning applying these funds to the Manhattan Casino, which I know the council is very interested in rehabbing, potentially Tangerine Plaza, Sankofa and other major facilities that need support,” said the city’s economic development manager Rick Smith, who spearheaded the formation of the South St. Pete CRA.
The historic Manhattan Casino, a culturally significant facility in The Deuces that was converted into a food hall, fell into a state of disrepair and the venture ultimately failed. The city is considering a new future usage, as revitalization plans move forward. Meanwhile, the redevelopment of Tangerine Plaza and Sankofa projects are geared toward bringing new resources to the area.
The city’s Thursday vote includes the approved use of tapping into Tax Increment Funding, a public financing method used as a subsidy by local governments to fund infrastructure projects that improve a community.
City staff would negotiate terms with a developer, and the agreement would go before the city council for approval. The business/development must meet the requirements outlined in the Community Benefits Agreement. If it doesn’t meet the threshold of the CBA terms, city staff would work with the developer on hiring residents and supporting small businesses.
Smith said there isn’t a cap on the funding amount; however, if a project is applying to use $75,000 or more through the program, the request must go before the city council for approval. If the city intends to use county TIF contributions in excess of $1.5 million for a single project, city administration would provide documentation to the county administrator to justify the amount, according to city documents.
The program mirrors the CRA’s affordable housing loan program, which was used for Jordan Park, a historic African American housing development in South St. Petersburg that is being redeveloped. It was also used for the Fairfield Avenue Apartments, a 264-unit affordable housing development.
“We probably will not be budgeting upfront unless we have a project in mind,” Smith said. He doesn’t expect the city to review more than two projects annually. “It [projects] will be evaluated on other needs in the budget.”
Councilmember Richie Floyd said he agrees there is a need for the program, but he will have a “more critical eye” and a keen interest in monitoring the projects utilizing the program.
The approval of the new program comes days after the city announced the rollout of the South St. Petersburg CRA Microfund program – an accessible funding pot for business owners to make targeted improvements without providing any upfront capital or matching.
“The timing of how we’ve released the microfund earlier this week and this programming [are] bookends to me. There’s a whole lot in the middle we still need to work on, but I feel like it’s coming together,” said councilmember Brandi Gabbard, acknowledging how councilmembers are critical of different CRA programming.
Several years ago, the city created the South St. Petersburg Plan to assist small businesses in improving the visual appearance and extending the economic life of buildings through programs such as the Commercial Site Improvement Grant, Commercial Building Interior and Tenant Improvement Grant, and the Commercial Revitalization Program. These programs had incentive award amounts ranging from $20,000 to $100,000 and typically required a match to trigger grant eligibility.
Despite the programs, the funding amounts were not substantial enough to plug financial gaps for the larger employment creation projects that the new program would support, according to city documents.