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City assumes CRA responsibilities

By Staff | Oct 30, 2012

Cape Coral City Council assumed downtown Community Redevelopment Agency oversight on Monday.

Downtown business owners had filled the gallery during the special meeting at city hall, speaking in hope that council would decide to leave the CRA with its own board and staff.

After a four-hour meeting, however, council voted 5-3 vote to take over the duties of the CRA with the majority saying the decision was one of simple finances and the future solvency of the agency, not a reflection of what it had done.

Nonetheless, the decision was a heartbreaker for the soon-to-be-absorbed CRA as we know it, while the city called it doing best practices.

“I think they voted with their heart. I don’t think they know what they’re stepping into,” CRA Chairman Rich Greer said. “I think the downtown is going to lose their representation.”

City Manager John Szerlag, who had recommended the consolidation which positions city council as the CRA board of directors and himself as its chief, explained the district simply is no longer bringing in tax revenue to be sustainable in the long term.

“I was brought here to make recommendations for long-term fiscal sustainability,” Szerlag said. “They’ve done nothing wrong, but the reduction in taxable values is such that after debt service they only have $50,000.”

Szerlag explained to council that two-thirds of the state’s CRAs have local government bodies as their boards. He also said it ultimately came down to money.

“Unfortunately, the CRA has no money to do meaningful capital improvement,” Szerlag said. “Consolidation is best practice.”

Financial officer Victoria Bateman presented a slide show which said for every month’s balance not depleted, the city can do one capital project, such as street lights, etc.

CRA executive director John Jacobsen had reiterated his request for a joint workshop and also presented a compromise proposal, which included a reduction in salary for all CRA employees and the elimination of the project manager position.

He also maintained the CRA was solvent, having prepared for the economic downturn in 2008.

“We expected the TIF (tax increment financing) revenue would decline. It was like deflating a balloon so we could go ahead over time,” Jacobsen said.

During public input, nearly everyone expressed the desire to leave the CRA alone, with applause after almost every speaker. Opposition was tepid at best, with many adding the city needed to think before assuming the responsibility of keeping the city’s downtown, also called the South Cape, viable.

Patti Barker turned in petitions to keep the CRA as is and expressed her vote of confidence.

“I’m glad we have the CRA. I don’t think giving 10 percent of a workweek will accomplish what the CRA can,” Barker said.

“Money isn’t everything. For three years we had a liaison to the CRA say things were fine and dandy. Suddenly, you want to take over,” Eric Keen said.

“There are people who help and people who stymie. I want to see you talk. Think it over,” Betty Gill warned.

During council comments, Councilmember Chris Chulakes-Leetz, who in March brought up a similar bill before withdrawing it so Kevin McGrail could pick it up to deny it, believed his withdrawal was the correct move.

“You’ve done the job, you found the problem. The undergrounding (of utility lines) was the right thing to do,” Leetz said. “I’m not wild about consolidation, and I’m not willing to revoke my vote of confidence.”

McGrail, meanwhile, said he failed to see the need for an immediate decision.

“This was brought to us as an emergency situation. I don’t feel we’re falling off a cliff. To pound a nail on these people would be wrong,” McGrail said.

Others said they couldn’t get past the fiscal factor.

“Do we continue to fund for simplicity and oversight because we like them? They were aware of the financial issues,” Councilmember Marty McClain said. “You lost me when you retained a consultant at an enormous price.”

“This isn’t about spin. These charts aren’t spin. A lot has changed since the vote of confidence. I have the date,” Councilmember Derrick Donnell said.

Leetz proposed making a motion to deny the ordinance, which Sullivan seconded, and then withdrew his vote although he tabbed the issue an example of the “Chicken Little Syndrome.”

The ordinance passed, with Sullivan, Leetz and McGrail casting “no” votes.

Greer, who blamed numbers spin for council’s decision, was not happy.

“The way the numbers were presented was a cause for taking action,” Greer said. “The numbers were misconstrued and misleading because we had reserves to draw down.”