JACKSONVILLE, Fla. — Ahead of a meeting in which the Downtown Investment Authority (DIA) will vote on recommending approval or denial of Lot J to Jacksonville City Council, the agency's staff analysis is calling some of the proposed development's terms into question.
In the report, which was released first in a draft version but later Tuesday as a finalized document, DIA criticizes elements of the deal like the $98.2 million infrastructure budget and the $65.5 million interest-free "breadbox" loan.
"Our analysis of financial feasibility and construction costs, based on the information provided, does not reveal a need for this additional incentive as currently structured," agency staff write regarding the loan.
Similar to criticism of the infrastructure budget, discrepancies between the draft version of the report's recommendation on the "breadbox" loan and the finalized version's recommendation are minor but not insignificant.
In the draft version, staff advise to significantly reduce or restructure the loan as a more traditional loan. But in the final version, that specific line is removed, and only the base criticism of the loan remains.
Councilman Matt Carlucci chairs finance committee and wants accountability and transparency as the debate continues.
"If we don't do this thing right, I don't think the voters will ever forgive us," said Councilman Matt Carlucci. "We need to pay attention to the auditors report and we need to get the negotiations out of the backroom."
Councilman Carlucci had been waiting on a review of the project by the Downtown Investment Authority. Now he has that report in hand.
The DIA report found the Lot J project meets the goals of downtown development. In addition, the report states the investors had the capacity to meet obligations.
Part of the deal calls for a 50-year, interest-free loan to investors, and the DIA shot that down.
Here are some of its recommendations:
Recommendation: Our analysis of financial feasibility and construction costs, based on the information provided, does not reveal a need for this additional incentive as currently structured. Nevertheless, we understand that this may be non-negotiable from the Developer’s perspective, and actual construction and operating numbers might justify this incentive.
Recommendation: Clarify the extent of the City’s liability within the Infrastructure budget for environmental remediation if it is intended to be capped.
Recommendation: The Live! lease should be modified to add an acknowledgement of the City’s right to receive certain parking revenue, consistent with Section 12.6 of the Development Agreement and Section 3.5 of the Lot J Parking Agreement.
Recommendation: The Development Agreement should include plain, specific language requiring City approval of infrastructure budgets prior to construction. Consistent with the language in Section 8.9 (a), any dispute of budgets may be resolved between the City Representative and the Developer.
Councilman Carlucci said the city council needs to discuss Lot J , stadium improvements and a new lease with the Jaguars all at the same time.
"I do not know what the rush is," Carlucci said.
Mayor Lenny Curry wants the city council to take a vote by December 8 on Lot J alone. The proposed development is $450 million, with $200 million from city coffers.
Also on the horizon are stadium upgrades of $400-$500 million, which the team says is conditional for a new lease. Mayor Curry took to Twitter to advocate for a vote on Lot J and ran into stinging opposition.
Several people responded to the tweets. Some people agreeing with the mayor. Others criticized the mayor.
The Mayor had no comment on the Twitter voices. He has made it clear that he would like the city council to vote on the project before 2021.
Carlucci said perhaps the votes are there on city council, but he will push for due diligence.
"The taxpayers need to be protected and the council needs to be sure it is making the best decision possible," said Carlucci..
The city council, as a whole, will meet Thursday as a committee to discuss the proposal, the DIA report and by then the City Auditor's report.