Pinellas County Commission Chair Charlie Justice, who also serves as chair of the Tourist Development Council, talks about concerns with changes to guidelines for the Capital Projects Funding Program June 7.
CLEARWATER – Pinellas County Commissioners decided June 7 to ask the Tourist Development Council to take another look at proposed changes to guidelines for the Capital Projects Funding Program.
Visit St. Pete-Clearwater Executive Director David Downing told commissioners that the proposed guidelines had been unanimously approved by the TDC. He said the changes assure that bed tax money would be spread across many uses by limiting funding categories to 20 percent each.
Allocating percentages would prevent all the money going to one type of expenditure, providing maximum flexibility, he said.
Commission Chair Charlie Justice, who also chairs the TDC, said although the decision was unanimous, TDC Vice-chair Russ Kimball, general manager of the Sheraton Sand Key Resort, and Clearwater Mayor George Cretekos had concerns. Justice said the vote was more a “sign of unanimity” as opposed to “true 100 percent consensus.”
St. Petersburg Mayor Rick Kriseman was absent. Justice said the vote might have been different if Kriseman had been there.
Last year, the commission and TDC went back and forth for months to find agreement on contentious changes to the tourist development plan made in part to account for the levy of an additional percent in bed tax, as well as intent to simplify the plan and make it more flexible.
In the end, the commission approved splitting proceeds from 6 cents in tourist development tax, more commonly called bed tax, 60 percent to 40 percent with 60 percent going to pay for operations for Visit St. Pete-Clearwater and promotion of the county as a destination.
The other 40 percent would pay for beach nourishment and capital projects, including debt service, as allowed by state statute, which ultimately governs how the money can be spent.
The funding guidelines split the 40 percent into categories of allowed uses, giving each 20 percent. It also includes the process for submitting applications for funding.
Dunedin Mayor Julie Ward Bujalski and Mayor Kriseman outlined their objections in a letter, which was answered by TDC Council Member Phil Henderson, president and CEO for StarLite Cruises, who championed the changes to the guidelines.
Commissioner Janet Long questioned the need to make changes.
Assistant County Attorney Michael Zaas, who advises the TDC, said existing guidelines lacked a process for applicants seeking money for capital projects. The guidelines don’t include the newly levied 6th cent. The proposed guidelines also add language to assure the money can be used for a variety of uses, Zaas said.
“There’s nothing wrong with the guidelines, they follow the statute,” he said, adding that the statute does not require guidelines.
“Each time you come and say you’re making it simpler, but you’re not. You’re adding another layer,” Long said.
Downing said the county’s plan was simple compared to others around the state. He admitted it was a confusing process, but said the proposed changes would give maximum flexibility and make sure that money was left for “something else.”
Commissioner Ken Welch asked how the new formula would affect funding for beach nourishment. Zaas said ˝ of 1 percent would be dedicated to that category, which should bring in about $3.7 million, which is very close to what it has been, about $3.5 million.
Zaas added that the guidelines could be changed at any time with a simple vote of the commission.
Welch said the proposed guidelines have less flexibility.
“You lose the power of cash funding,” he said.
“Ultimately, it does have more restrictions,” Zaas said.
Commissioner Dave Eggers agreed with Welch, saying the proposed guidelines added another level of restrictions. He is concerned that some applicants might not bring a project forward because they don’t think it would be considered due to a formula of 20-20-20 and application requirements.
“Heads and beds is the real return,” he said. “I understand the intent to spread it around, but this is more cumbersome. It is not flexible.”
Long said she was disappointed that the TDC wanted to additional restrictions.
“It doesn’t really match our intent,” she said, adding that what applicants might ask for was still unknown.
“It would be nice to have the flexibility to consider them all,” she said.
Commissioner Karen Seel said during all the discussions last year about a new tourist development plan, beach nourishment was top of the list for the 40 percent left after 60 percent went to marketing and advertising. She said capital projects should have a return of investment, in other words, provide heads in beds for local hoteliers.
Seel thinks the proposed process for applying for capital funding is fair and equitable with a public meeting and an independent committee to vet the applications.
Mayor Bujalski said she understood the motivation for a balanced approach to be transparent, fair and equitable, but she said the proposed guidelines limit flexibility. She cautioned the commission to beware of unintended consequences down the road.
Bujalski is concerned about required paperwork and a statement in the proposed plan that a project would be disqualified due to a lack of paperwork. The commission agreed and voted unanimously to change the wording from "will be" disqualified to "may be" disqualified. Bujalski also wants some consideration in paperwork requirements for those who have been awarded funding in the past compared to those submitting brand new projects.
Bujalski and Kriseman have a vested interest in Major League Baseball. Dunedin is currently in negotiations with the Blue Jays about spring training. St. Petersburg is working with the Rays on the team’s stadium needs. Both could need bed tax money to fund future baseball projects. Bujalski says she is running out of time and needs to submit an application soon for funding if the Blue Jays want a capital investment to stay in Dunedin.
Commissioner John Morroni commented that the commission didn’t receive the letter from the mayors objecting to the guideline changes until Friday, leaving little time to consider them. Welch agreed, adding that the mayors had made some good points.
Bujalski pointed out that TDC meetings do not allow citizen comments before votes. She said she didn’t get an opportunity to voice her objections to the changes at the TDC meeting where they were approved, because citizen comments come at the end of the meeting. Morroni said he would get with Justice and Downing and try to get it fixed so the public could speak before votes.
Morroni then suggested that the commission send the guidelines back to the TDC as opposed to just making changes. Justice said he could get the matter on the July agenda. Commissioner Pat Gerard preferred that the commission make the changes it wanted.
“We asked for flexibility and they gave us rigidity,” she said.
The commission finally agreed that the most respectful thing to do would be to return the proposed changes to the TDC with a list of concerns, including the 20-20-20 percent funding formula.
“It affects how much we can spend on a stadium, if needed,” Welch said.
With the new 6th cent levy in place since Jan. 1, bed tax collections are up 23.39 percent through April with nearly $29.66 million in tax revenue coming in so far. The county’s fiscal year is Oct. 1-Sept. 30.