LARG0 – The city of Largo is preparing four different incentive programs designed to encourage growth and development of the West Bay Drive downtown area.
The Largo commissioners gave their full support for three of the incentives presented Jan. 15 and expressed hesitation for the fourth program awarding businesses for the creation of new jobs. Since then, Economic Development Manager Teresa Brydon has been working on an amendment to the West Bay Drive’s Community Redevelopment plan that will allow the use of incentives and must be approved by the county.
“I don’t see them denying, as it will not impact their revenue,” she said recently. “Their share that goes to the community redevelopment fund will continue to be used for the infrastructure and the things they specifically asked for.”
But Largo’s portion of the tax increment financing, an average of $362,886 per year, could be budgeted to fund the new programs. The changes would prompt the formation of a new advisory committee – made up of members of the community development advisory board and two other people from the West Bay Drive area – to oversee how those funds would be spent.
Rewarding job creation
Commissioners only objected to the fourth incentive program, which would provide a grant to businesses that create three or more new or relocated jobs within the West Bay Drive district. If approved, Largo would be the first city on the west coast of Florida to institute such a program.
Largo businesses already can apply for a state qualified target industry tax refund by creating high-wage jobs in certain categories. But the state standards require businesses to create 10 jobs new to the state of Florida and sell their goods out of state, qualifications most small businesses have trouble meeting, Brydon explained to the commission Jan. 15.
“This particular one now provides us an opportunity to work with smaller businesses that are what I call homegrown,” she said.
The program would require the jobs have wages that are 115 percent of the county’s annual average wage and fall within a specified industries: communications and information technology, life science, business or financial services, clean energy, emerging technologies, aviation or aerospace and corporate headquarters. The city was not interested in new retail jobs, Brydon later clarified.
“The objective is to bring in professionals and people that can spend money in order to facilitate the development and keep the retailers and restaurants that we do have and keep feet on the street,” she said.
New jobs created anywhere in the West Bay Drive district would qualify for a grant of 5 percent of all certifiable annual wages. Jobs created in a rehabilitated office building could qualify for 10 percent of the business’ wages and those created in a newly constructed office building could earn a grant worth 20 percent of those wages.
The awarded grant would be paid out over five years and be capped at $10,000 per job or $50,000 per year for all jobs created.
Commissioner Robert Murray objected that the incentive awarded businesses “after the fact,” when businesses really created jobs as there was a demand for service increased.
“I don’t see the public good as much as I do on the other incentives,” he said.
He also didn’t see the fact that Largo would be the first for the area to create such a program as a good thing.
“If we’re the first, we end up creating this arms race,” he said.
Mayor Pat Gerard also voiced objections to the program, asking how the program would be administered and how businesses would be measured for compliance. She also was less then enthusiastic that the program would award businesses for moving jobs to downtown Largo from other parts of the county.
“I don’t want to be accused of stealing jobs from St. Petersburg,” she said. “I’m still open to (the program) but not quite as comfortable.”
Commissioner Woody Brown said he wasn’t “100 percent sold” on the idea.
“But we need to use the money that we’ve taken in the last several years ... and use it to build the downtown, which is what we’ve collected it for,” he said. “I don’t discount any ideas. But I’d like some more information on what other communities have done.”
Developing the East Bay downtown
The city’s economic development staff would bring the job creation program back up for discussion in June or July, Brydon said. In the meantime, they would be moving forward on the other three programs that did receive a more positive response from the commission.
The first of the programs would encourage businesses to switch their signs to the freestanding monument signs that will be required in the West Bay Drive district by June 2017. The early sign replacement program would offer up to $200 in a grant to cover the permitting and planning fees associated with the construction of the new sign. The program matches a citywide sign incentive.
The housing incentive program would offer funds for each residential unit constructed. This second incentive would offer $5,000 for each unit or 5 percent of the hard construction and land costs of each unit, up to $10,500 – with the total amount not to exceed $250,000.
The city wants to not only incentivize development of vacant land into residential housing that adhere to the district’s urban design vision, but also encourage the construction of “second tier” homes, a concept Brydon said she had trouble defining.
“We have a lot of greater starter homes,” she said, explaining that new families can find plenty of two-bedroom or small-size homes within the city. “What’s happening is when people out grow their first home, there are not always options for them in Largo.
Brydon hopes the program could prompt quality homes with more space that could keep growing families within Largo’s borders.
The third program would focus on encouraging the development of office space. The real estate development grant would reimburse businesses for improving or constructing a project with a minimum of 15,000 square feet of office space. The grant would be worth up to 50 percent of the project’s projected taxable value increase. The buildings could be multi-story or multi-use projects, as long as they included the minimum office space requirements.
“The key is to try to bring more offices into the downtown, to try to build the daily workforce numbers,” Brydon said.
The office space program builds on the incentive for increased residential development, Brydon said.
“How great it would be to walk across the street or down the street and be able to go to work?” she asked.
Likewise, the job creation program would complement the creation of office space.
“My thinking was, if you asked them to build it, you need to help them fill it,” Brydon said.
Depending on how quickly the county approved the amendment to the redevelopment plan, Brydon hoped to be able to present the first three incentive programs for final commission approval in late summer.
“The big discussion will be whether or not we implement that job creation incentive,” she said.