CITY OF CASSELBERRY. COMMUNITY REDEVELOPMENT AGENCY 95 Triplet Lake Drive Casselberry, Florida CRA JUSTIFICATION REPORT

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1 CITY OF CASSELBERRY COMMUNITY REDEVELOPMENT AGENCY 95 Triplet Lake Drive Casselberry, Florida CRA JUSTIFICATION REPORT OCTOBER 2016

2 CASSELBERRY CRA JUSTIFICATION REPORT EXECUTIVE SUMMARY The City of Casselberry requests an amendment to the Delegation of Authority to extend the lifetime of the CRA for a period of 8 years (to year 2025). The Casselberry CRA requests this extension to recover from the double economic impact of the Recession and the loss of land and reduction of marketability due to the construction of the Flyover at the intersection of US Highway 17/92 and SR 436. The extension will provide an opportunity to the CRA to recover from these impacts and capitalize on several developments currently under construction. The negative impacts have been measured to include; An overall loss of Incremental Value in the CRA of 65% since FY 2009 resulting in a reduction of TIF of over 59.9% during that time. FDOT acquired 34 parcels containing 13.5 acres. The valuation of the 34 parcels is estimated at $26 million. The land acquisition by FDOT resulted in the taking of 18 entire properties and 8 partial takings. A total of 14 businesses were forced to close which employed 64 persons. Access and visibility will be reduced due to the construction of the ramps for the Flyover. Activities of the CRA have included; Incentive Programs Façade Improvements Infrastructure Improvements Aesthetic Improvements Land Acquisition The CRA proposes to continue these activities as well as add; Acquiring additional properties for future redevelopment Acquiring additional properties for the expansion of Lake Concord Park Conduct a marketing and Branding Program to enhance business opportunities. Casselberry CRA Extension Page 1

3 Complete approximately $20.25 million in Infrastructure improvements. However, the eight year extension will not generate sufficient funds for those projects. Financial Impacts of the extension and completion of the Redevelopment Program The district will experience a reversal of the decline in valuation in the future o Lake Concord Park, Bainbridge Casselberry Apartments, and several smaller projects are currently under construction, adding over 500 residential units and more taxable income to the area. o Taxable Value is expected to increase from $144 million in 2016 to $246 million in o In the year 2025, the CRA will generate TIF revenue that is positive from 2009 of 200%. The district will maintain a positive Cash Flow throughout the timeframe of the extension due to phasing of capital expenditures. o The capital projects recommended for the district will be completed in o The CRA will generate $9 million in TIF through the additional eight years. Combined with cash on hand, the CRA will have $7.9 million available to commit to the necessary projects. o The expenditures through the additional eight years equal $9 million, allocated as follows: Operations - $1.1 million Capital improvements/incentives/branding - $7.9 million Recommended projects are: o Land Acquisition for the expansion of Lake Concord Park o Land Acquisition for key commercial properties to redevelop o Building a parking garage to serve City Hall and surrounding commercial properties o Signalized intersection at Lemon Lane and US Highway o Decorative Light Posts along US Highway o Pedestrian Bridge across US Highway o Gateway signs at strategic locations along US Highway and SR 436 o Building an Events Center to serve the residents, private and non-profit organizations throughout the community. The extension will allow the CRA to address some of the important economic development needs in the district and to recapture the business viability of the corridor. Needed improvements and projects include an estimated $20.25 million, which exceeds the $7.9 million available. (See following table for list of needs) Casselberry CRA Extension Page 2

4 PROJECTED CAPITAL NEEDS FOR CRA AREA Name Description Cost Land Acquisition Expansion of Lake Concord Park Purchase property around Quail Pond Circle and extend the existing Lake Concord Park to the north and east of City Hall $1,500,000 Land Acquisition Key Commercial Properties Parking Structure at Lake Concord Park Lemon Lane Signal Decorative Light Poles Development Incentives Pedestrian Bridge Gateway Signs Events Center Purchase property at key locations to aggregate properties and participate in another Public/Private Partnership to develop those properties $2,000,000 Design and build a parking garage to provide parking for $4,500,000 employees of the city, residents, and local businesses A signalized intersection at Lemon Lane and US $1,500,000 Highway Installation of decorative light poles along US Highway $4,000, Create incentives for new development within the District $500,000 Design and build a pedestrian bridge over US Highway $3,000, Monument signs at key locations along SR 436 and US $250,000 Highway Create a civic space where residents can gather and host $3,000,000 events Total Projected Capital Needs for the CRA $20,250,000 Casselberry CRA Extension Page 3

5 SECTION 1 - INTRODUCTION/PURPOSE The Casselberry Community Redevelopment Agency (CRA) was established in 1995 through an authorization by Seminole County and sponsorship by the City of Casselberry. Recent circumstances have generated negative impacts in the current Casselberry CRA jurisdiction resulting in a severe loss of economic potential and opportunity in the area. These circumstances include the impacts of the Great Recession as well as the disruption due to the construction of the Flyover on US Highway 17/92 at the intersection with State Road Request of the Seminole County Commission by the Casselberry CRA The Casselberry CRA is requesting an extension of the effective time of the authorization of the CRA for a period of eight years. The current authorization provides for a sun-setting of the district in This request, if approved, will extend this time to the year There are no other modifications (area, powers) included in this request. Purposes of Extension: 1. Providing sufficient time to recover from the negative impacts of the Flyover. 2. Continue with projects such as Lake Concord Park which is a significant investment for stimulus of the economic development of the corridor. 3. Capitalize on existing development interest within the district. This request for extension is a multi-step process which includes: Amendment of Delegation of Authority Amend the Casselberry CRA Redevelopment Plan Determination of Consistency with the Casselberry Comprehensive Plan by the Casselberry Planning and Zoning Board Approval by the Casselberry City Commission 1.2 Rationale for the Request The CRA operates based on the collection of Tax Increment Financing (TIF), which has an underlying dependence on increasing property values. The Casselberry CRA received a double economic blow with the impacts of the recession, as well as loss of property value due to eminent domain taking of 34 properties for the Flyover. In addition to many of these properties becoming retention areas, the Flyover has restricted access to the few remaining business properties located near the intersection of US Highway 17/92 and SR 436. It is acknowledged that all local government units suffered due to the Recession. However, the double impact of the Recession and the Flyover has placed the Casselberry CRA in a unique position. The quantitative impacts of the negative economic factors will be addressed in Section 2. Casselberry CRA Extension Page 4

6 1.3 History of the Delegation of Authority In 1995 the City of Casselberry adopted a Finding of Necessity Study (FON), in accordance with , Florida Statutes, declaring the existence of slum and/or blight as defined by , Florida Statutes within the corporate limits of the City and a need to create a Community Redevelopment Agency. As Casselberry is located within Seminole County, a county which has adopted a home rule charter, the powers to carry out redevelopment under 163, Part III, Florida Statutes (including the power to create a community redevelopment agency) is vested in the County. Therefore, upon the acceptance of the Finding of Necessity, the City requested a delegation of the powers under the statutes from the County to the City. In November, 1995, the Seminole County Board of County Commissioners delegated said authority with conditions including a 15 year limitation on the term of the Casselberry Community Redevelopment Agency by adopting Resolution No. 95-R-255. The City adopted Ordinance in December of 1995 which created the CRA. In 1998, County Resolution No. 98-R-188 was adopted which amended the delegation of authority and to permit the County to contribute increment revenue (TIF) and delegated authority to the City to allow the Casselberry CRA to collect increment revenues from the County. This action occurred upon the creation of the multi-jurisdictional US Highway CRA. In 2002, the County passed a resolution, No R-33, that included an extension of the term of existence for the CRA from 15 years to 20 years; and also amended the delegation of authority. In 2006, the CRA conducted an audit of its finances that resulted in a reconciliation with Seminole County as to required additional revenues. In 2014, the City requested the County extend the existence of the CRA from 20 years to 30 years (2025). The County only approved a two year extension to December of 2017 via Resolution 2015-R Process for Extension The Process As Seminole County is a home rule chartered county and in its delegation of authority of powers under 163, Part III, Florida Statutes withheld the ability to regulate the term of existence of the Casselberry CRA, the County must amend the delegation of authority to extend the term of the CRA. The City and CRA must approach Seminole County to discuss the potential to amend the delegation of authority as adopted by Resolution No. 95-R-255,amended by Resolution No R-33 which allowed the CRA a term of 20 years - (or a sunset date of 2015) and recently approved Resolution No R-106 extending the current term to The amendment to the delegation of authority can be obtained at any point prior to the completion of all the required formal steps outlined below, or it can be at the completion of all of Casselberry CRA Extension Page 5

7 the steps. No effort to extend the term of the CRA can be implemented however, until the City receives approval of a delegation that allows it to extend the term. Additionally, the City should seek continuation of the terms as expressed in the first amendment to the delegation of authority, County Resolution No. 98-R-181 as it relates to the collection of increment revenue from the County. Number 2 under the Therefore section of the resolution specifically states (Italics added for emphasis):.such increment revenues, when deposited into the Trust Fund, may be used by the Casselberry Community Redevelopment Agency in a manner consistent with its redevelopment plan and with general law. Any such funds may be pledged as collateral for the repayment of bond revenues, consistent with Part III, Chapter 163, Florida Statutes (1997) and general law. This funding shall continue through the existing term of the Casselberry Redevelopment Plan, and the level of funding shall be at the maximum level established by the funding of the Trust Fund consistent with the provisions of State law and this delegation. Relevant Statutory Regulations The term of existence of the CRA and its collection of increment revenue are generally regulated by two sections of the Florida Statutes; (10) and (2)(a) , Florida Statutes is the section that outlines the contents of a Community Redevelopment Plan. Subsection (10) specifically indicates that the Plan shall: Provide a time certain for completing all redevelopment financed by increment revenues. Such time certain shall occur no later than 30 years after the fiscal year in which the plan is approved, adopted, or amended pursuant to s (1). However, for any agency created after July 1, 2002, the time certain for completing all redevelopment financed by increment revenues must occur within 40 years after the fiscal year in which the plan is approved or adopted. Additionally, the CRA would clearly like to extend its term so that it can continue to collect increment revenue to undertake desired projects. Therefore, (2)(a), Florida Statutes is relevant to the effort as well. This subsection, part of the section laying out terms of the Redevelopment Trust Fund, states: Except for the purpose of funding the trust fund pursuant to subsection (3), upon the adoption of an ordinance providing for funding of the redevelopment trust fund as provided in this section, each taxing authority shall, by January 1 of each year, appropriate to the trust fund for so long as any indebtedness pledging increment revenues to the payment thereof is outstanding (but not to exceed 30 years) a sum that is no less than the increment as defined and determined in subsection (1) or paragraph (3)(b) accruing to such taxing authority. If the community redevelopment plan is amended or modified pursuant to s (1), each such taxing authority shall make the annual appropriation for a period not to exceed 30 years after the date the governing body amends the plan but no later than 60 years after the fiscal year in which the plan was initially approved or adopted. However, for any agency created on or after July 1, 2002, Casselberry CRA Extension Page 6

8 each taxing authority shall make the annual appropriation for a period not to exceed 40 years after the fiscal year in which the initial community redevelopment plan is approved or adopted. It is clear from these two sections of the Statute that the key to the extension of the term of existence for the CRA is to amend the Casselberry CRA s Community Redevelopment Plan. The City and CRA will need to include the change in the time certain for the completion of redevelopment financed by increment revenues (existing term plus the desired extension) into the Plan through a modification to the Plan and with adoption language that specifically calls out the extension of the term. Statutory Requirements to Amend a Community Redevelopment Plan , Florida Statutes outlines the requirements that must be followed to prepare and approve a modification to a Community Redevelopment Plan. In the case of Casselberry the following procedures would need to be adhered to: 1) The CRA Board needs to ensure a Community Redevelopment Plan modification is presented that clearly states that the modification includes an extension of a time certain for the completion of redevelopment to be paid for by increment revenues. Any additional projects or programs not already outlined in the existing Community Redevelopment Plan should also be included in any modified Community Redevelopment Plan to ensure these projects/programs could be undertaken and paid for by the CRA. 2) The Statute requires that the Community Redevelopment Plan be in conformance with the City s Comprehensive Plan. While Plan modifications are not required to go before the Casselberry Planning and Zoning Commission/Local Planning Agency (LPA) for a review for compliance with the Comprehensive Plan (as is required for a new Community Redevelopment Plan), it is advisable that the CRA transmit any document it intends to recommend to the LPA for comments. 3) Upon the receipt of report of comments from the LPA, the CRA should determine the need to address LPA comments, if any. Once comments, if any are addressed, the CRA needs to formally recommend its Community Redevelopment Plan for approval by the governing body (city commission). 4) The City Commission must then schedule the amended Community Redevelopment Plan for a public hearing. 5) The public hearing must be scheduled with enough time to comply with notification requirements outlined in , Florida Statutes This section requires two items: a. the governing body (city commission) to provide public notice of its proposed action to consider approval of an amended Community Redevelopment Plan by advertising in a newspaper of general circulation in the City at least 10 days prior to adoption. The notice of proposed enactment shall state the date, time, and place of the meeting; the title or titles of proposed ordinances; and the place or Casselberry CRA Extension Page 7

9 places within the municipality where such proposed ordinances may be inspected by the public. The notice shall also advise that interested parties may appear at the meeting and be heard with respect to the proposed ordinance. b. The governing body (city commission) must mail by registered mail, a notice with the same information as published in the newspaper to each taxing authority which levies ad valorem taxes on taxable real property contained within the geographic boundaries of the redevelopment area at least 15 days prior to before any proposed action. (NOTE: Statute does not state that the notice should be mailed to taxing authorities contributing increment revenues, but states that it should go to ALL taxing authorities collecting ad valorem taxes within the CRA. Statute does however exempt the City from noticing the School Board.) 6) Notwithstanding the requirements for notification in #5 above, any change that extends the life of the CRA, the Agency is also required under (3)(a), Florida Statutes to report such proposed modification to each taxing authority in writing or by an oral presentation, or both, regarding such proposed modification. 7) After all of the previous requirements have been met, and only then, the governing body (City Commission) then must hold a hearing on the amendment and vote on its adoption. TABLE 1-1 STEPS TO APPROVE MODIFICATION TO EXISTING CRA REDEVELOPMENT PLAN Step Responsible Party Action Prepare CRA CRA Prepare and Adopt. Redevelopment Plan Determination of P&Z Board Review and Comment. Compliance with City s Comprehensive Plan Address P&Z comments CRA Modify, if necessary and recommend to the City Commission. Schedule Public Hearing City Commission Schedule and give notice to public 10 days prior to hearing. Notify appropriate taxing agencies 15 days prior to hearing. Report to appropriate Taxing Agencies CRA/City Commission Report modification (extension) to appropriate Public Hearing and Adoption City Commission taxing agencies. Hold Public Hearing and vote regarding adoption. Casselberry CRA Extension Page 8

10 Conclusion Extending the term of the Casselberry Community Redevelopment Agency is a relatively straightforward process. First, the City must obtain an amendment to the delegation of authority from Seminole County to specifically allow an extension and to specify how many years it could be extended and then the CRA/City must modify the Casselberry Community Redevelopment Plan to specifically address this new time certain by which redevelopment funded by increment revenues will be addressed. Casselberry CRA Extension Page 9

11 SECTION 2 IMPACTS OF THE FLYOVER Although the City of Casselberry and the Casselberry CRA have embraced the newly constructed Flyover at the intersection of US Highway 17/92 and SR 436, the reality is that the area and the CRA has experienced fiscal impacts. The design of the Flyover required the acquisition of land by FDOT for the ramps and other structures. This land acquisition reduced the Taxable Value of the CRA and the ability to generate TIF funds. The requested extension will enable the CRA to take measures to recover from the loss of revenue that has occurred. Exhibit 2-1 FDOT Acquisitions Map Casselberry CRA Extension Page 10

12 2.1 Loss of Valuation/TIF When reviewing the Taxable Value for the CRA in the years between 2009 and 2016, a significant reduction is evidenced and is just starting to bounce back. As indicated in Table 2-1, the CRA has experienced a severe reduction in the funding capacity of the agency. Table 2-2 illustrates the loss of revenue to the CRA. TABLE 2-1 CHANGE IN INCREMENTAL VALUE CASSELBERRY CRA FY 2009 TO FY 2016 TABLE 2-2 CHANGE IN TIF CASSELBERRY CRA FY 2009 TO FY 2016 Casselberry CRA Extension Page 11

13 2.2 Loss of Businesses/Employment The acquisition of land by FDOT for the Flyover included 34 parcels totaling approximately 13.5 acres at the intersection of US Highway 17/92 and SR 436. Some of these parcels are grouped together under common ownership resulting in 26 separate transactions. The transactions included 18 that acquired the entire property and another 8 that are partial takings. Included in this total are 14 businesses that were forced to close with an employment figure of approximately 64 persons. The loss of property used for the Flyover is estimated at nearly $26 million in current valuation. This property will also not increase in value in the future due to its use for the Flyover. Therefore, the future impact on the CRA is magnified. Figure 5-3 illustrates the Flyover at the Intersection if US Highway 17/92 and SR 436. Exhibit 2-2 Aerial View of Flyover with Ramps 2.3 Reduced Access for Certain Properties The construction of the Flyover impacted properties located along US Highway 17/92 due to the ramps required for the structure. Access was reduced for those properties near the intersection since the direct connection to the US Highway 17/92 roadway was lost. The most significant impact of this loss of access is for the properties located on the Northeast corner of the said intersection. This property contains the Casselberry Exchange (one of the most prominent commercial sections of the CRA). 2.4 Impacts on Marketability The values of the properties adjacent to the Flyover have been negatively impacted due to loss of visibility and accessibility. Many businesses located along busy arterials rely on attraction of potential customers that pass by their doors. With the Flyover, this opportunity is not available to these enterprises. Exhibit 2-5 illustrates the properties that will experience a loss of visibility and accessibility. Casselberry CRA Extension Page 12

14 Exhibit 2-5, Properties impacted by Loss of Visibility and Accessibility (Indicated in Red) A quantitative measurement of the loss of marketability is not possible, at this time as the flyover is relatively new in operation. However, the area has already experienced a reduction in lease rates, or a decline in the amount of future rates. For income producing assets, the reduction in lease rates will generate lowered Taxable Values. Lease rates could increase with the new construction of Casselberry Bainbridge Apartments, now under construction on the old Walmart Site north of Casselberry Exchange. SECTION 3 - BENEFITS OF THE CRA The Casselberry CRA has exhibited significant success over the years in addressing slum and blight conditions and promoting Economic Development. Some of the more successful programs are described here. 3.1 Incentive Programs The CRA has provided incentives to attract users to the area with great success in the past. Each individual project should be reviewed by the CRA in terms of the value to the area. This review should include all benefits such as increase in tax base, number of jobs created, levels of pay of jobs created, potential spin-off effects and other governmental revenues generated by the project. The CRA should only provide funds for projects that will create lasting impacts on the area such as construction or reconstruction of a facility and public improvements such as roadway or water/sewer improvements. Incentives can take many forms to create these impacts and may include (but not be limited to): Casselberry CRA Extension Page 13

15 1. Contribution toward infrastructure improvements such as water and sewer or roads 2. Providing a One-Stop Shop for approvals 3. Waiving of impact fees Exhibit 3-1 Corridor Improvements Exhibit 3-2 Recipient of Incentive Funds through Land Development And possible infrastructure improvements Casselberry CRA Extension Page 14

16 Exhibit 3-5 Lands Acquired for Redevelopment Casselberry CRA Extension Page 15

17 Exhibit 3-6 Prior to Improvements Exhibit 3-7 After Improvements Casselberry CRA Extension Page 16

18 Exhibit 3-8 Examples of Median and Streetscape Improvements Casselberry CRA Extension Page 17

19 SECTION 4 - PLANS FOR THE EXTENSION The Casselberry CRA proposes to accomplish the following goals for the extension period. 1. Continue to acquire properties for future redevelopment 2. Complete the recommended capital projects, as funds permit. 3. Expand on the existing Lake Concord Park to spur further investment into the area. 4. Develop a marketing and branding program. PROJECTED CAPITAL NEEDS FOR CRA AREA Name Description Cost Land Acquisition Expansion of Lake Concord Park Purchase property around Quail Pond Circle and extend the existing Lake Concord Park to the north and east of City Hall $1,500,000 Land Acquisition Key Commercial Properties Purchase property at key locations to aggregate properties and participate in another Public/Private partnership to develop those properties $2,000,000 Parking Structure at Design and build a parking garage to provide parking for $4,500,000 Lake Concord Park employees of the city, residents, and local businesses Lemon Lane Signal A signalized intersection at Lemon Lane and US Highway 17- $1,500, Decorative Light Poles Installation of decorative light poles along US Highway $4,000,000 Development Create incentives for new development within the District $500,000 Incentives Pedestrian Bridge Design and build a pedestrian bridge over US Highway $3,000,000 Gateway Signs Monument signs at key locations along SR 436 and US $250,000 Highway Events Center Create a civic space where residents can gather and host events $3,000,000 Total Projected Capital Needs for the CRA $20,250,000 Financial Impacts of the extension and completion of the Redevelopment Program The district is experiencing a reversal of the decline in valuation in the future o Lake Concord Park, Bainbridge Casselberry Apartments, and several smaller projects are currently under construction, adding over 500 residential units to the area. o Taxable Value is expected to increase from $144 million in 2016 to $246 million in The district will maintain a positive Cash Flow throughout the timeframe of the extension due to phasing of capital expenditures. o The capital projects recommended for the district will be completed in 2025 due to cash flow issues. o The CRA will generate $9 million in TIF through the additional eight years lifetime. Combined with cash on hand, the CRA will have $7.9 million available Casselberry CRA Extension Page 18

20 to complete the necessary operations and projects. The expenditures through the additional eight years equal $7.9 million, allocated as follows: Operations - $1.1 million Capital Improvements and Incentives - $7.9 million The extension will allow the CRA to address economic development needs in the district and to assist in recapturing the business viability of the corridor. Casselberry CRA Extension Page 19