At a marathon five-and-a-half-hour meeting Wednesday, the Pensacola City Council gave final approval to a multimillion-dollar property tax incentive for a major downtown development.
Council members voted 6-1 to approve the incentive on its second and final reading, with Council President Charles Bare switching his vote from last month to join the majority, and Councilman Larry B. Johnson absent.
The $50 million project, on the site of the former Pensacola News Journal headquarters, is expected to add more than 250 residential units in the downtown core, along with retail space, offices, and a public/private parking garage. Quint and Rishy Studer purchased the property in 2013 and are redeveloping it under their Daily Convo LLC.
The incentive — called an EDATE, or Economic Development Ad Valorem Tax Exemption — exempts property owners from paying taxes on the value of improvements to a property. In Daily Convo’s case, the incentive could be worth $2-3 million over ten years.
Quint Studer couldn’t attend the meeting due to a business trip, but asked a representative to read a letter to council members. Without the incentive, Studer wrote, the project would “absolutely not move forward in its current form.” Studer warned that, should council members not approve the incentive, the project would have to “start over” with lenders, suffer delays, and likely see an increase in proposed rental rates.
At one point, tempers flared in the council chambers when Councilwoman Sherri Myers reminded Daily Convo attorney Robert Emmanuel of his ethical obligations under the Florida Bar amid a disagreement over a legal interpretation. Emmanuel said that he “personally resented” Myers’ insinuation, but Myers — herself an attorney — continued to persistently question Emmanuel, along with city staffers. Later in the meeting, Councilman Brian Spencer called on council members to maintain decorum, calling Myers’ tone “unacceptable” and “not appropriate or necessary.”
“I am passionate,” said Myers, “and I don’t apologize one bit.”
Despite council approval, incentive still uncertain
The council’s vote Wednesday may be the final hurdle at City Hall, but the EDATE isn’t yet guaranteed due to lingering questions about whether the project qualifies for the incentive.
As we reported earlier on Wednesday, Escambia County Property Appraiser Chris Jones has “not made any final determination regarding whether Daily Convo qualifies,” and has said that such a determination will depend on an opinion from the office of Florida Attorney General Pam Bondi, which Jones’ office requested last month. Officials in Bondi’s office told Pensacola mayor Ashton Hayward last week that they hoped to issue an opinion before the end of the year.
The Daily Convo project doesn’t meet the state’s qualifications for the EDATE incentive, but the project may qualify due to its location within a so-called “enterprise zone,” under which cities and counties have had great latitude in awarding incentives. However, Florida’s enterprise zone program will expire at the end of the year, and some council members have questioned the project’s continued eligibility.
County commissioners to consider incentive tomorrow
The city council’s action tonight would only exempt the project from paying city property taxes, but Escambia County commissioners will consider their own EDATE incentive for the project on Thursday evening.
Given the short timeframe until the enterprise zone program expires, commissioners are being asked to waive a ten-day notice requirement and adopt an emergency ordinance. A recommendation on the meeting’s agenda asks commissioners to grant either a 100% property tax exemption to the project or a 38.46% exemption based on the project meeting 5 out of the county’s 13 EDATE criteria.
The county incentive could be worth as much as $3.8 million over ten years, bringing the potential full value of city and county property tax incentives for the project to $6 million or more.