Pier funding will 'take funds from the general fund for Pinellas County' and St. Pete, says Ford

St. Petersburg Mayor Bill Foster and challenger Kathleen Ford tangled over paying for the Lens, the proposed pier replacement, at a debate last week. Foster said the money was use-it-or-lose-it, while Ford said the plan takes money from the city’s general funds.

"If we use (Tax Increment Financing) funding, that's going to take funds from the general fund for Pinellas County, as it will take funds from the general fund for the city of St. Pete," Ford said.

We decided to look into Ford's comments. (We'll look at Foster's in a separate fact-check.)

Let’s go back to 1969, when the Florida Legislature passed the Community Redevelopment Act. The intent was to allow a city and a county to target a specific geographic area -- say, a downtown -- for improvements. The law allows local officials to create a Community Redevelopment Area, so that a portion of property taxes collected in the area can be used for major development projects there.

In 1981, the city of St. Petersburg and Pinellas County set up such an area with the goal of paying for projects downtown. Each time the property taxes within the area rise above the 1981 level, that additional money goes into an improvement fund, usually called TIF, which stands for tax increment financing.

We should note that a pier project of some kind has long been on the drawing board. The inverted pyramid made its debut in 1973 and underwent a major renovation in 1987. Since at least 2005, city officials have been looking at either another renovation or a total replacement, paid for with TIF money.

Community Redevelopment Areas usually only last 30 years, and then the districts dissolve. But in 2005, the Board of County Commissioners granted the city a 30-year extension until 2035, said Ken Welch, a Pinellas County commissioner.

Ford’s point is that if St. Petersburg’s district didn’t exist, the property tax money would go into the city and county’s general funds.

But the district does exist, and that means TIF money is out of bounds for the city’s day-to-day operations or anything outside the downtown district, said Joe Zeoli, managing director of administration and finance in city development.

City leaders have never supported abandoning the pier without a replacement, Zeoli said. Though Ford doesn’t support the Lens design, she did advocate refurbishing the inverted pyramid at Tuesday’s debate. Refurbishment money would likely come from the TIF fund.

Right now there’s about $50 million in TIF money available for a pier project, with about $37 million of that intended for construction.  If the money isn’t spent by 2035, only then could the county reclaim its 44 percent share. The city would take the remaining money.

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Voters will approve or reject the Lens on Aug. 27. If the Lens fails and a different pier project goes forward, the same method of financing would apply, Welch said.

What had been coming from the general fund is a roughly $1.5 million subsidy for yearly operating costs for the now-closed inverted pyramid pier structure. The Lens would call for a $680,000 annual subsidy, as estimated by a third party, said Chris Ballestra, the city’s managing director of development coordination.

"Any new project including a revamp of the inverted pyramid would likely reduce that $1.5 million burden," Ballestra said, not just the proposed Lens.

If the new structure makes the surrounding property more valuable, then taxes in that area would go up and feed back into the TIF fund, said David Cruz, Florida League of Cities legislative advocate.

The TIF money means no money for pier construction comes from general city funds. It doesn’t raise people’s tax bills, nor does it come from money the city is allowed to re-appropriate.

Our ruling

Ford said that TIF money takes away money from the city’s general fund, implying that taxpayers would pay for the Lens with money that could be used elsewhere. Actually, the funds come from a special financing district, not from general funds. We rate her claim False.