by Bradley Parsons
Staff Writer
Private developers will pay $5.7 million for three downtown land parcels to build, own and operate parking garages around the new Duval County Courthouse and the sports complex.
The new price is the result of a compromise between City planners and Metropolitan Parking Garages that preserves the developers’ ability to set market–based parking rates in exchange for taking on increased financial risk. The previous deal guaranteed the developer a 10 percent investment return and agreed to convey the land for a dollar.
The City Council found those terms unacceptable, leading to a series of meetings between MPS and the Jacksonville Economic Development Commission. The negotiations continued through last weekend and arrived at terms that all parties agreed were more favorable for the City.
The new agreement reduces MPS’ guaranteed return to 8 percent and makes a City buyout of the garages more viable.
“This is a better deal now,” said Finance Committee chair Warren Alvarez. “If the deal had remained as it was, it wouldn’t have passed this committee.”
The deal passed the committee unanimously. If approved Tuesday by the Council, MPS documents said the 480–space Veterans Memorial Arena garage and the 1,000–space sports complex garage would be open in time for the 2005 Super Bowl. The 1,375–space courthouse garage would be ready for the courthouse opening in 2007.
The new agreement calls for the City to loan MPS the money to buy the land at 2.85 percent interest. That debt would be added to $50 million in tax–exempt bonds issued by the City to MPS to build the garages. The City bought the land for $5.7 million.
“It’s assured we’ll get back the real estate cost,” said Council Auditor Richard Wallace, who was skeptical of the original agreement and helped negotiate the compromise. “There’s been good movement from the developers on this deal. I’m more comfortable with it now.”
Wallace said MPS will still set rates for the garages. After MPS proposed a near fourfold hourly rate increase over current City garages, Wallace suggested taxpayers may be better off under City ownership and management.
The new agreement makes no mention of rates, which MPS had proposed at $3 for the first hour and $2 for additional hours for the courthouse garage. MPS documents say that market–rate pricing is in keeping with downtown master plan guidelines. Private ownership will also put the garages on the City’s tax rolls, said Wallace.