by Bradley Parsons
Staff Writer
If developers spending City money don’t produce jobs and wages as promised, the reorganized Jacksonville Economic Development Commission could come looking for a refund.
A subcommittee charged by the mayor with reviewing how the JEDC tracks its incentive dollars recommended the City tie development grants to specific job and wage targets. The so-called clawback provisions are already widely used, but the new proposal would create standard ratios to be included across the board. Developers would know before they ever asked for money, how many jobs they would be expected to create and how well those positions should pay.
The subcommittee on reporting and clawbacks includes JEDC Commissioner Bob Rhodes, attorney Jeanne Miller and John Alderson among others.
The City should also use clawbacks when it gives away land, according to the report. When the City sells its property for less than market value, or if land is given away, deadlines should be set. The committee recommended that projects not finished by deadline should revert ownership of the land back to the City at no cost. Partially built projects would be addressed on an individual basis.
If developers sell the land within a defined time period, the City should be repaid market value, according to the report. The City would have the right to take back the land if not repaid.
The report is the first tangible product of the JEDC’s review of its operations. Mayor John Peyton challenged the commission in February to streamline itself. Addressing the Feb. 13 general meeting, Peyton said he wanted a leaner organization focused on job growth, rising incomes and a broader tax base. The review is split among four committees that will examine every area of the JEDC.
Commissioner Brad Glass of the Auchter Company is leading the review of the commission’s business recruiting. His subcommittee will identify desirable businesses and the kind of incentives necessary to lure them to Jacksonville.
Commissioner Susan Hartley’s committee will look for ways to make the commission more user friendly for small businesses. JEDC spokesperson Jean Moyer said the commission in the past has spent its incentive dollars on big projects, which bring in large amounts of jobs.
Downtown Development Authority chair Bob Rhodes will lead the look into downtown development. Commissioner Charles Appleby’s committee will examine the financial structure of the JEDC’s incentive packages. He said at last week’s general meeting that he wants to raise interest rates on City-issued loans. Appleby received a copy of the reporting subcommittee report following the meeting.
JEDC executive director Kirk Wendland said the commission will also review the size of its staff. He said the recommendation for a reorganized staff should be presented to the commission in two to three months.
The reporting subcommittee found the commission had a difficult time getting developers spending City money to file reports detailing how the money was spent. Once a project is funded and clawback deadlines have passed, the subcommittee found that developers “rarely comply” with reporting requirements that are viewed as voluntary.
To fix that, the subcommittee recommends making the reports mandatory and telling developers so in incentive contracts. Failure to submit the reports would cost the developer financial penalties that could total 5 percent of the total incentives up to $10,000. The minimum fine would be $2,500.