by Bradley Parsons
Staff Writer
Plans to build the Duval County Courthouse by 2007 may be on hold, but its parking garage will be built on schedule, developers assured the City.
Metropolitan Parking Solutions’ plans to build a $26 million garage adjacent to the courthouse site got a kick start Thursday from the Jacksonville Economic Development Commission. The commission voted unanimously during its general meeting to ease insurance restrictions on $50 million in City-issued bonds. The move could save MPS about $10 million in interest over the 30-year life of its deal with the City and should clear the way for the developer to wrap up financing within the next three weeks.
MPS spokesperson Michael Munz said construction on the 1,375-space garage will begin by the summer of 2005 and will finish as scheduled by 2007. That’s around the same time that the City was supposed to cut the ribbon on its new courthouse. But those plans were thrown into limbo when Mayor John Peyton fired the construction manager for failing to keep the project within budget.
As Peyton heads back to the drawing board, it’s unclear when the courthouse could open or how big a building the City will build downtown. Earlier this week Peyton said he would consider a smaller downtown courthouse supported by suburban satellites.
Whatever happens with the courthouse, the garage would be a financial winner for the City, said Munz. In fact, he said the garage would perform better financially without the courthouse since MPS could charge market rates for spaces that would have had to be set aside for courthouse workers.
“Even if the courthouse is delayed, this garage will do very well,” said Munz. “It actually performs better based on strictly the private sector.”
The City is particularly interested in the garage’s prospects for success, because the City will share in the developer’s profits and losses. According to a $50 million deal with MPS to build the courthouse garage and two others around the Sports Complex, the City guarantees MPS an 8 percent annual return on the developers’ initial $3 million investment. If the garages don’t perform as expected, the City will issue low-interest loans to cover debt payments and ensure MPS’ profit.
In exchange, the City will share profits once the developer pays off construction debt. When the deal was approved, MPS estimated the City would earn $18 million. Those projections show the City would lose
$10 million to build and operate the garages itself. Now the City wants to make sure those numbers
haven’t changed.
JEDC Executive Director Kirk Wendland said he’d heard anecdotal evidence that private businesses around the courthouse site were interested in buying blocks of spaces. But he said he wants to know for sure that the finances haven’t changed before MPS starts construction. The JEDC may want to see those commitments in writing, said Wendland.
If the financial picture doesn’t look as rosy, the City could make changes to its deal with MPS, said Wendland. Talks will continue among the developer, Wendland and Peyton before construction starts next year.
Those talks could be complicated by an ordinance filed Wednesday by City Council members Lad Daniels and Warren Alvarez. The two have been frequent critics of the deal since they voted in its favor last year. Both said they made a mistake with their yes votes and filed a bill Wednesday that would remove the City’s support for MPS’ financing. Several other Council members said they’d be willing to give the deal another look.
Munz said the deal still enjoyed support from most of the Council and the mayor’s office. He dismissed the Daniels/Alvarez bill as a “last gasp attempt” to derail the deal.
“The mayor’s office and the majority of the Council has supported this because it has been, and continues to be, a good deal for the City,” he said.