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Roundup 2-1-2013

February 1, 2013

Bass Pro Shops – One More Thing, Retail Does Not Need Help

Previously, we have laid out most of the arguments against the Bass Pro Shops deal. (Among other places, see here and here)  One of the recurring arguments made in favor of the deal is that not all jobs can be biotech or high paying jobs.  That is true, but it does not answer the question of whether taxpayer money should go toward retail, hotel, and other lower paying jobs. Well,

The retail business has roared back to life in Florida, recovering faster than almost any other industry and providing jobs to Bliss and thousands of others. But the trend also points to a problem with Florida’s post-recession economy: Three years into the recovery, Florida has become more dependent on the lowest-paying jobs.

Nearly half of all the jobs created in Florida after the recession ended in 2009 are in retail and leisure/hospitality, two industries associated with low pay. By comparison, those same industries were responsible for less than a quarter of jobs created in the years after two previous recessions, in 1991 and 2001.

* * *

Retailers have added 71,200 jobs in Florida since 2009, recapturing 75 percent of the industry’s jobs lost during the recession. The leisure and hospitality industry has added 73,400 jobs in the past three years and now employs more people than it did before the recession.

In other words, retail does not need any help – and neither does hospitality.  What needs help is the rest of the economy – especially higher paying jobs which will create the need for other services, including more retail and the hard hit construction industry. A diverse economy with high wages will do a much better job of supporting retail and construction.  (If the real estate based economy could not consistently support construction, more real estate based economy is not the answer.  And housing is coming back – slowly – anyway.).

Just more reason taxpayer money should not be spent on this deal.  The County Commission should reject the proposal.

Economic Development – The Rich Getting Richer

We often discuss economic development in the Tampa Bay area and say we are not pursuing what we need.  For instance, for years, we have pursued back office operations, often of financial companies, leading some to call us “Wall Street South.”  This week we discovered that Palm Beach County is actually working on being Wall Street South.

An increasing number of financial firms, especially private equity and hedge funds, are fed up with New York’s sky-high city and state tax rates and are relocating to the business-friendly climate in Florida’s Palm Beach County.

And they’re being welcomed with open arms — officials in Palm Beach recently opened an entire office dedicated to luring finance hot shots down south.

“Florida is a state of choice,” said Thalius Hecksher, global development chief for Apex Fund Services, who moved many of his operations to Palm Beach. “It’s organically grown. There’s no need to drag people down here. It’s a zero-income-tax jurisdiction.”

Ok, so there is a tax draw (which is probably the actual point of the New York Post article), but we have that, too.  What efforts has Palm Beach made to recruit these folks?

“We’re not doing a multimillion-dollar marketing campaign. We don’t need to,” said Kelly Smallridge, who heads the Palm Beach County Business Development Board, which set up the special unit to handle inquiries and marketing.

“They’re coming to us.”

Without warning, Smallridge said, her organization only recently started getting inundated with hedge-funders.

“The door was open because of the high-tax environment” in the New York area, Smallridge said.

So, Palm Beach is doing basically nothing other than being helpful to people inquiring.  Look, we lack venture capital, which is easier to get if more people with the money are here all the time.  We also need high paying jobs.  What are we doing to tap into this trend?

Brand Tampa Bay/Coming Out Watch

Of course, Palm Beach has that schmancy reputation.  What about us? This week we have a little video clip that really goes to both the problems with branding Tampa Bay and our continuing coming out watch.  Dave Barry (of Miami) was on Morning Joe on MSNBC to discuss his new book. As part of a wide ranging conversation with the panelists, one posed this question at 4:25 of the video:

“You said you went to the conventions. What’s the deal with Tampa?  Like, why do people live there?” 

(He basically ducks the question.)  Nice.

In the interest of full disclosure, we note that the New York Times had a book review this week that included this nugget:

Mr. Huang, who was born in 1982, grew up in Orlando, Fla., America’s least interesting city, where wit and soulfulness run afoul of zoning laws.

Of course, we are not really sure that helps the Tampa Bay area any, given that we are even less developed when it comes to planning.

Rays – It’s a Mad, Mad, Mad, Mad World

This week we saw more wackiness in the Rays stadium saga.  After last week’s visit by the Rays to the Hillsborough County Commission, there were some strange goings on in Pinellas, including a Rays visit to the Pinellas County Commission.  First, we want to get this fact out of the way:

The Rays said fewer than 300 full-season ticket holders live in St. Petersburg — representing a total of about 800 to 900 seats per game.

“Season tickets are the lifeblood of any organization in baseball,” Sternberg said. “We are able to make long-term decisions based on them.”

In other words, St. Pete does not support the Rays.  In truth, this is a pathetic number, even if we acknowledge that is may not cover partial season tickets.  Maybe before the Mayor of St. Pete says the area should support the Rays he should address his own city.

Now on to the events. First, there was a heated discussion at the St. Pete City Council. Then, the Mayor of St. Pete kept up his Rays monologue:

Foster, who has become the symbol of opposition to relocating the Rays, admitted to having an “emotional outburst” during an interview with Ron Diaz on WDAE Friday morning, when he said he had been beaten up over the stadium issue and that, if it was just up to him, the Rays could “just go already.”

But he maintained that the Rays have a duty to honor St. Petersburg’s two-decade effort to attract a Major League Baseball team and the city’s investment in the Trop.

“I think the consensus is I’m not well-regarded in Tampa Bay,” he said. “You know what? I’m not the mayor of Tampa Bay. I don’t have a fiduciary duty to Tampa Bay.”

First, the Mayor is not against “relocating” the Rays.  He is against finding a solution to the stadium issue.  Anyone who follows sports knows that “relocating” means the team leaving the metro area in which they are located – here the Tampa Bay area – which the Mayor is not helping avoid.

Second, it is true, Mr. Mayor, you do not have a fiduciary responsibility to Tampa Bay, but you do have one to St. Pete and having an empty stadium is not really helping St. Pete. Moreover, as years on the lease go by, attendance stays low, the Trop is paid off and funding sources dry up, St. Pete’s leverage is decreasing every day.  And fiduciary duty does not mean stubbornly holding onto a poorly performing investment.  Fiduciary duty involves protecting that investment, which can be achieved in many ways, such as making a deal to allow the Rays to look in other places for a price and redeveloping the Trop land.  This was brought up by many recently, including one Pinellas County Commissioner:

Kalt delved into one topic of interest to both commissioners and St. Petersburg council members, who sat in the audience: Putting the Trop’s 84 acres to use if the Rays move elsewhere.

“The cost of inaction is just not about baseball,” Kalt said. “One thing that gets lost is the redevelopment potential of the Trop. It is sitting on an enormous piece of land in a rapidly growing downtown that has real value and is frankly lying fallow.”

“The debt service (on the Trop) pales in comparison to what can come from property and sales tax generation if you put that land to use,” he said.

All true.  This was amplified by another Commissioner.

That seemed to resonate with Welch, who noted that about 500 people lost their homes when the Trop land was originally assembled out of St. Petersburg’s Gas Plant neighborhood. People who lived in the area were promised jobs that never materialized.

Welch suggested that the Rays might break the stalemate by offering St. Petersburg monetary compensation for letting them look in Hillsborough, then “a larger check if they ultimately decide on a site other than Pinellas County.”

That money could be used to help build a new police station or a small convention center, “something that creates jobs and gets back to the original plans of the Gas Plant relocation,” Welch said.

Completely reasonable idea.  What did the Mayor of St. Pete say?

Foster reacted with disdain that the Rays would use Trop redevelopment to justify leaving town.

“Now they are looking out for St. Pete’s best interests?” he said sarcastically. “If we wanted to redevelop that into an International Mall, we would have done that. But in 1980, the people of St. Petersburg decided that Major League Baseball was important.

“The only reason that Mr. Sternberg is one of the elite 30 (baseball owners) is on the backs of the people of St. Petersburg.”

First, that is not exactly true – Pinellas County also paid for the Trop. Moreover, the very low St. Pete ticket support shows that the people of St. Pete do not think baseball is important.

And the reality is that fiduciary duty has nothing to do with the Mayor’s stance.  We take you back to this quote from the October 26, 2012, letter of the Mayor of St. Pete to the Rays denying their request to look outside St. Pete:

Not only are the Rays a source of great civic pride – you are a partner, employer, economic driver, tourist attractor, philanthropist, and, yes, a great escape as our residents get lost in the game of baseball. Make no mistake. This is not about money, and the City has absolutely no interest in “winding down” our relationship prior to 2027.

That says it all – it is not about fiduciary duty.  It is city rivalry and pride.

A Pinellas County Commissioner stated the obvious, thankfully:

“All those years of trying to get a team here; I was cheering when they came, but it hasn’t worked,” said Pinellas County Commissioner Susan Latvala.

“Having them die on the vine in St. Petersburg is not good for anybody.”

Right.  It is not good for anyone, including St. Pete, which has other things to deal with, like Midtown, where the City sank a good chunk of change and is losing an anchor grocery store  (here and here), the problems with which the Mayor may or may not have known about over a year ago, along with the poor financial health of developers chosen for public projects in Midtown.  (Not surprisingly, the Mayor of St. Pete’s strong powers of persuasion were unsuccessful in getting Sweetbay to agree to keep the store open.)

And another Pinellas County Commissioner stated the obvious, which unfortunately never seems to occur to the Mayor of St. Pete:

“The notion the Rays will be in Tropicana Field through 2027 is not a realistic one,” said Commission Chairman Ken Welch, who wants the team to stay in Pinellas. “The discussion needs to be what is the strategy going forward. That discussion can’t happen until St. Pete and the Rays come to some agreement.”

Indeed.  And the Rays proposed a new way to do that while giving St. Pete the first look, though we doubt the Mayor of St. Pete will agree.  There is also now quite a bit of support for a regional discussion. (see here and here)

But, as with all efforts to date, the Mayor of St. Pete and his misplaced pride is the roadblock.

Trying to Do the Right Thing

There was an interesting article in the Times this week about a Hillsborough County Commissioner who is being criticized by his own party.

We are not going to detail the whole article (You can read it here).  What we will say is that, while we do not agree with the Commissioner on everything, at least on many issues he is willing to address issues in the way he thinks is best, even going against his party. (we will not speak to all issues.) We hope that becomes more widespread.  The Tampa Bay area needs more practical solutions, rather than “ideological purity.”  Otherwise, we risk being left further behind our competitors.

HART/PSTA – Yada Yada Yada

Of course, not all decision makers in the region are practical. This week the boards of HART and PSTA met once again and the outcome was predictably messy.

“If you look at what the press has written over the past two months, it looks like we’re two cowboys in the old saloon and we’re ready to take the gunfight outside,” said Hillsborough County Commissioner Sandra Murman, who sits on HART’s board. “But that isn’t the case.”

Despite their disagreements, the chairs of both boards agreed to move on.

“I think this has been a good exercise,” said St. Petersburg City Council member Jeff Danner, the PSTA chair. “We’ve learned a lot about each other.”

“I think we have a really good opportunity to move forward,” said HART chair Fran Davin.

Sounds good (and, yes, we have learned a lot about the boards), but . . .

Beneath the niceties, however, remains a serious schism about merging their operations, finances and resources. Which is why both boards voted to send the same report sent to lawmakers with two different resolutions:

HART’s brief resolution calls for both boards to keep meeting, identify projects both agencies can examine together and start setting benchmarks and policies toward “continued collaboration.” But HART’s resolution doesn’t mention consolidation at all.

“We are way away from a merger,” Davin said afterward.

The stubborn provincialism and disregard for taxpayers’ interest of the HART board makes you wonder if they are being advised by the same people as the Mayor of St. Pete.  Anyway,

PSTA’s longer resolution calls for improving regional “connectivity.” It would support the Legislature funding more consolidation studies and calls for a “proactive regional coordination role” for the Tampa Bay Area Regional Transportation Authority.

Which is totally reasonable. So, of course, HARTs board had problems with it.

But there was still disagreement over what to send to Tallahassee. TBARTA drafted a letter to the Legislature saying the regional agency wants a bigger role in future discussions. PSTA wanted the TBARTA letter included in the report. HART balked.

It is not surprise that the HART board balked.  They already balked when they agreed to further study and they changed their mind.  Anyway, what s the deal with TBARTA?

Tension between HART and the Tampa Bay Regional Transportation Authority had ratcheted up again last week after TBARTA wrote a draft letter to send to the Legislature. In the letter, the regional authority expresses disappointment that HART and PSTA did not achieve a joint recommendation.

The TBARTA proposal also sounds reasonable, but, as we have seen, reasonableness is in short supply at HART’s board.  Then there was this:

Tampa Mayor Bob Buckhorn responded by sending an email to TBARTA’s executive director saying he did not support the language in the draft letter.

“I believe there are ways for this process to move forward, but it is my opinion that TBARTA’s continued search for viability would be better served in some other arena,” said Buckhorn, who is a TBARTA board member.

Huh?  TBARTA is supposed to be a regional transportation agency.  If it is not involved in a major discussion of consolidating regional transit, what other arena should it be involved in?  And what are the ways “this process” can move forward?

Only in the Tampa Bay area would the largest county – Hillsborough – work so hard to avoid working regionally on something that can only make it more central.

And what is even worse was this statement from the Chairwoman of HART’s board:

It is HART’s mission to provide transit service to Hillsborough County residents. While HART partners with nearby transit agencies to lead and improve regional connections, protecting and expanding our local service used by thousands every day to get to work is our priority. So when state legislation in 2012 mandated a study for the potential consolidation of HART and Pinellas Suncoast Transit Authority (PSTA), the bottom-line question was: Does a merger improve or deliver more services for our constituents? 

The study concluded: “There are virtually no areas of duplicative service, and therefore, there are no cost-savings opportunities in service.” The study noted that a merger would be very costly and time consuming, with benefits that could be achieved through an informal partnership between our agencies. In fact, of the areas identified in the independent study for future collaboration, none add additional bus service to our counties. For that reason, shifting our limited resources towards the formal consolidation of the two agencies at this time does not appear to enhance services to riders, which is our primary goal.

While it is technically true that the report said there are not many areas of duplicative service, the report said there is potentially significant savings – far outweighing the costs of merger – in staffing, though a further audit is necessary to get exact numbers. (See here, pg 23)   Money is fungible.  That saved money can go to service.  In sum, the statement on HART’s website is just not true.  It makes sense to have a further study.

This would all be funny if it were not so sad.

Downtown Tampa – Enter the Library

This week we learned something new:

The Friends of the Library of Tampa-Hillsborough County is concerned that Mayor Bob Buckhorn’s vision for downtown Tampa could make it harder for patrons to get to the John F. Germany Public Library.

“Scarcity of parking has been an issue for the library and downtown area for many years,” friends president and former County Commissioner Jan Platt said in a Jan. 25 letter to Buckhorn. “We feel the library deserves a place at the table to discuss how the development will affect its users.”

Ok, we admit, we did not see that coming.  Sure, the library should be considered, but not necessarily as its Friends think.

Platt said Thursday she foresaw two potential problems looming for the library.

One is the planned 36-story apartment tower that developers Greg Minder and Phillip Smith have proposed building immediately behind the library’s annex.

* * *

Parking is bad already, Platt said, and “that high-rise will only make the parking situation worse.”

* * *

Moreover, she notes that drawings included in the InVision plan portray another new skyscraper on what is now a parking lot at the southeast corner of Cass Street and Ashley Drive. That would squeeze parking even more, she said.

It is probably true that parking for library patrons is tight, but we do not think blocking development and keeping the area less than inviting is a solution.  We certainly do think maintaining large surface lots downtown is what we need.  What is the second concern?

The second concern is for the annex itself. Buckhorn’s recently completed InVision Tampa development plan for downtown mentions at one point that an early next step in the planning for the northern part of downtown should be to “examine the library annex as a redevelopment site.”

While we have no knowledge of plans to redevelop the annex (which does not mean there is not activity behind the scenes), and, frankly, we think that lot on its own is not really an attractive lot, we do not think this is a problem.

The real problem is the outdated building the library is now in.  We understand support for the library – we support having a good library.  In fact, we support it so much we would like a long term plan (we don’t advocate breaking the budget) to replace the present building, and not necessarily on the same lot, though it should be downtown.

We understand the Friends of the Library’s concerns, but the solution is not maintaining the status quo.  It is working to make everything better.

Moffit Growing

The Expansion of the Moffitt Cancer Center is getting under way.

From the Times – click on picture for article

The H. Lee Moffitt Cancer Center and Research Institute will kick off construction of a $74.2 million outpatient facility Friday, culminating more than five years of planning.

The eight-story building will be located about a mile from Moffitt’s main facility, on the cancer center’s 30-acre property on N McKinley Drive. It is the first addition since Moffitt’s for-profit subsidiary, M2Gen, opened its facility there in 2009.

The new outpatient center will include clinics, an ambulatory surgery center, imaging facilities, research labs and space for blood draws.

The facility is scheduled to open in February 2014.

While we think it would have been optimal if the new building was connected to the existing campus, this can be nothing but good for the area.  The Moffitt Center is an established, advanced cancer research facility.  Its expansion will not only help it become better, it will serve the community, create more higher paying jobs, help the construction industry, and spin off more work – hopefully attracting more research and innovation.

While we are not obsessed with biotech, we are certainly not opposed.  This is good for all.

Economic (Lack of) Performance

We found this interesting list of relative economic performance of various sectors in the State of Florida. It is worth perusing.  While numbers can be manipulated in various ways, one thing to note is that the first entry for Tampa is quite far down on the list.

List of the Week I

Our first list of the week is the Forbes list of the Top Cities Where People Are Moving. The number one city is Dallas-Ft. Worth followed by Miami and Austin.  Fourth is the Tampa Bay area followed by Houston.

We find that a bit surprising, but good.  No wonder retail is taking care of itself.

List of the Week II

So our second list of the week is the Forbes list of the Top Cities for Job Seekers. The top 10 are: Austin, DC, San Francisco, Denver, Houston, Ft. Worth, Dallas (they split them), Seattle, San Antonio, and Charlotte.  Florida was shut out.

Now we need to get those people moving here good job opportunities.

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