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Roundup 8-3-2018

August 2, 2018


Transportation – Odds and Ends

— HART Money

— Downtowner

— Ferry

— Brightline

Airport – Good Marks

Economy – Inequality

Economic Development/Tourism – Hotel Outlook

Economy – Office Rents

Built Environment – Outdated

USF – Stadium Talk

Schools – Taking the Lead

Westshore-ish – More Midtown

Red Light Cameras

An Interesting Read on Urbanism


Transportation – Odds and Ends

— HART Money

It is no secret that HART is woefully underfunded by the County Commission (which has no problem spending on road projects hundreds of millions that were apparently just lying around).  Last week, the Commission made a very modest move to correct the situation.

Hillsborough County commissioners plan to give an extra $2.1 million to the county’s cash-strapped bus agency to increase the frequency of buses on some of its most popular routes.

But the money comes with conditions that could mean replacement of the agency’s top executive.

First, it is good that the Commission is providing some funding for some frequency increases (though it is unclear if it will be recurring or one time).  The frequency (or lack of it) of HART’s buses is a major issue.  The money is not enough, but it is something, which is better than nothing.  Regarding the aforementioned conditions:

Commissioners voted unanimously Thursday to earmark the money for the Hillsborough Area Regional Transit but only if the agency conducts a statewide and, if needed, nationwide search for a new chief executive officer. They also want the agency to seek additional funding from the city of Tampa.

The idea came from Commissioner Les Miller, who stressed that it’s not a vote of no confidence in HART interim chief executive Jeff Seward. But Seward’s position has become increasingly shaky in recent months, culminating in a July 16 meeting when six of HART’s governing board members — including Commissioners Sandy Murman and Stacy White — voted to search for a new CEO. The vote ended in a tie, meaning it failed to pass.

Miller, who also serves on HART’s board, has frequently voiced his support for appointing Seward on a permanent basis. He said agreeing to a search was a compromise to get HART extra funding it desperately needs. He hopes Seward will apply.

* * *

The uncertainty over HART’s leadership comes at a critical point for both the agency and the future of transportation in Hillsborough. If successful, a citizen-led ballot initiative to raise sales tax for transportation would increase HART’s annual budget from $70 million to about $200 million in 2019. The agency would be in charge of developing a transit system linking the University of South Florida, downtown Tampa and Westshore.

Seward is contracted to serve as interim CEO through November. He was promoted from chief financial officer to replace Katharine Eagan, who left after three years at the helm.

At the HART meeting, with Seward sitting at their side, several board members said the agency must look to appoint the best person possible to lead the agency.

* * *

Murman said Seward does not fill the shoes of Eagan in terms of his qualifications. HART could have an influx of millions of dollars from the transportation initiative and needs a leader who will “move and shake the Earth as far as transit is concerned, she said.

“Are we ready for that? I’m not sure,” Murman said.

Setting aside that we are not sure the HART board as a whole is really ready for an influx of money, we are not opposed to a leadership search (provided it is not just a means to give profits to an executive search company).  As for whether the present CEO fills the shoes of the past CEO, it is difficult to measure because of his short tenure and all the pressure put on the agency by the funders, namely the County Commission.  However,

At the HART meeting, with Seward sitting at their side, several board members said the agency must look to appoint the best person possible to lead the agency.

Among those expressing the sentiment were Kathleen Shanahan, a businesswoman and former chief of staff to former Gov. Jeb Bush, who said it seems Pinellas, not Hillsborough, is leading the region in transportation.

That certainly seems to be the case. For whatever reason (and we have a number of ideas), the Commission shows little interest in real transit solutions, whether normal bus routes, real BRT or rail.  It is hard to fault HART as an agency for not coming up with really ambitious plans when it is quite clear that the Commission is just not going to fund them.  Nevertheless, it is true that PSTA seems more ambitious.

Regardless of which agency is leading, the County needs to provide the funding and search needs to be done. There is much work to do.

— Downtowner

There was news about the Downtowner, the publicly supported free shuttle downtown:

On Thursday, July 26, 2018, City Council approved the Tampa Downtown Partnership’s request for $600,000 in funding for year three of the Downtowner ride service. The funding is a combined contribution from the City of Tampa’s Downtown and Channel District Community Redevelopment Areas.

* * *

The app-based, on-demand ride service is the first of its kind in Downtown Tampa, moving over 324,999 riders since it launched in October 2016. Growing ridership in the first year of the program lead Downtowner to launch new tech advances and increase its fleet of vehicles.

* * *

The service is made possible through the generous support from both the public and private sector. The City of Tampa’s Downtown and Channel District Community Redevelopment Areas have been key partners. Others include: FL Department of Transportation, SPP/Lightning, Marriott Waterside, Hilton Tampa Downtown, Aloft, Barrymore Riverwalk Hotel, Embassy Suites Tampa Downtown, Le Meridian Tampa, Park Tower, Bank of America Plaza, Tampa City Center, Franklin Exchange, Rivergate Tower, 100 North Tampa, Fifth Third Center, SunTrust Financial Center, Two Harbour Place, and the University of Tampa.

It is the first of its kind in the sense that it is app-based and uses money from the CRA.  In terms of being a free electric shuttle downtown, not so much. (See here and here)  But anyway, it is good the service is proving popular.

— Ferry

Speaking of CRA money,

The Tampa City Council, meeting as the Community Redevelopment Agency, approved spending $150,000 Thursday, its share of the $600,000 public subsidy to bring back a seasonal ferry connecting St. Petersburg and Tampa.

St. Petersburg Mayor Rick Kriseman made the pitch to council members, saying the ferry was a small part of a solution for the area’s transit woes, but played a greater role in bringing entertainment dollars to both sides of the bay.

The ferry, he said, also helps break down the traditional suspicion between the bay’s two largest cities.

The CRA approved the money by a 4-2 vote. Council member Charlie Miranda and Chairman Frank Reddick voted against the proposal.

Reddick said he didn’t think the ferry provided enough jobs or appeal for his constituents in East Tampa to make it a worthwhile investment.

Miranda also questioned the use of taxpayer money for  a “joyride,” a reference to the fact that at least 2/3 of the ridership in its inaugural 2016-2017 winter and spring season rode it for recreation. Kriseman said anyone who rode the ferry during the week was counted as a commuter.

The use of CRA money is interesting.  Using it does not take more money from taxpayers, per se, which is good. On the other hand, if the money is used for the ferry, it is not used for something else in downtown Tampa.

While ferries can be useful transit, the Cross Bay ferry is more of a fun cruise than transit. It is ok to use some CRA money to support an attraction that people appreciate, but, with growing demands for the money, the ferry really needs to show more value (which probably requires using more than one boat) or become self-supporting.  This service should not be subsidized in perpetuity.

— Brightline

There was, maybe, a little more detail on possible Brightline routes:

State Sen. Linda Stewart (D-Orlando) says any future high-speed expansion is expected to originate at Orlando International Airport’s new intermodal terminal.

Service to Tampa will then likely run parallel to either State Road 528 or State Road 417 as connectors to Interstate 4.

I-4 will be used as the primary link from Orange County to Tampa.

The important thing for this area is that any route will be basically coming down I-4.  Though, if you think the project will all get started quickly:

Stewart says a new study will have to be conducted to determine the feasibility of high-speed travel for the route and which method works, pointing to various environmental challenges along the I-4 corridor.

“In certain areas where we can’t be on the ground, we’re going to have to bridge over, where there are rivers or streams or lakes, so there’s a lot to consider before we move forward,” Stewart said.

Additionally, Stewart says some past right-of-way options no longer exist, and there is no determination of where in Tampa a station could be built.

We are assuming for now that any potential station in Tampa will be downtown, which is good for Orlando’s airport, but not ours.  (We would like a downtown station but, with no real connection to our airport while connecting to Orlando’s airport, there is a problem.  Ideally, the line really should run between actual cities, but that seems very unlikely.)  In any event,

Brightline hopes to win a bid to allow it to expand the service in the future from Orlando to Tampa.

However, the company is not alone, according to Stewart.

“I’ve heard of four,” Stewart said. “We have new technology and new people on the block wanting to make a bid.”

We shall see.

Airport – Good Marks

With the expansion of service, the ongoing rebuilding/renovation, and strong passenger numbers, this is not surprising:

Tampa International Airport president and CEO Joe Lopano has gotten another round of top ratings from his bosses on the Hillsborough County Aviation Authority board.

In fact, board members gave Lopano near-unanimous ratings of 5 out of 5, or “outstanding,” in 14 different areas of job performance for an overall average score of 4.99 out of 5.

* * *

The lone exception was Hillsborough County Commissioner Victor Crist, who gave Lopano a 4, or merely “exceptional,” for Lopano’s work at conveying industry trends and developments to the board and to local constituents.

The high marks lead to this:

. . . the aviation authority board is scheduled to consider a raise for Lopano, whose base compensation currently is $452,897 annually, plus a car allowance of $1,000 per month. Also, an amount equal to one-third of his base salary goes to deferred compensation that he will only receive if he stays in his job until April 4, 2021.

That is a lot.  However, to get results, especially to overcome the effects of decades of complacency, you need talent. To get and retain talent, you need to pay.  Moreover, given that the money comes from the airport and not the taxpayer, as long as results are good, it makes sense to consider a raise (contingent on the terms).

In other news, the airport is seeking contractors regarding expanding the growing cargo operations:

“The project will expand our cargo operations as well as our MRO [maintenance, repair and overhaul] operations near the existing FedEx cargo operations and PEMCO hanger, located on the east side of our property,” [Communications Manager Danny] Valentine said.

Valentine said he expects the project to be complete in mid-2021.

They are also looking for contractors to prepare the site for the next phase of the master plan that includes the office building and hotel near the rental car garage.

And, finally,

Swoop, Canada’s first true ultra-low-cost carrier, announced on Thursday its entrance into the U.S. market with five new international flight routes, including one for Tampa.

* * *

Swoop will begin offering nonstop flights between Tampa and Hamilton, Ontario. The new flights begins Oct. 20 and will offer the route in three weekly services.

More routes are good.

Economy – Inequality

There was some interesting news about income inequality:

But in New York, Florida and Connecticut, the top 1 percent made at least 35 times as much as the average for the rest of the population.

In Florida, the top 1 percent had an average income of $1.54 million, or 39.5 times as much as the $39,094 average income for the bottom 99 percent.

The disparity is so lopsided in part because average Florida wages for the bottom 99 percent are well below the national average. Only six states had average incomes for the bottom 99 percent lower than Florida’s: Alabama, Arkansas, Kentucky, Mississippi, South Carolina and West Virginia.

In the Tampa Bay area, the top 1 percent had average incomes of about $1.1 million in 2015, or 30.4 times the $36,647 average income of the bottom 99 percent in the region.

The Tampa Bay area is the 34th worst metro out of 916 examined. (You can see the report here)  While it does not explain everything, it is worth considering that inequality and all it entails certainly may contribute to the persistence of our persistent issues.

Economic Development/Tourism – Hotel Outlook

There was an article in the Business Journal regarding the local hotel industry.

Currently, there are 1,800 rooms being built in Hillsborough and Pinellas counties. Virtually no hotels over 100 keys are under construction in Pinellas.

* * *

“There is tremendous opportunity in this market compared to other markets in the area,” Plasencia said. “The one segment we’ve been lacking in this market that markets like Naples, Miami, Palm Beach and Fort Lauderdale and Fort Myers have is luxury product. I’m talking about Regis-level assets and that’s coming. And I will tell you it’s coming sooner rather than later, I would say in the next three to five years.”

He added that in the next five years he expects to see luxury hotel brands like Fairmont, InterContinental, Loews and Omni.

Given the boom in tourism generally, we are not surprised that hotels are being built and the industry is doing well, though the lack of construction in Pinellas is a bit odd.  We would also not be surprised if, in addition to Water Street’s plans, higher end hotels get built.  We do not know if the speaker knows about specific plans or is just speculating, but more offerings would be nice.

The bigger question is how long the strong tourism numbers will continue and how bad a downturn will be when it comes. And where is that 6th percentage on the Hillsborough bed tax?

Economy – Office Rents

Let’s check in with office rents.

Rents for Class A office space during the second quarter of this year were up 4.5 percent in the Tampa Bay area compared with the same three months last year, the real estate firm Cushman & Wakefield reported this week.

Asking rents for Class A office space averaged $28.07 per square foot in Pinellas and Hillsborough counties and were as high as $39 per square foot for so-called “trophy” buildings — typically, the tallest, best-appointed downtown office towers.

Meanwhile, Hillsborough County’s overall office vacancy rate has fallen over the past year to 10.9 percent, its lowest level since the end of 2006.

And the county’s Class A vacancy rate is down to 7.8 percent — the lowest rate in more than 20 years.

Cushman & Wakefield analysts project that rents for Class A office space could rise to the $33- to $35-per-square-foot range within the next eight to 12 months . . .

With all the good economic talk, we haven’t reached that point yet.  Nevertheless, we are getting there, and it is important because it:

. . . could strengthen the case for financing new construction.

“One of the interesting things about the Tampa Bay market is the vacancy rates are now at a level that indicates to developers that the market can sustain new speculative construction,” said Chris Owen, Cushman & Wakefield’s director of research for Florida.

That is timely for Water Street and some other projects (though we assume much of any new space will go to Westshore and its sprawling style).  The real question is what form most of the office buildings will take – urban or sprawling.

Built Environment – Outdated

A partial answer to that real question can be found in an interesting item on URBN Tampa Bay and we are just going to quote it all:

Corporate Center V is now proposed for the final outparcel at International Plaza, near the intersection of Boy Scout and Lois. The project includes an 8 story office building and a 5 story parking garage. Nothing to write home about as neither building includes any public facing ground floor commercial space.

But get this, the project features 254,258 square feet of office space and 1,046(!!!) parking spaces on 336,815 square feet of floor area. The parking garage is significantly larger than the office building itself!

Why? City code for this location requires 3.3 parking spaces per 1,000 square feet of office, or for at least 840 new parking spaces to be constructed.

Meanwhile, the massive surface parking lot for International Plaza adjacent to this site sits largely empty year round. And from our own observations over time, the parking garages for the existing CC3 and CC4 nearby are also rarely if ever full. And folks keep wondering why development is relatively expensive here, even though wages and taxes are relatively low? It starts in the codes.


From URBN Tampa Bay – click on picture for Facebook page

From URBN Tampa Bay – click on picture for Facebook page

We get that one of aspects of the Westshore area that has made it popular is free parking (though it gets paid for in other ways).  And we get that transit does not provide an alternative to driving right now.  However, almost everything about the parking situation in this project and its neighbors (google map here) is bad (not to mention Bay Street being on the wrong side of the mall, but that is another issue).  The line of garages between the office buildings on Boy Scout and the mall (or mall parking lot, really) is bad.  The wasted space of the mall surface lot is bad. The extra, unnecessary spaces are bad.  And that is not even getting to the City code.

(Note: the Corporate Center development concept is literally a late 1990’s development model.  The interiors may be nice, but the development model is not.)

Of course, the is parking issue unique to this project.  Midtown is full of massive garages.  Even Water Street has multiple large garages (though we are told they are going to be built to be more easily converted to other uses).  Is this what the City really wants?  The reality is that, in terms built environment, the future is now.  What is built now be with us for decades and will affect what is built afterward, including in transportation.  For all the good in plans for developments like Water Street, there is still more in the City that is poor.  Change the code.  

USF – Stadium Talk

As readers may know, a study has been done regarding a possible on-campus football stadium at USF. Some results were revealed this week. (You can see the study here).

After poring over a 171-page market and financial feasibility study regarding an on-campus football stadium, new USF vice president of athletics Michael Kelly has drawn at least one concrete conclusion.

The proposed USF Football Center — which would include an indoor practice facility — remains the top priority.

* * *

As for an on-campus stadium? Kelly gleaned some interesting findings from the study done by Conventions, Sports & Leisure (CSL), which gathered survey data from 8,637 respondents ranging from students to top donors.

It also assessed local market conditions, crunched key data, and did comparative studies of other new stadiums built in recent years on Division I-A campuses.  

What did it find?

Based on its research, it summarized the ideal USF on-campus stadium would seat 35,000, with 10,000 seats dedicated to Scholarship (donor) seating and 1,200 club seats, among other premium-seating options. With attendance generously projected at slightly more than 30,000 a game, the study projects USF could turn a profit.

In the past three years, USF as averaged roughly 20,000 paid attendees and 3,800 students per game, the study reveals.

“Overall, it is estimated that a new (on-campus stadium) could generate $15.8 million in net operating revenue and incur $4.2 million in operating expenses,” the study says, “resulting in a net income of roughly $11.7 million before debt service in first year.”

A stadium could generate income, but, with the actual attendance numbers over the years, we are dubious of the figures quoted above.  While one would hope that an on-campus stadium would build attendance, we think projections should be quite conservative.  If more people go to games than predicated and there is more revenue than planned for, great.  Moreover, the above quote speaks of income before debt service, but what will the debt service be?   Will it eat all the income and more?

Of course, an on-campus stadium is not just about income.  There is creating a better environment on campus, building more enthusiastic support for the institution, and helping to recruit better students.  Nevertheless, the stadium should hopefully pay for itself, at least – through donations or revenue.  That leads to cost:

But USF still faces an uphill financial climb if it wants a venue similar to Colorado State’s 41,000-seat Canvas Stadium, which cost upwards of $24o million and serves as the de facto template for USF’s facility.

The study estimated USF could generate roughly $30 million (in capital gift revenue from donor seating, and other fundraising), then fund roughly $100 million in debt. But that still leaves a funding gap of around $110 million.

In terms of athletic donor revenue, USF ranks second to last ($2.4 million annually) in the American Athletic Conference, the study indicates.

If USF wanted to go more modest, it could fully fund a 35,000-seat stadium comparable to FAU’s (estimated cost of $120 million), the study indicates. And it would face only a $20 million funding gap if it opted for something similar to Houston’s TDECU Stadium (estimated cost of $150 million).

For reference, this is the Colorado State stadium:

From Colorado State Athletics – click on picture for stadium information

For more information see here and here.

We do not think USF should settle, and neither do survey participants:

But the survey, which included one-on-one interviews with key USF donors and corporate sponsors, indicated the overwhelming response was no compromise in quality.

“Stakeholders were unanimous in their belief that the university should not build a new stadium if it cannot afford a modern, quality facility,” the study said. “They indicated that a lesser-expensive, value-engineered stadium such as Spectrum Stadium at UCF should not be considered.”

If there is not enough money to build out the full featured plan now, there could always be a phased plan.  But that is a matter for further discussion.

While we would really like to see an on-campus stadium at USF, especially if they get donors to pay for it, it has to make sense.  Right now, we do not have details of a specific plan and cannot judge.  But it is early in the process.  There is a lot more work to do before anything gets built.  We look forward to hearing more.

Schools – Taking the Lead

The Hillsborough County schools cannot seem to catch a break.  Since the crisis about the Superintendent a few years ago, there has been much news of inadequate budgets, teacher unhappiness, building problems, etc. This week, there was more with a little twist:

The Hillsborough County School District has found lead in the water at 21 schools over the last year, it announced Tuesday.

The district said it has replaced the plumbing components that could be responsible for the contamination.

Only 50 schools have been tested, and within them, more than 1,700 faucets, drinking fountains and fixtures, according to electronic communications that the district sent to parents and employees Tuesday.

“We will continue testing the drinking water sources in our schools for lead until we have checked all 270 facilities in our district,” said Tuesday’s mass email to parents and staff.

* * *

The highest results were in sinks at Smith Middle School and Mitchell Elementary, both of which measured at over 215 parts per billion. The next highest result was King Middle. The district said it replaced faucets and fixtures any time the level of lead in the water exceed 15 parts per billion.

We applaud them for being proactive now.  We are a bit unsure why no one was checking on this years ago.  It is obviously not a new condition.

Westshore-ish – More Midtown

There was Midtown news this week:

First up: Midtown West, a 176,000-square-foot project to be built on a speculative basis. Construction is expected to begin in early 2019 with completion targeted for late 2020.

The developers of Midtown released two more renderings this week.  Keeping in mind that renderings are notoriously inaccurate, here they are:

From the Business Journal – click on picture for article

From the Business Journal – click on picture for article

In the overall, monumental sense, the project looks good.  But there are still some issues. Not only does Whole Foods retain its surface parking along Dale Mabry (the silliness of which is make even clearer in the rendering because the actual parking spaces are not that close to the store entrance), there is also a driveway between the office building and Dale Mabry and the sidewalks into the project seem to kind of die as they (do not) connect to Dale Mabry.  (Moreover, whatever awnings there are internally are broken up and appear more ornamental than practical.)

We like the general concept of this project, but some of the details, which could be easily fixed, seem a little weak.  It has always been a bit too much of an island in the city. Then again, if the City doesn’t care, why should the developer?

Red Light Cameras

We have not discussed the red light camera debate much.  The cameras have been held legal in Florida.  But do they promote safety?  A recent study says not really:

Red-light cameras don’t reduce the number of traffic accidents or injuries at intersections where the devices are installed, according a new analysis by Case Western Reserve University.

Touted by supporters as a way increase public safety by ticketing drivers who continue through red lights, the cameras actually shift traffic patterns: More drivers tend to brake harder and more abruptly, increasing fender-benders and other so-called “non-angle” collisions.

“Once drivers knew about the cameras, they appeared to accept a higher accident risk from slamming on their brakes at yellow lights to avoid an expensive traffic citation—thereby decreasing safety for themselves and other drivers,” said Justin Gallagher, an assistant professor of economics at Weatherhead School of Management at Case Western Reserve.

Gallagher is co-author of a paper posted to Social Science Research Network, commonly known as SSRN, based on an analysis of thousands of collisions over a 12-year span reported by the Texas Department of Transportation. Researchers focused on data while red-light cameras were operating and again after they were removed (by voter referendum) in Houston—and drew on similar data from Dallas, which still has its red-light camera program.

In Houston, the installation of the cameras led to 18 percent more non-angle accidents, with an estimated 28 percent jump in these collisions in a combined Houston-Dallas data sample, researchers found.

While removing the cameras in Houston caused 26 percent more “angle” accidents—such as T-bone collisions, considered among the most dangerous—it’s likely the cameras actually led to more accidents overall, since there are more non-angle accidents, researchers concluded.

You can read more here, here,  and here (Their paper can be obtained here.) We are sure the debate will continue.

An Interesting Read on Urbanism

URBN Tampa Bay featured a Vox interview with a well-known urbanist. It is worth reading here to get nuggets like this:

The way you change the conversation about car dependency and sprawl is by not making it an ideological argument. One of the problems urbanists have had is to be ideological about the suburbs. The commentary is, “don’t these people know they live in a soul-sucking place?”

That doesn’t help. I can hear the voices of suburbanites saying, “What are you talking about? I know everybody on my street, my kids play in the cul-de-sac, I open up the garage door and my neighbor comes over and has a beer. I have more of a social environment than you do in your apartment floor.”

So you’re not going to win an ideological argument about who is smarter or who has the better life. People will choose different conditions.

We have to make it a conversation about cost and consequences. Sprawl is extremely subsidized, and the chickens are coming home to roost on that. Cities and regions are starting to see pseudo-bankrupt conditions. The tax generation doesn’t match the cost. Not even close.

I’m not going to tell you your choice is fundamentally wrong. I’m going to point out that your choice is being subsidized by me, who’s paying more taxes and using less infrastructure.

We agree with that, especially here where the County Commission (and the City to a large degree) makes everyone subsidize more and more sprawl.  It is not the market that dictates this model, it is the government that chooses it. (We think the developer and buyer decisions would be much more mixed – not uniformly urban or sprawling – if the true costs of development were paid).

While we don’t agree with everything he says in the interview, but it is an interesting read.

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