City, county clash again on CRA funds

Once again, Sarasota County and the city of Sarasota find themselves on opposite sides of an issue. This time, it’s about how to properly count to 30.

City officials, displeased with the county’s recent decision to let the jointly funded Downtown Community Redevelopment Area expire at the end of September, have been exploring other potential revenue sources to eliminate blight in the heart of the city and Newtown.

On Monday, the city discussed a potential accounting error that could help address its short-term troubles. The CRA, established in 1986, uses a portion of city and county property tax revenue from within the district’s boundaries as its funding. When it was originally approved, the CRA came with a 30-year lifespan.

As the city and county worked on an extension that never came to fruition last year, both sides acknowledged Sept. 30, 2016 as the date the CRA would sunset. Now, the city is changing its stance, arguing that the county is responsible for providing one more year of payments into the redevelopment trust fund.

“It was an innocent mistake, and we can see how it was made.” — Tom Barwin

What’s changed? City Manager Tom Barwin said Finance Director John Lege pointed out the first year of the CRA included no payments into the agency’s trust fund. That year was used to establish the baseline for tax-increment financing — only property tax above the 1986 levels would become CRA funding. As a result, there have been only 29 payments from the city and county over the 30-year life of the downtown CRA.

The city believes the terms of the CRA dictate 30 years of tax increment payments, rather than the agency expiring after 30 years of existence. The City Commission voted unanimously to send a letter to county administration making its position known, asking for the county to agree to provide CRA revenue in 2017, as well.

Despite the acrimony between the two governments over the CRA in the past, Barwin believes precedent is on the city’s side. As a result, he said, he didn't anticipate a great deal of controversy surrounding the request.

“It was an innocent mistake, and we can see how it was made,” Barwin said. “We hope this sunsets according to the agreement, to the 30-year schedule.”

Based on the initial reaction from the county, that optimism may be misplaced. Although county officials declined to comment on the city’s inquiry beyond a statement from Assistant County Administrator Mark Cunningham, the brief response makes one thing clear: The county is unwavering in its belief that the Downtown CRA is ending Sept. 30.

“This has been stated in several previous resolutions approved by both the county and the city of Sarasota.” — Mark Cunningham

“This has been stated in several previous resolutions approved by both the county and the city of Sarasota and in the CRA Extension Committee final report,” Cunningham said in the statement. “It’s also been mentioned repeatedly at public, televised budget workshops and at a joint meeting between the city and county. Further, the city’s adopted financial plan shows city and county contributions to the CRA in (fiscal year) 2016 but none in FY17.”

Barwin said the city is still waiting for a formal response from the county, but a stark division has already emerged.

“I think it would be premature to make that determination,” Barwin said of the county statement. “We haven’t even sent our correspondence or documentation.”