FBI Investigation Into Tallahassee's CRA Reanimates Old Concerns

Jul 7, 2017

The FBI is investigating Tallahassee’s Community Redevelopment Agency, while questions of cronyism swirl around city hall. The state’s CRAs missed the chopping block this legislative session, despite previous reports of mismanagement. WFSU looks into how the agencies’ loose structure is fueling their current predicament.

Credit Regan McCarthy WFSU News

Community Redevelopment Agencies work with local governments to improve blighted neighborhoods. Their goal is to fund better roads, sidewalks, affordable housing units, to improve underserved areas. Some projects are wildly popular, like Cascades Park in downtown Tallahassee. What was once an abandoned brownfield is now a community hub with trails, rolling hills, and an open air amphitheater. It’s a favorite spot for families and lunchtime walkers. Business analyst Anna Carradine works remotely, and often brings her laptop here.

“Right now I’m in the writing stage, so sometimes I just like to sit down and work for an hour. And then I’ll put my laptop in the car and walk around a few times,” Carradine said.

But just down the hill from Cascades Park sit long-empty warehouses and storefronts. Critics say CRAs aren’t focusing on their original mission: to improve blight, slums, and affordable housing. According to a Miami-Dade County grand jury report, stadiums, dog parks and festivals get funding instead of apartment blocks with faulty wiring and overflowing toilets.

Boca Raton Democratic Representative Joe Abruzzo says even when CRAs successfully attract new businesses, the investment may not extend to those who need it most.

 

“I remember one got to the point where they were doing $75,000 puppet shows, instead of redeveloping the African-American community,” Abruzzo said. “They redevelop the area and that area within the city becomes extremely valuable. It becomes one of the hottest markets in town if you will. But then the rest of the community, the other 80% is still left in blight.”

Ted Sauerbeck worked on the Auditor General’s report on the state’s CRAs. He says the letter of the law governing the agencies is open-ended. That’s allowing carnivals to win out over affordable housing, and private businesses over public residences.

“By introducing the words 'including but not limited to', it has, as we noted in our audits, opened up the door to other types of expenditures that the CRA board perceives as being related to their responsibility. But it’s not necessarily outlined in the statute,” Sauerbeck said.

According to the Legislature’s policy analysis, 42% of CRA investment goes to rehabbing commercial businesses, instead of private residences. That may be because of the way the agencies are financed: it’s called tax increment funding or TIF. Michael Parker with the Florida Redevelopment Association explains.

“Basically the base value is established when a CRA is created, and the increase in taxable value that is generated because of the improvements and increases in value is then reinvested back into that CRA area,” Parker said.

Basically, local governments are incentivized to get the largest return on investment, which may not come from affordable housing. Still, proponents argue CRAs are developing areas the private sector won’t, says Thomas Hawkins with the growth management group 1000 Friends of Florida.

“We don’t have a free market for most infrastructure. There’s not a free market for putting in new water pipes or sewer pipes or roads," Hawkins said. "These are public infrastructure. And we’ve got to have public agencies that make these investments. So CRAs fill that gap.”

But despite the successes, CRAs don’t have the same oversight as local governments. And there’s no state standards for how to award the projects. Which has critics worried that cronyism and self-dealing will run rampant. Those are the same questions swirling around an ongoing FBI investigation into Tallahassee’s Community Redevelopment Agency.