CLEARWATER — One year after the city’s boldest incentive program yet failed to secure a single business deal for downtown and caused confusion among applicants, the guidelines are being scrapped and rewritten to leave less room for misinterpretation.
But two ghosts from the original program are haunting the city’s attempt to start over.
Dan Shouvlin, owner of the Clear Sky on Cleveland restaurant, said he has not received a $100,000 grant promised to him by former Community Redevelopment Agency Director Seth Taylor, who resigned in October. Pour Yours wine bar owner Lina Teixeira is appealing her application’s denial this year under Taylor’s replacement, Amanda Thompson, stating her first-of-its-kind business meets all of the original program’s requirements.
The lingering issues are complicating the city’s efforts to resolve what prompted a need for the incentive program in the first place: a perception that downtown Clearwater is an unfriendly place for business.
"I think the reputation of the city and the reputation of the CRA are at stake here, and the public perception of both that we keep our word even though the word may have gone in error," said City Council member Bob Cundiff.
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The City Council, acting as the CRA board, approved Taylor’s anchor incentive program in June 2017, which offered up to $250,000 for renovations, rent, equipment and other start-up costs for businesses that located downtown. The grant would not have to be repaid if the business stayed open for five years.
The program guidelines were vague, targeting primarily restaurants and breweries but also open to other businesses that were "first-to-market and anticipated to have a catalytic impact" on downtown.
When the council approved the program, Taylor stated Clear Sky on Cleveland would be the first beneficiary of the anchor tenant incentive even though renovations of the building at 418 Cleveland St. were nearly completed before the incentive program was even approved.
On Monday, City Attorney Pam Akin said Clear Sky never formally applied for the incentive program. But she said there was "no question" Taylor verbally promised Shouvlin the funding although he was "not authorized to make those representations." When reached for an interview on Monday, Taylor said in a statement he had earmarked funding to assist Clear Sky with build-out costs through "a development agreement" that was never finalized, not the incentive program.
Akin said she did not recall a development agreement being discussed.
Shouvlin declined to comment on his discussions with the city but confirmed he was promised $100,000.
"Somebody representing the city promised them some money along the way," City Council member David Allbritton said. "We want happy people downtown that can sell the fact that ‘come to downtown Clearwater. If we don’t have those people there doing that, why do we even have an incentive program? Because they’re going to go right to Dan Shouvlin and say ‘how did it work out for you?’"
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Thompson, who was hired Jan. 31 to replace Taylor, said her goals are to make the parameters more clear for applicants and the investment of public dollars more worthwhile for the city.
She is proposing incentive funding only be used for structural improvements to buildings, or rent subsidies, so the investment stays with the city if the business leaves. Businesses would apply jointly with a proposed landlord, and the city would share one-third of the costs of improvements up to a total of $250,000 per space.
The money would come from the CRA’s now $1 million opportunity fund, which granted $600,000 to investor Daniels Ikajevs in October for the build-out of a collaborative workspace in his Bank of America office tower.
While the original program focused on recruiting anchor businesses, Thompson clarified eligible businesses should be "food and drink businesses that are open on nights and weekends" to build a more solid base.
"A destination restaurant, that’s like scouting for Olympic talent," Thompson said. "A lot of times destination restaurants don’t start out that way. It is in hindsight they become that. A lot of cities are more successful in nurturing their environment so they might become that restaurant destination."
The original program had no time parameters, and Thompson is proposing the revised incentive be open for applications in a set cycle beginning in August this year with awards decided on in October. The cycle would include workshops for prospective applicants and property inspections to identify necessary code updates.
City Council members, acting as the CRA board, are scheduled to vote in August on Thompson’s overhaul.
But they also will have to decide how to resolve the lingering questions about Clear Sky and Pour Yours.
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At a meeting this week, all council members except Mayor George Cretekos supported allowing Clear Sky to retroactively apply for the original incentive program funding before new guidelines are adopted.
The four council members also supported allowing Teixeira to re-apply for funding under the new guidelines in August. Teixeira said that would not fly because the new guidelines would not reimburse her for much of her $90,000 investment, including equipment and self-pour wine dispensers.
Teixeira applied for the funding in January and officially opened her wine bar in May. She said she was never promised funding by Taylor or Thompson but that her business being first-of-its-kind downtown, focused on food and drink, and a destination, surpasses the original program’s parameters.
"If I knew I wasn’t going to get (the funding), I would not have opened it," said Teixeira, president of the Downtown Merchants Association. "I opened it for two reasons: to be more credible when I try to get other people downtown and to lead through example. I’m doing it, you can do it too."
Council members stressed Teixeira’s dedication to the downtown business community, her advocacy for merchants and involvement in city’s issues. But Akin warned funding decisions should not be "based on who is applying but on the business."
With bills proposed in the Legislature this year that would have restricted CRA districts, and in one case phase them out, Cretekos warned there was more at stake.
He said CRA critics will be watching how the city allocates its CRA funding. Making exceptions for certain businesses could set them up for backlash.
"If our staff is telling us that this applicant did not meet the guidelines that we ourselves had established, then we may be looking at somebody investigating our decision as to why we’re doing what we’re doing in this case," Cretekos said. "I think it would cause the state to come and look at our actions."
Contact Tracey McManus at [email protected] or (727) 445-4151. Follow @TroMcManus.