Over the past two months, Steve Schmidt has been buried up to his nose in sales figures and property appraiser records as he attempts to get a firm grasp on the current state of the city's two redevelopment agencies.
"We've been looking at ways to try and turn around the CRAs," the city's public services director told The Log.
On an annual basis, the city must prepare a full report, detailing the financial states of both the Harbor and Town Center Community Redevelopment Agencies. This year, the city took it one step further as Schmidt also prepared a "comprehensive review" of qualified residential, commercial and condominium real estate sales in the CRAs.
A qualified sale is a transaction that takes place between a buyer and seller, with no other influences on the sale. For example, a foreclosure or short sales is not a qualified sale since the transaction takes place between multiple parties.
As part of the process, Schmidt compared the number of qualified sales in the redevelopment areas for the years 2010, 2011 and 2012 to the just value, which is the price at which a property, if offered for sale in the open market would sell for.
In the Harbor CRA, which is centered along the Destin harbor, there were a total of 10 commercial sales, and Schmidt reported that the sales prices were 66 percent higher than the 2012 just value shown on the property tax appraiser's records. There were 10 residential sales with an average increase in value of 43 percent. There were 27 condominium sales with an increase in value of 34 percent.
In the Town Center CRA, which is centered around the Main Street area, there were three commercial sales with an average increase in value of 32 percent. There were 30 residential sales for an average increase of 28 percent, and 12 condominium sales with an average increase of 29 percent in value compared to the existing just value.
Given the increase in sales prices in both the Harbor and Town Center CRAs, Schmidt said it's a positive sign that the local economy is showing signs of improvement.
"We would like to think that the money we have spent in the CRAs is starting to help increase the property values," he said. Over the past few years, the city has revamped Mountain Drive and constructed the harbor boardwalk in the Harbor CRA, while making roadway improvements along Main Street and Airport Road in the Town Center CRA.
Although an increase in the sales price was noticed, Schmidt told The Log the city is still facing some challenges in the CRAs, due to a lack of revenue generation and debt payments they are under.
In the Town Center alone, the city is in debt roughly $900,000. As part of its repayment, the city uses tax increment funding to pay down part of its debt, but Schmidt said it's not enough to cover the payments and the city must use money from its general fund to subsidize the Town Center CRA.
"We're operating on a shoestring budget, and we are carrying the town center," he said. "The Harbor CRA is still in the black."
As the city looks for ways to revitalize the Town Center, Schmidt said the city can only do so many things, since they are basically limited to making infrastructure and quality of life improvements that would "draw" more people and businesses to the Town Center.
Despite the challenges, there are still opportunities in the town center. Schmidt told The Log there are some vacant properties available that would be ideal for condominiums or some type of redevelopment.
"As the economy comes back, these types of things seem to happen naturally," he said.
The city's CRAs were formed as a way to help revitalize the harbor and Main Street areas. In the state of Florida, local governments can designate an area as a CRA if it is considered blighted and meets certain conditions, such as having substandard or inadequate structures, a shortage of affordable housing, inadequate infrastructure, insufficient roadways or inadequate parking.
According to the Florida Redevelopment Association, there are currently 178 redevelopment areas in the state of Florida. The CRA term is limited to 30 years, unless it's extended.
Once the CRA expires or "sunsets," all revenues are retained by each taxing entity that contributed to the CRA trust fund.
Destin's CRAs were formed in 2003 and will expire in 2033, Schmidt said.