PANAMA CITY — Both potential developers of the city marina have met the deadline for signing an agreement and paying the city a $100,000 deposit.
HomeFed returned its agreement Thursday, and Mayor Greg Brudnicki has signed it. The agreement from Great South was returned late Friday and awaits the mayor’s signature. The agreement — called a memorandum of understanding — is a nonbinding agreement that outlines the city’s expectation of both developers.
The developers now will have until June 1 to submit final proposals.
In the three months before then, the City Commission will consider a checklist that was sent to both developers. It includes specific items such as deciding:
- a formula for rent.
- right of the city to approve construction and design of buildings.
- merchant tax and ad valorem tax reinvestment the city would be willing to pursue.
- what city assistance would be necessary but not covered in the master lease or purchase contracts.
- the method for determining price/payment by city upon completion of a new City Hall.
“This is a summary of the issues that can be worked on now with (and without) the developers to assist the city and the developers in having more refined and specific proposals on June 1, 2015,” states the agreement. “There is more leverage at this time to push the developers on these issues so that the proposals on June 1 will be primarily financial proformas rather than primarily design, concept and elevations.”
City Attorney Nevin Zimmerman said the checklist is as much about persuading the commission to make decisions about its desires for a lease as much as to engage developers in discussion.
“I don’t think they should feel pressured because all of the things that need to be decided sooner or later,” Zimmerman said of the developers, but added, “The city is driving the deal.”
As an example of its role as driver, the city is insisting on the development being a lease so it can maintain some control over one of its most valuable pieces of property. The lease would include a clause that would require the winning developer to start construction by a certain deadline, Zimmerman said.
“The city does not want a vacant building,” Zimmerman said of one of the reasons to desire more control.
There are different options to consider for added control. One is a clause for a buyout if the city does not like the direction of the property or if the developer defaults. The city would then act as landlord for the businesses that move in as tenants.
The commission has yet to discuss options for financial assistance, even though there was a section in the agreement that said the city would only consider options on new revenue from the project. One of those options is tax increment financing where any increases in property tax values goes back to the developer. The city could give a cut of property taxes in general. Another is giving the developer a portion of collected merchant taxes from future tenants.
The city also will need to address what to do about utilities, which will have to be expanded for the marina. The agreement includes a suggestion that the developer pick up the cost of added infrastructure inside the marina area.
William Harrison, a representative for HomeFed, has asked that the city announce it will move City Hall and start planning accordingly.
A developer will be selected 45 days after the master plans are submitted June 1. The losing party will get its $100,000 deposit back.
A discussion of the marina is on the commission agenda for its meeting 8 a.m. Tuesday at City Hall.