At its final scheduled working meeting, Richmond's Navy Hill Development Advisory Commission weighed the financial impact that the proposed publicly-funded arena could have on city schools. (Photo by Rodrigo Arriaza)
With seven meetings in the books, the Navy Hill Development Advisory Commission now looks ahead to a slate of public hearings this week, where it will gather input on the $1.5 billion Navy Hill proposal to include in its report to City Council.
The nine-member panel, which began meeting in October, was tasked with vetting the arena and downtown development proposal and presenting council members with a recommended course of action on the plan. At their last scheduled working meeting on Saturday morning, however, commission members still seemed a long way from reaching a consensus, and with a Dec. 23 deadline to complete its report fast approaching, they don't have time on their side.
"We’re using a dominant either/or logic, and that is so baked in that we can’t even explore the depth and complexity of the project being presented," commission member and University of Richmond visiting professor Corey D.B. Walker said of the Navy Hill proposal during a back-and-forth discussion with Lincoln Saunders, Mayor Levar Stoney's chief of staff.
The meeting focused on how Navy Hill would affect funding to Richmond Public Schools. While most of the development project would be paid for with about $900 million in private funds, publicly-funded bonds would be used to finance a planned 17,500-seat arena's construction. The so-called non-recourse revenue bonds would be repaid with new real estate tax revenues collected from a special 80-block tax increment financing (TIF) district.
Commission Vice-Chairman John Gerner has argued that if the Navy Hill plan is approved, new real estate revenues collected in the 80-block district would be diverted from the Richmond’s general fund, which covers city services such as the school system.
Richmond School Board 3rd District member Kenya Gibson, who spoke to the panel on Saturday, said she’s skeptical of financial projections for the project, and urged commission members to study cases in California, Georgia and Maryland, where tax increment financing deals have fallen apart.
“In terms of what I believe personally ... these development deals frequently don’t deliver," she told the commission. "We have historical precedent throughout the country and here in the city, and as such, I believe that this is not the right decision to make as a city because I see that the risk outweighs the potential benefits."
Richmond Director of Finance John Wack told commission members that Navy Hill would be a boon for school funding, however. After the arena bond debt is paid, Davenport & Co., the city’s financial advisor, projects that Navy Hill will generate more than $1 billion in net general fund revenue over 30 years, resulting in an estimated $500 million in funding for schools. Without Navy Hill, Wack said, RPS is expected to receive $200 million from increased real estate tax revenues in the 80-block district during that time. (The city's current fiscal year budget includes $320.7 million for the school system.)
"If I were an advocate for funding for Richmond Public Schools, which I am, I would much rather have $500 million than $200 million in funds," Wack said.
Last month, the School Board adopted a resolution, introduced by Gibson, to ask to be allowed to opt out of contributing its share of revenue to TIF district funds and other tax deals that finance city development projects. She said the resolution, which was approved by the board in a 7-2 vote, asks for the ability to opt out of any TIF proposal that the School Board determines could negatively impact school funding.
"We have a Redskins training camp, we have a Stone Brewery, we have a failed 6th Street Marketplace, and yet we still don’t have a full-time nurse in all of our schools, we don’t have enough bus drivers to get all of our kids to school on time and many of our bathrooms and classrooms remain decrepit," Gibson said.
Once it delivers its report to City Council, the Navy Hill Development Advisory Commission will present its recommendations at a Jan. 6 council meeting. The report will be key in City Council’s decision-making process, but it won't be the council's only guide.
Last week, the council opted to move forward with hiring Chicago-based firm C.H. Johnson Consulting to conduct its own review of the Navy Hill plan — though just like other steps in this process, that decision wasn't free of controversy. Council members weighed claims of a conflict of interest after a Richmond Free Press report stated that Rob Hunden served as vice president of C.H. Johnson from 2000 to 2005. Hunden’s firm, Hunden Strategic Partners, was hired by the city to produce revenue projections for Navy Hill.
The Navy Hill Development Advisory Commission’s public hearings will be held across the city from Monday to Thursday. All hearings will begin at 6 p.m.
- Monday, Dec. 16: Martin Luther King, Jr. Middle School (1000 Mosby St.)
- Tuesday, Dec. 17: George W. Carver Elementary School (1110 W. Leigh St.)
- Wednesday, Dec. 18: Hickory Hill Community Center (3000 East Belt Blvd.)
- Thursday, Dec. 19: Richmond Government Southside Community Services Center (4100 Hull Street Rd.)