The year Jacksonville’s lords of the waterfront fell from grace

COMMENTARY | This was the year Jacksonville’s masters of the universe face planted.

The pandemic economy may bear some blame. It has upended the present and clouds the future, but it doesn’t account for the past: The seeds of Jacksonville’s star-crossed 2020 were planted years ago, even before Jaguars owner Shad Khan and former Disney executive Peter Rummell sold the city on their technicolor dreamscapes of a transformed waterfront on opposite sides of the St. Johns River.

In betting on those projects, the city was truly betting on the powerful men behind them. But both those projects and the men connected to them exit 2020 humbled, altered, and the city once again finds itself losing one of its most precious resources: Time. 

There have been two major stretches of economic expansion since 2000  —  two decades during which historic but hollowed-out downtowns across the nation have experienced a renaissance, even with a major recession sandwiched between them. Jacksonville, alone among Florida’s major cities, has missed out on both. 

Former Jacksonville Mayor Ed Austin posed for a photograph once in front of downtown’s skyline  —  a 1995 picture memorializing the sunset on his public service career. It should have captured the downtown of a different era, but, disturbingly, it didn’t: The downtown skyline circa 1995 looks exactly as it does today.

How did this happen?

Mayor Ed Austin, in the twilight of his career as a public servant of Jacksonville, in June 1995.

Jacksonville has teed itself up for failure time and again by chasing the One Big Thing with a gambler’s relish. The Grand Slam. The Game Changer. And like the gambler, the city finds itself empty pocketed and out of time, those hopes having vanished like a thief in the night. Jacksonville is trying to build world wonders atop stilts, planning massive projects without doing the less exciting but necessary work of laying down a foundation to prop them up.

There was the 2005 Super Bowl: To its great credit, the city nabbed one of the nation’s signature events. To its great detriment, it simply wasn’t ready to host it. Not enough hotel rooms or taxis, and woefully inadequate mass transit. Even the weather turned sour — the gods themselves seemed determined to sabotage the city. The mishaps jaundiced Jacksonville’s reputation for a generation of national sportswriters, but in the end it didn’t matter much. The event came and went, and who can even tell anymore?

The Republican National Convention was Jacksonville’s latest magic bullet, the next in the line of Big Events that would Put Jacksonville On The Map  —  until it never came, leaving the city leaders who courted it humiliated and the local government out hundreds of thousands of dollars in planning costs.

But two-waying downtown streets? This is the kind of modest, relatively cheap change everyone wants  —  that everyone agrees should be done  —  yet, unbelievably, it’s just not done year after crushing year. It would help a broad swath of downtown businesses and improve the experience of current residents. But it also won’t directly inure a small fortune to a politically connected developer or consultant, so it has moved at a glacial pace. This is why people become cynical about government. 

That is the kind of project that would be  —  to extend the tortured sports analogy —  a base hit. It’s not a grand slam, not transformative. It’s incremental progress, part of the foundation. (And are Liberty Street repairs still not finished?)

Tampa City Hall earlier this year celebrated landing a $24 million federal transportation grant that will extend its sterling downtown riverwalk and connect it to adjacent neighborhoods, the latest success in a years-long downtown revival that ought to be the envy of Jacksonville civic boosters. 

So what did Jacksonville do with its grant, awarded last year under the same federal program? It has torn down a perfectly functional roadway near TIAA Bank Field because city leaders think Khan wanted it done for his future development plans in the area  —  plans for a luxury hotel that Khan and the city have taken so long to move to square one that the development rights expired earlier this year and must be re-bid all over again. The whole plan is in purgatory, but that damn ramp came down  —  to the benefit of no one for the foreseeable future.

Tampa is building something up. Jacksonville tore something down. This is too often our way.

And here we are, in 2020.

There was a time when it seemed like Khan and Rummell  — both prolific political donors and high-visibility downtown boosters  —  were in some sort of rivalry to show Jacksonville who was the biggest dreamer and its smartest man. They had competing visions for tracts of public land on the north and south banks of the St. Johns River in downtown, rolled out around the same time in the first half of the past decade. The particulars of their plans differed some, but in essence they both hoped to build massive mixed-use developments with major help from taxpayers. 

Both projects have taken far longer to gain any momentum than anyone had originally anticipated, and what momentum they now have is clouded by an ominous question: Will post-pandemic downtown development in America look as it did during its renaissance the past twenty-plus years? Neither Rummell nor Khan turned dirt during one of the most prosperous economic expansions in American history, and only now  —  in the pandemic economy  —  is the city doubling down on these projects with its money and its hopes.

The Southbank goliath goes south

Rummell’s efforts to build a mega-development on a vacant 32-acre waterfront tract on Southbank began in 2014: “The District” was to be 950 residences along with a hotel, several hundred thousand square feet of office and retail space, and a marina, all imbued with a healthy-lifestyle vibe that Rummell promised was something Jacksonville had never seen before. “Without wanting to sound arrogant, this is one of the biggest, boldest ideas to hit Jacksonville in at least the 20+ years I have been here,” he told several friends a few years ago. 

Peter Rummell, circa 2005.

The project was supposed to move fast. “Nobody can expedite this process faster than we can,” a former Rummell partner, who since left the group, told JEA officials during 2014 talks over the purchasing rights for the waterfront land.

After several years of fits and starts  —  and no construction  —  Rummell gave up control of the project this year to his financier, Preston Hollow Capital. For the project itself, in the hands of a financial institution, this is its greatest chance of ever actually getting built, so there is some good news there. But this has come at the expense of that one, irretrievable asset: Time. 

Three presidents will have sat in the White House before the first shovel turns dirt on Rummell’s project.

And will Preston Hollow  —  which describes itself as a “non-bank finance company specializing in municipal specialty finance” —  dedicate itself to the vision and the top-notch quality promised by the personality who was once behind it? Will it see this project through? Who knows?

It was striking to see a press release this past week from City Hall announcing that Preston Hollow had (finally) closed on a $35.6 million bond sale necessary to finance “horizontal” construction  —  utilities, sidewalks, access roads. 

Rummell wasn’t mentioned once.

The tiny billionaire

Khan’s own arc has been more dramatic. 

He’s been fooling around with development plans on the east side of downtown for so long  —  since about 2015  —  and with so many different renderings it’s a genuine task to figure out what he ultimately envisions. What he appears to have settled on, for now, are two developments: A mini-version of Rummell’s “District” project on a parking lot adjacent to TIAA Bank Field, and later a luxury development with a Four Seasons on waterfront land across the street, a large portion of which is restricted by a National Park Service agreement requiring it to be public park land forever (for the moment this second project remains entirely speculative because there’s no indication the Park Service will agree to free the city of this obligation, even as the city tore down the Hart Bridge ramp with federal money to benefit Khan’s future plans).

For the mini-project on Lot J, Khan has asked, and will likely get, a large fortune from taxpayers: About $240 million, which with borrowing costs factored in is truly about $390 million, according to City Council Auditors. 

It’s not just the size of the subsidy that has generated controversy. It crossed an invisible line: In years past, financing for Jaguars-related projects came from a specialized revenue source generated by hotel fees  —  money with restricted uses. To fund Lot J, however, the city is diving into its general fund, which means Khan’s project is now in direct competition with every other city priority. 

The stakes are enormous: The Lot J subsidy is enough to fund nearly an entire year of Jacksonville Sheriff’s Office operations (the city is on track to record its highest number of homicides in 30 years). It’s also far more than what the city spends each year on infrastructure throughout the entire city. 

It’s an outrageous sum, the result of a crummy deal negotiated directly by Mayor Lenny Curry’s administration, the recipient of tens of thousands in political contributions and other perks from Khan and his organizations. It’s such a bad deal, in fact, that Khan has for the first time since he purchased the team in 2011 faced significant pushback from the City Council. 

Khan could have easily relented on some of the terms of the deal. He could have made a concession — signing a small extension to the stadium lease to keep the Jaguars here a bit longer, or providing a minimum number of home games he’ll keep local (as opposed to taking to London) each season. His lieutenants balked at those ideas and pressed forward. They issued threats about the team’s future in Jacksonville, and they continue to mislead on key aspects of the subsidy package.

Khan himself has chosen to be completely absent as the debate around Lot J subsidies unfolded and then tanked, and his son, Tony, a Jaguars co-owner, seems totally preoccupied cutting cartoonish promos for a wrestling company he started. The city, it seems, simply doesn’t rate with the family much anymore.

Jacksonville Jaguars Owner, Shad Khan.

It’s the smallness of it all that is so distasteful. The small size of the development (it has gotten smaller over time  —  residential and office towers have been eliminated or replaced by low-rises). The small deceptions. His emissary’s temper tantrum over the team’s future in Jacksonville. The small, petty way in which Khan, a Forbes-list billionaire, has nickeled and dimed the city for all its worth. It’s all so small and so very discouraging about someone who was once viewed as a worldly, capable and willing champion for Jacksonville. 

Khan became the NFL’s first non-white owner when he purchased the team, and he has become a celebrated and credible voice on racism and discrimination issues that have bubbled over in recent years among players. It’s clearly something important to him. Khan became a majority investor in the Black News Channel in 2019. “This is a chance for me to make an impact on how African-Americans report and consume news and related programming, how their voices are amplified and heard and how all of us can better connect socially, culturally, economically and more,” he said at the time.

His greed has tarnished this reputation, and it has set his personal interests against those he claims to care about.

The Jacksonville-branch NAACP wrote to NFL commissioner Roger Goodell this past week asking the organization to withdraw any support it has for the Lot J project. In its letter, the NAACP called the project, and the city’s financial commitment to it, the “latest chapter in a book of broken promises.” The group is referencing the often-discussed promises made to majority-Black neighborhoods a half-century ago when voters approved consolidating the city and county lines into one government. No one was to be left behind  — everyone would get city water and sewer lines, sidewalks, paved roads  — a promise that secured votes from otherwise skeptical residents, and a promise city leaders promptly broke over and over again. 

More:Nate Monroe: The broken promise that broke Jacksonville

More:Nate Monroe: “Consumed by the fire”

“Under the present Lot J proposal all the Northside gets are more promises that will likely be broken,” Ben Frazier, president of the Northside Coalition of Jacksonville, another local civil rights group, said this past week.

Remember the invisible line: Money for Lot J comes at the expense of all other priorities, including the possibility of finally fixing this broken promise. And that, more than any kitschy development, no matter what branding is slapped on it, would build a better city, and a better city for everyone. That is the foundation upon which Lot Js and Districts can be built and ultimately be successful. 

As ever, the controversy of the day comes full circle in Jacksonville: The problem is one of the priorities: Where does the money go? 

This was the year the lords of the waterfront were humbled, but their failure is our failure, too, because no development will change what’s in this city’s beating heart. That task belongs to us all.

Nate Monroe’s City column appears every Thursday and Sunday.

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