The Escambia County Tourist Development Council (TDC) held a “historic” meeting Monday night and recommended the county issue up to $90 million in bonds for multiple projects.
While most of the bond funds will go toward renovations to Gonzales’ indoor sports facilities and the Pensacola Bay Center, the board also approved other tax revenues to be spent on the acquisition of the luxury cruise ship SS United States and $350,000 for the pop culture convention PensaCon.
The Escambia County Board of Commissioners will make the final decision on the commission’s funding recommendations.
“This was a historic meeting,” TDC Chairman David Baer said at the end of the two-hour meeting. “$91.35 million. That’s incredible.”
The largest requests – $60 million to build a new indoor sports facility at Ashton Brosnaham Park in Gonzales and $30 million to renovate the Pensacola Bay Center – passed 4-2 with six of the nine commissioners present. Voting against were developer and attorney Jim Reeves and hotelier Mitesh Patel. Commission Chairman David Baer, Escambia Commissioner Jeff Bergosh, businessman Shirley Cronley and Escambia Sheriff’s Office Commissioner Ronald Rivera all supported it.
The bond will require annual payments of up to $6 million for 30 years.
Prior to the vote, Patel made a motion to not approve these requests until more stakeholders were at the table, specifically the Sports Centre on 10 Mile Road, but no one seconded it and the motion died. Bergosh made a motion to send both projects to the BCC for approval, and the motion was seconded by Cronley and ultimately approved by the council after a lengthy discussion.
What does the Ashton Brosnaham Feasibility Study say?
Escambia County has hired Convergence Design in partnership with Crossroads Consulting Services, LLC (“Crossroads”), OWN and Nova Engineering to study the feasibility of developing an indoor sports facility in late 2023 at the Ashton Brosnaham Sports Complex located near 10 Mile Road in Escambia County.
Estimates for construction and site improvements range from $38.2 million to $48.9 million. Combined with soft costs such as design fees, inspections, testing, furniture and equipment, the total project cost is expected to be $47.9 million to $61.2 million in 2024 dollars, with design and construction expected to take two and a half to three and a half years, according to the study.
The facility would feature eight wooden basketball courts that could easily be converted into 16 volleyball courts, as well as a variety of auxiliary facilities such as meeting rooms, seating, food service, restrooms, etc. The study noted that not only would the greater number of courts be considered a competitive advantage over the Foley Events Center, but the location’s proximity to Pensacola Beach and other area attractions would also be considered a competitive advantage.
According to the study, Ashton Brosnaham’s new indoor facility is expected to operate at a small deficit initially, followed by a series of stable operating years (typically the third year for such facilities). Although it is estimated to operate at a deficit, the study states the project would generate “significant economic benefits on an annual basis,” generating approximately $37.2 million in benefits by the fifth year of operation, including approximately $1 million in county tax revenues and $1.7 million in state tax revenues.
$90 million for two projects: Escambia County wants to spend $90 million to build an indoor sports hall and renovate the Bay Center.
“These figures in stable operating years are likely to continue to accumulate as long as the facility is maintained and operated in a professional and competitive manner,” the report said.
The study estimates the proposed facility would generate more than 48,000 room nights in a “stable operating year,” but would be available for local teams and leagues to practice and play games most of the week, typically Sunday night through Thursday. Local events could also use the 73,000 square feet of column-free space for trade shows, banquets, expos, graduations and other similar large flat-floor events, the study said.
“Escambia County Schools, in partnership with the Parks and Recreation Department, will also be able to utilize this facility,” the study states. “The availability of both new hardwood court space and a new large flat-surface event space will provide significant benefits to Escambia County and area residents aside from the economic activity generated by youth sports tournaments and similar weekend events.”
Why some people wait before funding big-ticket projects
Darien Schafer, CEO and president of the Pensacola Tourism Bureau, told the commission that the Pensacola Tourism Bureau would use the “five cents” – the hotel tax the county is proposing to use for the sports complex and Bay Center improvement projects – to develop tourism destinations and build new facilities or renovate existing facilities that could bring a significant visitor impact to Escambia County. Schafer is concerned that the county will spend too much tax money over a long period of time, leaving a much-needed conference center in Pensacola unfinished.
“It would essentially use up 5 cents of the bond money, and neither of the two proposed facilities would be able to meet the need for meeting and conference space,” Schafer said, “and given the fact that the bond is out for the next 30 years, unfortunately, we would not be able to build that facility using TDC funds for the next 30 years, which would be a disadvantage to the county.”
Innisfree Hotels President and CEO Ted Ent also spoke to the board about the funding plan, saying the tourist development tax bond restrictions would be a costly burden the county would shoulder for a generation, and he is concerned that stakeholders, various people, organizations and neighbors who would use or be affected by the project, have not had enough time to study or discuss the project, particularly the county-funded study to build an indoor sports facility on Ashton Brosnaham Road in Gonzales.
Several others expressed similar concerns about the large scale of the request, which appeared to be made on short notice, and Ent wanted more time and wider stakeholder input before the vote to “avoid tying ourselves up for things we can’t address at a later date.”
“Most of these stakeholders were not consulted until this study was released two days before the last TDC meeting,” Ent said. “In fact, as far as I know, current hoteliers, local DMOs (destination marketing organizations) or others who generate TDC funds were not consulted in any way about the current site proposal. However, no hotelier I have spoken to, including myself as a hotel industry representative, supports the current site (sports venue). The study shows that spending $4 million in tax dollars annually to repay the bonds will generate only $1.1 million in local tax revenue after the project stabilizes years. To me, this is not a good investment.”
Most board members, and several members of the public who spoke to the board, agreed that improvements to the sports facilities and the Bay Center were needed, but some said building a sports facility large enough to compete with the Foley Events Center off 10 Mile Road was not a good plan. Several, including Baer, said they would like to see the Bay Center renovated and expanded to meet the growing needs of the area, including sports, events and entertainment.
“I think it’s a better location. Unfortunately, nobody has brought it up to us today,” Baer said. “We’ve been talking about the Bay Center ever since it was built, I don’t know when, ’83 or ’84, and I think a lot of people have had the opportunity to come to our meetings and voice their opinions. Where are the people who were concerned about this issue before? Are we going to keep putting it off?”
Waiting is exactly what TDC members Teniade Broughton and Mitesh Patel wanted. Broughton, who is also a Pensacola City Council member, had to leave early to attend a City Council meeting. She asked the board to consider waiting to vote on the request because not everyone has had a chance to comment yet.
Ms Patel also reiterated her call to wait until more people have had time to consider feasibility studies on sports facilities that have only recently been provided before voting.
“You said a lot of people have been at the table since this issue was raised, but I would say that even our board wasn’t shown the full findings until we asked for them,” Patel said. “I don’t think that’s right. I don’t think it’s right to hide things and not be completely transparent and say, ‘Vote for $90 million, but we don’t need to have all the information yet. Just vote in favor and we’ll show you.'”
“We may be able to leave a legacy, but that legacy will be one of people not being happy with the decisions that were made for the next 30 years. I really hope this board takes into consideration that this is a 30-year bond. This is a big deal. We don’t need to rush it.”
Jim Reeves also urged the board to wait, citing the location of the sports complex and funding considerations: The Bay Center is estimated to need more than $40 million in renovations and repairs, but the county has borrowed $30 million for them.
“I would choose to borrow $40 million, have the right amount in place and address that,” Reeves said. “Secondly, there’s the political situation regarding the location of this other facility. In my opinion, we should wait. By waiting, two things will happen: A, all the key players will be on board, and B, interest rates will theoretically go down. That shoe hasn’t dropped yet, and in my opinion, bonds will go down significantly.”
Bergosh and other board members supported the proposal, saying both improvements would generate revenue for the county and that Ashton Brosnaham’s new indoor sports facility would be multi-use for a variety of sports and community events.
“We have the nickel and we have the ability to bond it,” Bergosh said. “We can do two worthy projects and really move forward. These are big decisions, but I feel like there’s support for this on the county commissioners for at least the next two months. After that, I don’t know, but if we want to get something done, I think now is the time to get something done.”
“I think we’re rushing this,” Patel responded to Bergosh. “You’re right, you only have a couple of months. So I understand the county commissioners feel like they need to rush this, but rushing it doesn’t work. I think we should take it slow. All the parties involved need to be involved in the discussion.”
Other projects recommended for funding:
The TDC also recommended asking PensaCon organizers to provide $350,000 to support the annual pop culture conference, whose representatives told the board their business was hit hard by COVID-19 and is still struggling to recover.
The commissioners agreed, acknowledging the event’s contribution to the community: PensaCon estimates that the week-long event each year brings in between $3 million and $5 million to the downtown Pensacola area.
Ship-shaped artificial reef: USS Oriskany may get a buddy; Escambia considers sinking SS United
The commission also approved a $1 million procurement request from the Escambia Marine Resources Agency for the SS United States, a famous luxury cruise ship the county wants to sink in the Gulf of Mexico and turn into an artificial reef. The project is estimated to cost between $7 million and $8 million. If this latest grant is approved by the commission, combined with the $1 million pledged by state Rep. Alex Andrade, it will bring the total amount raised by Escambia to more than $7.5 million.
