Local developer Michael Wray may be justified in protesting a rules change in the middle of his six-month bid for downtown incentives for an apartment complex he seeks to build. He may even have a point that other hands compromised his pivotal involvement in the high-profile Heritage Square project a few years ago — good enough at the time to get him ejected as its general manager.
That said, city leaders are also right to tweak, revise and greatly refine the criteria by which the downtown Tax Increment Financing Zone board determines what projects rate public incentives. And the Waco City Council is right to question the details of specific proposals, even after they’ve passed muster with the TIF board. In that respect, Mayor Malcolm Duncan Jr. was absolutely justified when he questioned Wray’s latest project in May, including the size of the developer’s $200,000 fee in a $1.8 million project, as well as cost estimates deemed too vague.
In the final analysis, the TIF board and the council should obviously play fair with developers who seek to build upon the dynamic vision many of our citizens have for downtown Waco. But our city leaders have a far greater obligation to a doubting public that, right or wrong, is increasingly skeptical of how taxpayer funds are employed, especially in terms of economic incentives for projects that may no longer justify such public investment.
One feels sympathy for Wray’s particular predicament, given how things turned out regarding his earlier involvement in the prominent Heritage Square development project. After major cost overruns and millions of dollars in liens from contractors and subcontractors, he was ousted. He suggests some of the blame involves the particularly complicated nature of the project, including the large number of individuals who were caught up in the undertaking.
More to the point, he voices concern about the TIF board’s continuing deliberations over this latest project and how it fits the grand scheme for developing downtown Waco along the Brazos riverfront. Initially, the TIF board recommended funding 10 percent of eligible development expenses for his proposed 24-unit apartment complex at 701 S. Sixth St. — down from the usual 15 percent after city leaders began revising criteria to address shifting priorities that put more emphasis on projects focused on entertainment or playing off a direct connection to the river.
On May 21, the council expressed legitimate concerns about the Wray undertaking, sending it back to the TIF board for a closer evaluation. And this Monday, the TIF board recommended $80,000 in publicly funded incentives, or 5 percent of eligible expenses — half the amount it had recommended to the city council this spring. Understandably, Wray protests that city officials, in so many words, moved the goal posts for a project he submitted back in December.
Yet Wray and other developers must remember that overall downtown development is a massive work in progress, one that is a credit to city officials, local businessmen, private investors, the Greater Waco Chamber of Commerce, the TIF board and, yes, developers like Wray himself. By the same token, as certain pieces in the puzzle of downtown revitalization finally fall snugly into place, it’s only logical to re-evaluate and revise the criteria for whether or not a new project still rates public funding to help with its construction — and how much it should get if it does qualify.
Such discrimination by city leaders is vital to economic development, especially when our tax dollars are employed to help private endeavors become reality. To fail in this critical regard risks the public going from merely skeptical to downright cynical — and that could spell trouble for what many imagine downtown Waco can be.