Loss of funding for interchange could kill mall
Orlando Business Journal - by Alan Byrd Staff Writer
It was supposed to be the first of its kind: an upscale mall serving southwest Orlando and the tourist corridor, just off Interstate 4.
Now the 1.2 million-square-foot mall announced in 1994 by Schrimsher Southwest Joint Venture and Melvin Simon & Associates appears to be in trouble.
Orange County officials recommend ending the only funding source now available for a planned interchange at Conroy Road and I-4. The interchange would lead into the mall, as well as office and residential development planned for the approximately 400-acre site.
"Without the interchange ... there will be no large-scale commercial development," says attorney James G. Willard of Shutts & Bowen, who represents Schrimsher.
On Sept. 17, the Orange County Commission is scheduled to discuss whether to extend a community redevelopment area (CRA) agreement first signed in 1990.
Under the agreement, any future property taxes derived from the development of the Schrimsher property would go to pay bonds for a $32 million interchange.
The interchange was supposed to be built by 1993. It was not, and in 1993, the CRA agreement was extended until Oct. 1, 1996, with the understanding that the interchange would be built by 1996.
The interchange has been delayed by changes in plans for I-4, and changes in the way the government issues interchange justification reports, a necessity for any new interchange.
Since the last extension, Florida Department of Transportation has spent $1.5 million to design the interchange. Schrimsher has spent $600,000 to $700,000 in putting together the interchange justification report. Orlando has spent another $150,000.
Schrimsher's attorney says construction on the interchange and on the development could start in a year.
"Simon's interest in the property is still high," Willard says.
But without the county's approval to extend the CRA, the interchange will not get built for quite awhile.
The interchange is part of the state's future plans for I-4, but only because it would be funded by local ad valorem taxes.
"I think this is the only conceivable option to get the interchange constructed," says Richard Levey, deputy chief administrative officer for Orlando. "These projects don't fall out of the sky."
Orange County officials realize this, but they say the county cannot afford to use property taxes to build an interchange that does not offer a definite economic benefit.
"It is not a good idea to use ad valorem taxes for road improvements," says County Attorney Tom Wilkes. "There are a lot of services that the county provides that have no other source but ad valorem taxes."
County officials say there is no comparison between the Schrimsher CRA and the CRAs that provide new interchanges leading into Walt Disney World and Universal Studios.
"The economic benefit of these two well-defined projects far outweighs the speculative nature of developing raw land with no major employment center and no compelling reason for the investment of public funds," writes Deputy County Administrator Warren Wagner in a memo stating Orange County's position. "A return on investment ... is not evident, nor has such ever been proposed by the developer."
Wilkes says the county needs to help out the attractions when it can.
Willard agrees the Conroy Road interchange will not generate a huge return on the county's investment, but says the interchange is a transportation investment.
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