DeBary's City Manager said incentives from the Live Local Act, which was designed to promote affordable housing, are luring away a $100 million development from the community.
Local government leaders plan to form a research group in response to DeBary City Manager Carmen Rosamonda's comments at a recent meeting of the Roundtable of Volusia County Elected Officials.
Rosamonda said at the meeting that officials behind an approved industrial park plan to let the development agreement expire and sell to an apartment developer.
While he didn't name the development, city spokeswoman Shari Simmans said the development Rosamonda was referring to is DeBary Commerce Park.
No final plans yet
A representative for the current owner and developer of the property said there are no final plans for a sale and the industrial development might still be built.
In 2019 the DeBary City Council approved the project. Specifically, the council voted to allow land use and zoning changes on the property. The property is about 24 acres between U.S. 17-92, which is also called South Charles Richard Beall Boulevard in that area, and South Shell Road about a mile from Konomac Lake. The land is vacant, according to the property appraiser.
The project is approved to build "an industrial park with approximately 125,000 square feet of space and two commercial frontage tracts along US 17-92," according to meeting documents. Plans include nine buildings, and the frontage land could be used for restaurant or retail-style commercial development.
That project would boost the city's tax revenue by well over $1 million a year when fully built out, Rosamonda said. He also said it would bring 500 jobs or more to the area. But if sold and developed for affordable apartments under certain Live Local Act provisions, the project will be tax-exempt, he said.
In that case, "They're not only 100 percent tax-exempt for city taxes but for state taxes, for county taxes and taxes for schools," he said.
The applicant for the project in 2019 was KBC Development, and the land is owned by DeBary Industrial Park LLC, according to Volusia County property appraiser's website. Both firms have the same Sanford address.
DeBary Industrial Park is led by Michael Good, according to state business records. Good was unavailable for comment on Friday afternoon, according to Patti Sholar, real estate broker with KBC Development.
Sholar said a sale is possible but not guaranteed. She said officials associated with the project didn't believe it was appropriate to talk about the potential buyers.
Several potential buyers interested
"We have several people interested in the property," Sholar said.
Simmans, city of DeBary spokeswoman, said via email the city learned of the plans after receiving a letter from "the potential developer." The News-Journal has requested a copy of the letter, but it wasn't immediately available on Friday afternoon. Simmans said via email that the letter needed to be checked in case it contained non-public information.
The Florida Legislature passed the Live Local Act this year, a sweeping measure that's funneling $711 million into affordable housing programs and incentives aimed at helping housing developers and state residents. However local governments are still trying to understand its impacts.
The law provides multiple tax exemption possibilities for affordable housing projects. It also ties the hands of local government in key ways.
Among other things, a local government such as Volusia County or one of its cities must approve "multifamily and mixed-use residential as allowable uses in any area zoned for commercial,industrial, or mixed-use if at least 40 percent of the residential units in a proposed multifamily rental development are, for a period of at least 30 years, affordable."
That means that areas that were never planned for residential uses are now open to housing development because of the law.
Concerns about school capacity
Rosamonda said an affordable housing complex developed under the Live Local Act standards would also pose an issue because of school capacity. The city's only school is already at 115% capacity, he said.
"We are faced with trying to house 759 units, possibly 759 units, 2,100 residents, which this one project alone will increase DeBary's population by more than 10 percent," he said.
He said he believes the law's incentives will make it "a redevelopment law."
"And you're going to see tracts of commercial land like malls and other things be so incentivized that they will sell off because it's more profitable to sell off to an apartment developer than to continue to operate business," Rosamonda said.
Rosamonda suggested that the Roundtable of Volusia County Elected Officials create a subcommittee to advocate for changes to the law and research how it will affect the county and its communities. Volusia County Chairman Jeff Brower and DeBary Mayor Karen Chasez agreed to form a subcommittee.
The roundtable plans to further discuss the Live Local Act at its next meeting on Nov. 13 at the Daytona Beach International Airport, and the meeting will be open to the public.
Brower said the law will indirectly tax residents, and he described it as part of a larger problem that local governments have with state laws interfering with their decision-making.
"The county worked for over a year and has developed a really good affordable housing program," Brower said. "We need to let it work out and not have this preemption come in and stop us from doing the things that we would like to do and forcing us to do things that none of us want to do."
Chasez said she doesn't see a way to get a developer to build the kind of infrastructure that will be needed for an apartment to go at the site because it was never expected to be residential. Existing DeBary residents would face "a tax hole" after development and have to pay for part of the infrastructure, she said.
"We need to find a way to develop affordable housing, but this broad brush ... it's going to be problematic in virtually, I think, every municipality and the county as we go forward," Chasez said.
― Reporter Eileen Zaffiro-Kean contributed to this report.
This article originally appeared on The Daytona Beach News-Journal: Live Local Act draws $100M development away, city official says