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Councilwoman Calls For Lot J Project Payback Guarantee If Jags Leave; Developers Say No

rednering image of a tall building with trees, and pavement where people are walking along, everything is computer generated
Jacksonville Jaguars/ Via Jacksonville Daily Record
A proposed rendering of the Lot J development upon completion.

Representatives from Jacksonville Mayor Lenny Curry’s administration and the Jaguars fielded more questions from City Council Tuesday on the proposed Lot J mixed-use development project. A council vote is expected in early January.

Councilman Danny Becton said he believed what hadn’t been properly communicated to Jacksonville taxpayers yet was how negotiators landed at a $250 million city investment being required.

“I don't think we've spent in any of our meetings, any time, or very little time, trying to understand how y'all landed on $250 million,” Becton said.

In particular, Becton asked how the administration agreed to a $53 million construction grant to the Cordish Companies, the proposed developer of the project.

Jordan Elsbury, who has served as the city spokesperson for the project, said at the beginning of Lot J’s project formation, it came down to realizing the “project scope,” and the money figure necessary to meet its goals.

Jaguars President Mark Lamping said when put in the perspective of this being a traditional project, there are “obvious questions” when it comes to city investment.

“This is the furthest thing from a traditional project,” Lamping said. “This is basically the creation of a new neighborhood, and when we look at this neighborhood, if it's created, and it works - and we believe it can under the right direction - it's going to create waves and waves of benefits from the city, going forward.”

Lamping said the amount of infrastructure created from the project would outweigh the city costs by having long-term benefits.

“We need people to know no one visits there on non-event days, and we need people to visit on non-event days,” Lamping said. “There's no hotel. The entertainment industries are challenged. People do not drive from outside the region to this site.”

Becton indicated he wasn’t satisfied with those answers, however, saying that the $53 million dollar construction grant can turn into a more than $100 million cost for the city, when including interest.

The councilman also said there was concern that the project is “anti-competition,” because it would have a financial advantage over other Downtown businesses.

Once again, Lamping countered the argument by pointing to the potential benefits.

“We believe this is a sound way to go about it,” Lamping said. “We believe in Downtown. We're prepared to invest hundreds of millions of dollars and the taxpayers are doing likewise.”

Councilman Al Ferraro asked Elsbury to go more in depth on how the city came to a decision of giving a $65 million, 50-year, no interest breadbox loan to Jaguars owner Shad Khan for the development, saying constituents didn’t have a great understanding of that aspect of the project either.

Elsbury said the money was initially going to be in the form of a grant, but tax law changes meant a 20-30% portion of the city’s incentives would be going to the federal government, which the administration didn’t want. 

“This solution guarantees some level of return that we never contemplated with the original grant opportunity,” Elsbury said. “Immediately 20% goes back into a trust that the taxpayers are going to recapture, sure, at a time in the future, but it's going to work like an annuity.”

Councilwoman Randy DeFoor said she would be more comfortable with approving the deal if the city could choose the breadbox loan trustee, and a $150 million clawback provision in case the Jaguars choose not to renew their lease.

“That clawback keeps everybody honest, because what we don't want to do is get to a negotiation of the stadium lease with a $200 million liability wrapped around our neck,” DeFoor said. “That puts our community in a very dangerous position.”

Lamping and Jaguars officials said that is not something the team would be willing to do, considering all of the investments Kahn has already made to the city.

“To place a condition on Shad’s pledge and promise to Downtown Jacksonville is also wrong,” Lamping said.

But DeFoor said adding the clawback provision would show a true partnership between the team and the city.

“You are asking this city for over $200 million, a quarter of a billion dollars,” DeFoor said.  “And we're simply saying, and taking you at your word, that you're going to stay here in Jacksonville. And if that in fact is the case, that should be a gimme for you.”

Paul Harden, a Jaguars lobbyist, said it’s not in Kahn’s control on an extension on the lease.

“It's not within his control as to whether or not we can do additional work at the stadium, and it's not what it is control whether the NFL owners believe that Jacksonville is a fit city,” Harden said. He’s trying [to do] everything he can.”

Harden continued, “He could have walked away and gone to another city,” adding, “He could’ve taken the opportunity that San Diego took to go to Los Angeles. He could have taken the opportunity that Oakland took and went to Las Vegas. He could have taken the opportunity, the Rams took and when they were brought to Los Angeles.”

Harden said Khan has withstood pressure from those encouraging him to move the team. “Don't think for one minute he didn't get a lot of pressure. He likes Jacksonville,” Harden said.

While there were several questions regarding the viability of the financial figures of the project, several council members also showcased their support to approve the Lot J deal.

“This is a decision by us whether we want to keep Jacksonville in [the] 1990s, or we want to make it a great city that everybody wants to come to,” said Councilman Aaron Bowman. “This is a great opportunity for us.”

Councilman Terrance Freeman said his previous career as a minor league baseball player has made him realize the importance of investing in local sports teams.

Councilman Reggie Gaffney, whose district includes Lot J, said he hopes the city doesn’t squander the chance to build the development.

“I'm so nervous that this city might miss, perhaps, I think, one of the best opportunities, based on what I know and understand, in the next 20 to 30 years,” Gaffney said.

City Council auditors said while they have been able to come to an agreement on many questions on the agreement, there are still several items they need to iron out and provide clarification on.

Gaffney said he plans to hold another meeting where the items that the council auditors and Jaguars are separated on can be discussed more in-depth in the coming weeks.

Sky Lebron can be reached at, 904-358-6319 or on Twitter at @SkylerLebron.

Former WJCT News reporter