Council Paves Way for Pen Air

Once it had become apparent that the Pen Air deal was hitting a true snag, Mayor Ashton Hayward made his way into the meeting room. He took a seat a few rows back in the gallery and waited for a chance to address the Pensacola City Council.

“We’re talking about Pen Air Credit Union, we’re not talking about some run of the mill business,” Hayward told the council a few moments later. “This is an incredible opportunity for all of you and the administration to have another win under its belt.”

During its Committee of the Whole meeting yesterday, the Pensacola City Council considered if it should forgive a nearly $80,000 loan to the Downtown Improvement Board. Forgiveness of the loan, the council was informed by City Administrator John Asmar, is directly tied to a current deal the DIB is offering Pen Air in an effort to bring the institution downtown—the DIB is offering the credit union parking spaces for 110 employees.

“Basically, what we’re trying to do is partner with DIB on  economic development,” Asmar told the council.

Pen Air is looking to lease, then buy the Thiesen Building, a historic building located at Palafox and Romana streets. The company intends to make needed renovations and fill the building with more than 100 medium-income earning workers. Asmar said forgiving the loan worked in the city’s favor because the business was agreeing to forgo any kind of EDATE related property tax reductions.

“If you multiply 8,800 times 10, you’ll know that it’s greater than the $79,000 bill you owe,” Asmar said.

But council members saw the loan forgiveness as “a subsidy” for Pen Air. Council member Maren DeWeese said the arrangement was “bringing a good situation to an impossible question.”

Councilman Larry B. Johnson said that he didn’t think taxpayers should be, in essence, paying for Pen Air to have free parking spaces. He said the seller should be asked to pony up the money needed to offset the math and make DIB feel comfortable with the deal.

“I hope you understand the dilemma we’re in,” Johnson told Pen Air Executive Vice President Carroll Scarborough. “We’re kind of the watchdogs of the taxpayer’s wallet.

Johnson went on to say that he was pro-business and wanted to see Pen Air come downtown, but that the prospects of having the taxpayers fund such a move was giving him “real heartburn.”

Councilwoman Megan Pratt said that she was having difficulty dealing solely with the DIB loan forgiveness without associating it with the Pen Air deal—“It’s hard to separate the two in my head.”—and also questioned how many truly new jobs would be generated by the company’s move. The councilwoman was told that 58 of the jobs would be new.

“We’re calling this economic development, but we’re really just rearranging the deck chairs,” Pratt said, adding that a bank might not be the type of business that officials should be luring to downtown—“banks really don’t contribute to the vitality…”

Councilman Brian Spencer said that he recognized the “complexity” of the issue, but said he supported forgiving the DIB loan in an effort to get Pen Air downtown. He argued that the credit union would be a welcome addition to the downtown landscape.

“Building cute boutiques and retail stores and ice cream parlors isn’t necessarily what brings people downtown,” Spencer said.

Councilman P.C. Wu said he was “absolutely ecstatic” about the prospects of Pen Air coming downtown, and apologized to Scarborough for having to endure the council’s line of debate.

“You should be given roses instead of treated to harsh questioning,” Wu told the executive.

Councilwoman Sheri Myers told Scarborough that she would feel better if the company was immediately purchasing the Thiesen Building—demonstrating a more long-term commitment—instead of leasing  the property at first. Scarborough said the company had chosen to lease initially due to tax reasons and that it did not plan to renovate the historic building only to later vacate it.

“I can assure you that we do not plan to walk away from those dollars,” Scarborough said, explaining that all but the first floor would require extensive renovation.

A member of the audience told the council that she had attended the DIB meeting during which the Pen Air deal was discussed. She didn’t understand the council’s hesitancy.

“The thing that you’re looking at is the very thing that you are paying people tens of thousands of dollars to comb the country for,” she said. “Of course the DIB approved it … why would we not just jump right on board?”

Councilman Johnson maintained that the seller should be approached and asked to contribute toward the effort before going to the taxpayers.

“I don’t want to dance around it. I don’t want to call out his name,” Johnson said. “This person has the ability.”

Sitting in the audience, Mayor Hayward appeared increasingly agitated.

“It’s not between the seller,” the Mayor said under his breath. “It’s between the DIB.”

Council President Sam Hall said that he was convinced that the deal was a good one for the city and called the matter to a vote. The council voted 6-3 to forgive the DIB loan—with DeWeese, Johnson and Pratt dissenting—thus paving the way for Pen Air to get its desired parking spaces and move downtown.