A business plan for the financially strapped East Baton Rouge Redevelopment Authority recommends it remain an independent entity with an annual budget of at least $1.5 million.
Funding could come from a variety of sources, possibly including money from the city-parish Office of Community Development, federal grants and higher fees for new building permits.
The report, released Wednesday by SSA Consultants of Baton Rouge, said the authority is working on several projects that could be substantial revenue generators in the future. Those include a land bank of 27 properties on which owners failed to pay taxes, redeveloping the Entergy site on Government Street and the mixed-use Ardendale development off Lobdell. Currently, revenue generated from the organization’s operations isn’t sufficient to cover operating costs in the short term.
“Public funding for a limited period will enable us to continue the good work we’ve begun and to pursue still more promising projects that revive faltering neighborhoods and thereby enhance the health of the larger community,” John Noland, chairman of the organization’s board of directors, said in a letter accompanying the report.
The group was established in 2007 to help revive blighted areas in Baton Rouge. Over the years, it has had a number of accomplishments, such as providing funding for 760 apartments, two YMCA locations and grants that allow neighborhood grocery stores to carry fresh produce.
While the organization does need financial backing, interim President and CEO Gwen Hamilton said money provided could be leveraged over time to make the authority self-sustaining while it revives the neglected parts of Baton Rouge.
Ideally, the general fund allocation would specifically lay out what kind of return on investment the city-parish wants to see and the benefits of the projects the authority is working on. Hamilton said the goal would be to coordinate all aspects of redevelopment through the funding.
This could include increased fees for new construction permits. The extra money could be used to fund the authority and hire more building inspectors, which means permit processing time would be reduced, and the city could do a better job of cracking down on blight and building code violations.
The report notes that permit fees in East Baton Rouge Parish lag behind those of Orleans and Jefferson parishes. The fees for a $400,000 development in East Baton Rouge would cost $1,100, but $2,000 in Orleans/Jefferson.
Hamilton said it was “premature” to say where money from the authority could be drawn from, but there are a number of different options.
The organization has faced problems from a lack of dedicated funding. In 2009, it was awarded $60 million in New Market Tax Credits, which are part of a federal program targeting investment and real estate projects in low-income communities. That had provided a source of administrative funding, but since then, the organization’s applications for more credits have been turned down by the U.S. Treasury Department.
The goal of the authority and its supporters is to keep the organization going until new sources of funding can be found. Mayor-President Kip Holden has rejected calls to provide permanent funding for the group, saying the city-parish has too many other obligations. Holden will leave office in January, and the authority said it has enough money to operate until a new mayor takes office. At Holden’s request, earlier this month the Metro Council allocated $100,000 in BP settlement funds for the organization, enough to ensure it will remain operational until 2017.
The group’s 2016 budget projects spending at $408,263 in 2016. That’s a step down from the amended 2015 budget, which ended up with $742,800 in spending.
The organization has slashed spending by cutting employees and reducing its office space. While former President Walter Monsour had a compensation package of $365,000, including benefits, Hamilton is making $75,000 a year.
Hamilton said the goal of the report is to create “a real strategy to implement and support the RDA” as intended.
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