Lake City, City Manager Wendell Johnson looks to make White Elephant deal with troubled North Florida Broadband Authority
Posted February 28, 2012 08:55 am | Also Posted as NFBA Part XV
City Manager Wendell Johnson explains his plan and letter from the North Florida Broadband Authority to the CRA Advisory Committee. City Councilwoman Moses is to his right and CRA Director Jackie Kite is to his left.
LAKE CITY, FL – Last night Lake City, City Manager Wendell Johnson surprised Lake City's Community Redevelopment Agency with another scheme to buy and renovate the Vann family's Powers Building on Main Street. This time with the troubled North Florida Broadband Authority. City Manager Johnson is on the Board of Directors of the NFBA and has said he visits with them about three times a week.
Last year City Manager Wendell Johnson was blown off by the Lake City Chamber of Commerce and the Historical Society in his attempt to acquire the Vann family's Powers Building for them. At that time, City Manager Johnson's idea was to have the City buy and renovate the building, which is now just a shell, and have the two groups take it over and sustain it. The deal never got off the ground. Last night Mr. Johnson explained that problem this way: "They could not envision the same things that I was envisioning... It was the fear of the unknown."
City Manager Johnson hatches new scheme
Now, City Manager (CM) Johnson has hatched a new scheme for the Vann's Powers Building.
On February 15, 2012, the North Florida Broadband Authority's Interim General Manager, Richelle Sucara, sent a letter to CM Johnson which began: "I am pleased to tell you that the North Florida Broadband Authority (NFBA) is very excited about discussing the possibility of renovating the Powers Building located on 600 N. Marion St. with you."
City Manager Johnson is a member of the Board of Directors of the NFBA. He has mentioned that he visits the NFBA about three times a week.
The North Florida Broadband Authority has never publically discussed the issue of the Powers Building.
After holding the letter for almost two weeks, City Manager Johnson released the NFBA letter to the CRA Advisory Committee (the Committee) at last night's meeting.
Earlier in the day, CM Johnson attended a NFBA meeting. The issues of space were brought up at that meeting. No one from the Cadre of the NFBA mentioned a word about the Powers Building. Lake City's City Manager sat silent. During the NFBA's discussion the letter was not mentioned by Interim General Manager Sucara, nor NFBA Chairman Tommy Langford, nor NFBA Vice Chair Pat O'Neal, nor NFBA Project Manager Donny Lort, who recently falsified his resume to the NFBA and has had Badges of Fraud pinned on him by a Federal Judge.
City Manager Johnson told the CRA Committee, "I have spoken with the Chairman of the Board and I have spoken with the General Manager and the NFBA is looking for a permanent location."
CM Johnson keeps the facts from the Committee
The NFBA has no money, no revenue, no business plan and no customers, facts of which Lake City Manager Wendell Johnson are well aware.
CM Johnson proposed that "The City would acquire the building. The City would bear the cost of renovation... We would be the go between... They would do it directly with the current owner, which is Mark Vann."
CM Johnson said the building was appraised at $152,000 and has a code enforcement lean against it of $5,000. The building is in probate.
CM Johnson said, "I'm certain Mr. Darby (City Attorney) may have a lot of problems with this."
CM Johnson explained, "The City Council would have to fund the building." He wasn't sure if the deal with the NFBA would be a grant or they would have to pay the money back.
CM Johnson said, "The NFBA would be responsible for carrying out the redevelopment process." According to CM Johnson, "The City would pay for the construction activity and at the time the NFBA goes operational or sustained, they would pay the City back for the redevelopment costs."
The NFBA Board, who doesn't know a thing about this, would have to approve it.
CM Johnson explained, "That keeps the City from having to own the building. That keeps the City from having to bear the competitive process for redevelopment. We [the City] would just be the funding agency."
CM Johnson Misrepresents NFBA Warehouse Rental Costs
City Manager Johnson then misrepresented the long term rental costs now being paid by the NFBA.
The NFBA is presently on a $5,000 month to month warehouse lease in which it is storing its equipment during the NFBA build out. It is common knowledge and has been discussed at the NFBA that the warehouse will not be needed once all the NFBA's equipment is installed. That was the reason for the month to month lease, a fact CM Johnson is familiar with.
CM Johnson said the financial position of the NFBA will not be known until the first quarter of 2013. It is at this time that the NFBA will have to be producing revenue, instead of living off grant money from the federal government and bank loans from TD Bank. The NFBA is paying TD Bank 5% interest.
City Manager Johnson summarized his deal this way, "In essence the City will be giving them a no interest construction loan. Until the loan is paid off we are the mortgage holder."
City Attorney Darby weighed in: Something should be done to the building. As you know we are in some very trying times. Economically the economy is bad and particularly as it relates to real property. Private parties are pushed pretty hard. The availability of capital has been restricted... I do not believe that any private investor would do anything with that building. The economics are just not there. The feasibility is just not there."
CM Johnson said the Community Redevelopment Agency does not have money to do the financing. If they [NFBA] fail, "Private investors are not going to go down and buy this building and do anything with it."
The CRA Advisory Committee voted to proceed with negotiations and discussions with the NFBA.
It is not clear when the NFBA Board of Directors will be told about this White Elephant deal with the City of Lake City.