The area just south of downtown Orlando is primed for explosive growth — and city officials want to raise taxes to make sure it's ready.
Orlando Health is in the midst of a $300 million expansion. And a new SunRail stop is coming. Both will increase market pressure to redevelop a part of town that still has lots of industrial property.
"This area is poised to be a remarkable redevelopment opportunity for the neighborhood and the city as a whole," Orlando planning division manager Dean Grandin said. "But to do that you really have to invest in the area beyond what the city can do."
In an effort pushed by Orlando Health, the city and major landowners have identified tens of millions of dollars worth of transportation, infrastructure, aesthetic and other improvements they say are needed.
The city plans to call a special referendum in May, limited to property owners within the district, who will decide whether to pay higher taxes to help bankroll the upgrades.
But some property owners worry they'll have to pay for improvements they don't want because the hospital chain and other large landowners carry most of the voting power.
"The concern I have is the fact that we won't have a say," business owner John Law said. "It seems like they're doing it and it's going to happen whether we're on board or not."
The "Downtown South Neighborhood Improvement District," as it's been dubbed, covers 523 acres south of downtown, including a 1.5-mile stretch of Orange Avenue. It's bounded by Gore Street on the north and the Michigan Street corridor to the south, and includes the property between Orange and Interstate 4.
It's an area with industrial roots, because the railroad tracks cutting through it provided an easy way to move freight. Though less dependent on rail access these days, plenty of industrial-zoned businesses still dominate the half of the district closest to I-4 — from concrete-block manufacturing plants and recycling centers to metal fabricators and large warehouses.
But on the east side, the hospital dominates. The Orlando Health campus, which includes several hospitals and ancillary buildings, is undergoing a major expansion.
With the growth of the hospital campus, other landowners are considering redeveloping their property for medical offices and other health care-related uses. The city has already approved plans from Orlando Medical Plaza, directly across the street from Orlando Health, to build an 85-room hotel and a pedestrian bridge spanning Orange Avenue.
Sodo, the mixed-use development at Orange Avenue and Grant Street, redeveloped a block of industrial property in 2007. Anchored by a Target, it includes 370,000 square feet of restaurant and retail space, about 75,000 square feet of office space and 300 residential units.
Planners expect more redevelopment with the opening of a SunRail commuter train stop near Orlando Health. The so-called "transit-oriented development" would bring more densely packed commercial and residential construction, they say.
"You're going to see more intensive development and growth of that entire area. It's one of the hot spots," chief planner Jason Burton said.
At the same time, city officials say, the district is being held back by poor transportation connections, inadequate infrastructure and a generally worn look.
That's where the new tax would come in. If property owners approve, the city would raise taxes in the district by up to $2 per $1,000 value, on top of the $5.65 the city now levies (though staffers say they'd likely impose half that much). A property with an assessed value of $250,000 would pay an extra $500 a year if the city levies the full amount.
The maximum tax would raise about $750,000 a year for the next 15 years. The city would spend the money to extend downtown's free Lymmo bus circulator south to the hospital; beautify the Orange Avenue and Michigan Street corridors; and add sidewalks, bicycle lanes and other pedestrian improvements.
The original plan would also have imposed a flat $500 annual fee for every parcel in the district. That would have required approval from the majority of registered voters in the district, of which there aren't many. The vote would likely have failed, and the fee idea has since been dropped.
The process for approving the tax is different. Rather than registered voters, property owners are the ones who will vote.
The vote is weighted to those who own the most valuable property. Orlando Health alone controls 22.5 percent of the vote. Much of Orlando Health's property is tax-exempt, but the company supports the plan so much that it has agreed to make a payment anyway.
In fact, Orlando Health has provided the $175,000 budget to develop the plan and hire consultants — including former Orange County Mayor Rich Crotty — to work on the referendum.
Orlando Health board member Rex McPherson II, who also chairs the Downtown South advisory board, said the hospital has already made a substantial investment in its own property and is willing to chip in to help the rest of the district. "When you live in a neighborhood, you want the houses around you to look nice," he said. "It's as simple as that."
Some business owners, particularly those with industrial property, don't see how improvements primarily along Orange Avenue would benefit them. McPherson said the upgrades will ultimately make all the property there more valuable.
Still, there's a feeling that city officials would like to see longtime industrial businesses move out of the district, freeing up land for the shift toward commercial and residential redevelopment.
"With the clout Orlando Health has, it's going to pass," said Todd Hunter, plant manager at Modern Welding Company of Florida, which employs 44 workers at the Division Avenue location where it's been for 65 years.
"But I don't see how Lymmo and beautification is going to help our business at all."
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