Thoughts on Eastern Wharf
I recently noticed some of the first construction going up at Eastern Wharf (formerly Savannah River Landing), and posted this photo on Facebook, excited that finally, after years of inactivity on that site, the development was moving forward. (And, by the way, this is not even part of my district.)
A little later I saw that someone had shared my post with this comment:
“PEOPLE BETTER WAKE UP!!! THIS IS BEING BUILT WITH SPLOST DOLLARS. OUR HARD EARNED DOLLARS THAT ARE NOT EVEN GOING BACK INTO THE COMMUNITIES WE LIVE IN. MORE FOR THE TOURIST!!”
There are so many things wrong with that statement, it’s hard to know where to start trying to correct it. Even the thought that I needed to respond was disheartening. Trying to correct misinformation on social media is like trying to empty the ocean with a teaspoon.
For starters, how is residential housing construction, “…MORE FOR THE TOURIST!!”? I believe the more residential housing we have, the more we prioritize residents over visitors. In the 2 ½ years of this City administration, we have changed zoning requirements that disincentivized residential construction, and we created a Hotel Overlay Map to restrict size and locations of new hotel construction. 2017 was the highest year ever for the value of new residential permits issued, $90 million.
Eastern Wharf is fundamentally a private, and privately funded, mixed use development, on privately owned land, regardless of this person’s comment or the people who naively accepted it as truth.
Some background: The original developers, more than a decade ago, funded all of the on-property infrastructure—water, sewer, and drainage installations, the existing road network, and all fill dirt as needed. The City did not pay for a dime of this work on private property. The City used two State grants totaling $10 million to pay for the 2,100-foot extension of the Riverwalk, and the floating docks, all of which are public property, the same as the rest of the Riverwalk along River Street.
Then the recession happened, and all work stopped. Now, with new investors, the development is moving forward with a mix of rental housing, private homes, commercial spaces (office, retail, food and beverage), and a hotel, and, in keeping with Savannah’s adjacent downtown, plenty of green space for public use.
There will be some City spending on those public spaces, as well as funding for larger issues that impact not just this area, but large sections of downtown and the eastside, such as drainage improvements. There are several revenue streams that will provide that funding.
SPLOST money comes from a one cent sales tax. When a SPLOST vote is put on the ballot, it comes with a prioritized list of how the money will be spent. Council members often hear from people who say things like, “Don’t build a new arena,” but that is not an option. When a SPLOST vote passes, the money is specifically dedicated to that project list.
SPLOST money being spent in the Eastern Wharf area:
$1.5 million to connect the old Riverwalk to the new Riverwalk in front of the Marriott;
$6.9 million for East President Street and General McIntosh Boulevard improvements, which addressed flooding problems and improved the functionality of one of our community’s busiest roads and major hurricane evacuation routes;
$14.8 million for Bilbo Canal drainage improvements, Bilbo is the primary drainage for much of downtown and the eastside and this work is part of the larger issue of storm water flood mitigation
Tax Allocation District (TAD) bonds are used to fund public infrastructure improvements in a defined area. The bonds are repaid using future tax revenue increases coming from the improved property in that defined area. For instance, if property within a TAD was originally generating $1000 in property taxes, and a TAD was used to fund infrastructure improvements around that property, the expectation is that the value of the property would go up. If the higher value of the property then generates $2000 in taxes, the “new” revenue--the $1000 increase--is used to pay off the debt on the TAD bonds.
Our East Savannah TAD – which includes the Eastern Wharf -- stretches from East Broad Street to the Truman Parkway, and from the river to Wheaton Street. We will use the TAD bonds to fund:
$1.6 million for development of four new public parks, including a waterfront park, within the Eastern Wharf property;
$1.1 million for a road along the Bilbo Canal;
$500,000 to construct a boulevard entrance onto the Eastern Wharf property from East President Street;
$18 million to fund the balance of the East President Street and General McIntosh Boulevard improvements;
$10 million to find the balance of the Bilbo Canal drainage improvements.
Enterprise Funds are departments in the City organization that are self-funded. They generate their own revenue, pay expenses and capital costs from that, and do not normally receive money from the City’s General Fund. Water and Sewer, Sanitation, and Parking Services are examples of Enterprise Funds.
Enterprise Funds being spent in the Eastern Wharf area:
$300,000 from the Parking Fund to pay for sidewalks and lighting improvements adjacent to the City parking garages;
$7.4 million from the Water and Sewer Fund for East President Street and General McIntosh Boulevard improvements.
The City will also spend an estimated $45 million to $50 million to build two public parking garages with approximately 1,400 spaces at Eastern Wharf. These will be for public use, and will incorporate a pickup point for the City’s free downtown shuttle. Developers of Eastern Wharf will donate the land for the public garages, which will be located in an area identified in our parking plan as being ideal for public garage development. The City will pay the debt on those garages using revenue generated from those garages, as we do with all of our other public garages.
While all the public spending is for the public good, it, of course, helps support the development of the Eastern Wharf project, which adds even more benefits to the City and community. It’s too early to know what tax revenue the completed development will eventually provide the City, but the developer has announced plans to invest $600 million on the site. If that is the case, at today’s millage rate, that would generate roughly $3.2 million annually in property taxes, not to mention the additional revenue from sales taxes, hotel/motel taxes, alcohol taxes, development fees, etc.
So, NO! This is not hard-earned local dollars leaving the local community. This is some of those dollars (many of which come from visitors and not just locals) being used to create more public spaces for everyone’s enjoyment, being used to help do more flood management, being used to support better traffic management; and being used to support the development of a new neighborhood that will generate millions of dollars in new revenue for the City’s coffers, benefiting every resident in the City.