(ran SS edition of METRO & STATE)
Clearwater's incentive package for IMRglobal Corp. has not had the big returns that officials expected.
When the city dangled $1.8-million in financial incentives to lure IMRglobal Corp.'s headquarters downtown three years ago, city officials argued that taxpayers would get an excellent return on the investment.
Officials touted a study that projected IMRglobal would generate an estimated $3.2-million in property taxes, utility fees and other revenue for the city over 20 years _ not to mention a multimillion-dollar boost that the new jobs would add to the area's economy.
But a recent city analysis paints a far less rosy picture.
By the numbers:
+ Although the city estimated it would take in $3.2-million, the payback is now estimated to be $1.7-million because IMRglobal has not developed as fast as originally thought.
+ Although the city estimated $2.3-million in profits, the new estimate shows only a $207,446 gain from the deal.
+ Although the city anticipated its parts of the incentives would be about $900,000, it ended up spending $1.5-million.
The major expense was cleaning polluted city land at Missouri Avenue and Cleveland Street that Clearwater sold to IMRglobal.
City Commissioner Ed Hart, who requested the analysis, criticized the way in which the city originally sought the very optimistic estimates to gain support for the deal. Hart said the city ought to use more conservative estimates for the economic impact of projects or give a range of possible figures.
"You need to couch what you say to people with very specific guidelines," Hart said, because an overly optimistic and off-the-mark estimate "does not give you credence. It damages your credibility."
But City Commissioner Bob Clark, who considers working on the IMRglobal deal one of his finest moments, says the payback to the city from IMRglobal has been sufficient _ even if less than projected. Clark said IMRglobal has added new jobs downtown and the city gained invaluable "bragging rights" that the company is here.
Mayor Brian Aungst said the city may drive a harder bargain with future redevelopment deals that involve city incentives. But since IMRglobal was acting as a trailblazer, Aungst said, the city had to cut a good deal to attract the company.
IMRglobal's new, modern corporate buildings downtown have helped city officials market a rundown area for redevelopment, said Bob Keller, assistant city manager for economic development. New projects nearby include an Eckerd drugstore and a planned community of more than 100 townhomes, Keller said.
But such "spin-off" deals aren't reflected by the city's recent sobering assessment of what it gains directly in taxes and other profits from IMRglobal's development, Keller said.
IMRglobal initially planned to have three buildings constructed by 2001 and as many as 700 employees downtown. But so far, there are only two office buildings and about 400 employees, said Al Justice, the Clearwater developer overseeing creation of the IMRglobal campus. Officials at IMRglobal could not be reached for comment Wednesday.
There is no date to start the third building, Justice said, although it could still be constructed as the company grows. The software company has been restructuring itself this year after its stocked plunged 57 percent in 1999.
Keller emphasized that IMRglobal was never under any obligation to build everything that was originally planned _ even if the city's economic impact estimates hoped the company would.
"What the new numbers show is that IMR has not completed its most optimistic scenario," Keller said. "The world has changed."
_ Information from Times files was used in this report.