Clearwater housing project had a green light. Then Scientology stepped in.

The developer says church dealings didn’t kill the project, but records tell a more complicated tale.
The city's former Fire Station No. 45 is in the foreground on Franklin Street with the Church of Scientology's Flag Building to the west.
The city's former Fire Station No. 45 is in the foreground on Franklin Street with the Church of Scientology's Flag Building to the west. [ TRACEY MCMANUS | Times ]
Published Sept. 11, 2022

CLEARWATER — The Church of Scientology was calling again, so Shawn Wilson, a developer planning an 81-unit affordable housing project downtown, quickly hung up.

He then typed an email to Scientology legal director Sarah Heller, apologizing for ending their call abruptly. He asked her to write what she wanted to say in an email instead.

But Heller called two more times.

Wilson, president of Blue Sky Communities, emailed Clearwater City Manager Jon Jennings stating he would talk to the church only in writing about changes the three were discussing to his development.

“Ms. Heller seems to always want to talk on the phone or meet in person,” Wilson wrote to Jennings on April 20. “Please appreciate that Blue Sky operates in a very regulated industry and our corporate culture is to be open and transparent.”

Two months later, Wilson abandoned his plan to build affordable housing at a vacant city fire station, a priority project that was three years in the making and almost ready for permits.

Its rise and fall, documented in emails and interviews, provides a rare inside look at how land deals in the city’s struggling downtown unfold, often guided by Scientology’s sprawling property interests.

In a statement to the Tampa Bay Times, Wilson said he killed the project at 601 Franklin St. because rising costs made it financially unfeasible. Scientology “did not pressure us in any way,” he said.

But city emails obtained by the Times show that in the months before the deal fell apart, the developer, Scientology and Jennings were attempting to relocate the housing to a different site so the fire station could be used in a land swap between the city and church.

Jon Jennings
Jon Jennings [ City of Clearwater ]

City Council members had approved the housing at the fire station, seen as an important step in supporting Clearwater’s large population of hospitality workers. Yet none of the council members, except Mayor Frank Hibbard, said they knew these discussions were occurring before the deal fell through.

The relocation was not possible because the state declined to transfer $17 million of tax credits awarded to the fire station project to any other site. But Wilson didn’t mention financial concerns when he canceled his agreement to buy the land from the city to build housing.

“Despite all of our best efforts on this city-sponsored concept, there is still a great deal of uncertainty about what is best for the city of Clearwater,” Wilson wrote Jennings on June 10. “Because of this, we think it may be best to terminate the agreement.”

• • •
Spend your days with Hayes

Spend your days with Hayes

Subscribe to our free Stephinitely newsletter

Columnist Stephanie Hayes will share thoughts, feelings and funny business with you every Monday.

You’re all signed up!

Want more of our free, weekly newsletters in your inbox? Let’s get started.

Explore all your options

Scientology did not respond to a request for comment. But the church has long coveted the fire station property, which is just east of its seven-story Flag Building and just north of a lot where Scientology plans to build a 4,000-seat auditorium.

In early 2019, the city asked developers for ideas on how to transform the property. The church was the only respondent, suggesting it would build a “multipurpose cultural center.”

The city declined and invited developers to submit affordable housing proposals. The City Council voted unanimously in October 2019 to enter an agreement with Blue Sky to get it done.

It took two years, but Blue Sky secured $17 million of state tax credits in 2021. By then, costs had swelled due to inflation, so Wilson prepared to ask local government for help.

That November, the council hired Jennings as the first new city manager in 20 years. He began talking with Miscavige about the church’s plans for dozens of properties that were sitting vacant. It was a fresh start for a city-church relationship that had soured under former City Manager Bill Horne.

Their talks included a potential exchange of properties to help Clearwater’s downtown revitalization efforts.

Jennings said Miscavige wanted the fire station, but the city was already in the deal with Blue Sky for the affordable housing.

Wilson asked the city for additional funding in December, and the council voted 4-1 to allocate $1.8 million of its state and federal housing dollars. Mayor Hibbard voted no, in part because the land could be better used as a bargaining chip in a swap with the church to obtain better properties, he said.

Wilson then asked Pinellas County for help. In February, the County Commission dedicated $2 million to the affordable housing project at the Franklin Street fire station.

• • •

As the city and county gave additional funding, Wilson told city staff that architectural drawings were underway and that he would apply for building permits by May, emails show.

Wilson confirmed that around this time Scientology contacted him to discuss moving the location of his project. Wilson said he then called Jennings, who was supportive.

Jennings said he helped facilitate the talks because Wilson had financial concerns and Miscavige had a desire to build a museum honoring Scientology founder L. Ron Hubbard at the fire station.

“I think what I was thinking through at that time was can we do something that is a win-win, both getting affordable housing, but on a different location and having that available for a possible land swap,” Jennings said.

Jennings said Miscavige offered an alternate site for Wilson: a vacant lot on Martin Luther King Jr. Avenue and Grove Street owned by a limited liability company managed by a Scientology parishioner.

But in an April 12 email to Jennings and Heller, the Scientology legal director, Wilson stated it was unlikely the state would allow the $17 million in tax credits to transfer to the new location. He suggested a “creative solution.”

Shawn Wilson, president of Blue Sky Communities, addresses the Clearwater City Council in February.
Shawn Wilson, president of Blue Sky Communities, addresses the Clearwater City Council in February. [ City of Clearwater ]

Wilson offered to allow Scientology to use part of the property or sell “our completed building to the church for the church to use as housing for income-qualified members/staff,” according to his email.

Jennings said he called the Florida Housing Finance Corporation to explain the situation and advocate for the transfer. But on May 3, a Florida Housing representative wrote an email to Jennings and Wilson explaining that the transfer would not be possible.

On June 10, Wilson emailed Jennings to terminate the agreement for the housing project altogether.

Jennings said he heard Scientology paid Wilson $2 million to walk away from the Franklin Street site, but said he could not recall who told him that information.

In a statement to the Times, Wilson said he had $1 million of unrecoverable costs invested in the housing plan and that it would be inaccurate to say he terminated his project because he “received a profit of $2 million.”

He declined to answer follow-up questions about whether he received any amount of payment from Scientology.

In May, when the relocation was still being discussed, Wilson stated in an email to Jennings that he expected to be reimbursed for “non-recoverable costs” related to the project.

Florida Housing confirmed that Blue Sky returned the $17 million in tax credits earlier this year.

Jennings said he was trying to facilitate moving the housing for the swap because “the city is my primary responsibility” and a swap would help downtown revitalization.

The swap is centered on Scientology acquiring a 1.4-acre lot on Pierce Street, a waterfront parcel that Miscavige has wanted to acquire for years.

In 2017, the Clearwater Marine Aquarium turned down a $15 million offer from Miscavige and sold the lot to the city for $4.25 million. That triggered a countermeasure from Scientology — a five-year buying spree where companies tied to the church have purchased about 145 properties in and around downtown and have kept most of them vacant.

Jennings said if the land swap goes through, it could help transform downtown. He declined to confirm which parcels the city might acquire from the church, citing ongoing negotiations.

Although the fire station property is now back in discussions for the church, Jennings said the swap is stalled as he and Miscavige continue to disagree on which parcels the city would receive in exchange.

“I really believe in my heart we are going to come to an agreement on a land swap but there’s 45 years of city and Church of Scientology history,” Jennings said. “I’ve been here 10 months. We’ve made a lot of progress but it’s a big deal to get it right.”