Port Richey considers shrinking its redevelopment zone to satisfy audit criticism

PORT RICHEY — Stung by a critical review of its operations by the state’s auditor general, the Port Richey Community Redevelopment Agency is considering shrinking its redevelopment zone and establishing a more transparent way to track its ongoing projects that take place inside of it.

Its leaders also have begun talking with Pasco County officials to resolve several financial issues.

Scott Tremblay, mayor of Port Richey, recommended on Tuesday that the agency drop another waterfront community from its boundaries. In this case, he said that carving out Harbor Isles from the redevelopment boundaries could solve many of the audit concerns.

In the 37-page report, the auditor found 15 deficiencies in the Port Richey agency. Those included having the entire city within the redevelopment zone boundaries and paying for city salaries, including police, fire and city council members, with money from the agency. Such payment of general government expenses is not allowed by law, the auditor concluded. Money from the agency is meant to fix up blighted areas.

Having the entire city within the redevelopment agency boundaries is a problem, according to the audit. The agency is funded by the tax revenue that comes from rising property values in the zone. Having the entire city included means that all property value increases go to the agency for the redevelopment projects and not to the city, which pays normal government expenses.

After strong criticism last year by county commissioners over another high-end waterfront community, Harborpointe, being included within the agency boundaries, the city opted to cut that area out.

Tremblay said that the salary costs can be backed out of the agency budget for the upcoming budget year and come instead from the city budget if the city drops Harbor Isles from the redevelopment district. That decision would lower the city’s contribution to the redevelopment agency to about $450,000, compared to roughly $650,000 paid in 2021, Tremblay said.

“You’d kill three or four birds with just one stone by adjusting the boundaries,” he said, adding that county officials also liked the idea.

Since the county also contributes county tax revenue increases to the city’s redevelopment agency, removing an area also cuts down the county’s fiscal responsibility to Port Richey. Tremblay said that with the city and the county each giving about $450,000 to Port Richey redevelopment next fiscal year, that would be enough to get projects done.

Agency board member Todd Maklary asked whether the city should also look at another upscale community for removal, Sand Pebble Pointe. But Tremblay said that removing both of the neighborhoods would bring the redevelopment fund revenue down too low, to about $100,000 per year.

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Community redevelopment agency board members agreed to talk more about altering boundaries. They also heard from City Manager John Dudte that talks with county officials to resolve other issues had begun.

The city is also updating and putting its redevelopment project list on its web site and is creating a policy manual, guidelines for documenting how much time city employees spend on redevelopment agency business and new job descriptions to make sure that other points made by the auditor are addressed.

Maklary said he was glad to see that city staff was planning regular updates on their progress on the various issues.

“It shows everyone that we’re addressing this. We’re not fighting it,” he said. “We find the audit useful and we’re trying to correct all of these issues.”