Downtown improvement funds remain intact after concern of transfer

With a joint meeting still pending with the Sarasota City Commission to discuss a transfer of $400,000 from its budget, the city’s Downtown Improvement District Board of Directors learned last week that its bank account balance was not as grim as it originally seemed.

The dominant agenda item at last week’s DID board meeting was a post-mortem of Chair Eileen Hampshire’s Aug. 15 appearance before the commission, during which she said City Manager Marlon Brown, in an unannounced transfer, moved to city coffers $400,000 for the future Main Street complete street project.

The DID had approved the future expenditure but didn’t expect the money to be removed until it was needed. Brown explained to commissioners that the $400,000 is show money to demonstrate that the city has “skin in the game” as it applies for state and federal grant funding for the project.

“I felt like I was grilled,” Hampshire said. “I asked for our $400,000 to be returned to us. There was a lot of pushback. The city manager said to me, 'What makes you think you can decide how to use that money anyway?'"

As a dependent special district in the state of Florida, the DID serves in an advisory capacity, in which it can plan expenditures within its defined boundaries using revenues from a special tax overlay district. Those expenditures are typically for a higher level of city services, improvements, maintenance, enhancements and special events — all for the benefit of commercial property owners and businesses within the taxing district.

However, expenditures of dependent special districts — such as the DID and the St. Armands Business Improvement District — are subject to approval of the city, which also holds veto power over their budgets.

In reality, the $400,000 remains available for use by the DID for approved budgeted items, it’s just not in the district’s own account. Hampshire complained to commissioners that the account balance was down to $8,000 following the transfer, but in the weeks since learned, via the machinations of municipal budgeting, the DID actually has more money.

Kelly Strickland, the city’s director of financial administration, explained non-allocated monies roll into reserves and don’t reside in the DID’s available funds account unless budgeted. The DID, she said, ended fiscal year 2019 with $790,000, and 2020 and 2021 with just more than $1 million, including the $400,000 in question.

“That $400,000 hasn’t gone out the door,” Strickland said, “and right now you’re sitting at $865,000.”

Still, the unannounced funds transfer doesn’t set well with the DID board, compounded by a removal of $150,000 earlier this year to help fund the Bay Runner, a free trolley service that runs between downtown and St. Armands and Lido keys.

When the DID objected to that, the city sent the money back to the DID, which then agreed to help fund the trolley with $50,000 a year for three years. That amount is matched by the St. Armands BID.

Julie Ryan, the DID’s business district manager, told board members the city is setting aside nearly $3 million, including the DID’s $400,000, from a variety of sources for the Main Street complete street project, which has yet to begin planning. The city intends to resubmit state and federal grant requests, which were denied last year, for the project.