October 30, 2014

North Central Region

John M. Dunn | 4/1/2001
Gainesville: Turf Tussles

The University of Florida is the state's biggest generator of traffic jams north of Disney," says Bruce DeLaney, assistant vice president for administration real estate for the UF Foundation. Every day 60,000 people -- students, staff and hospital workers -- converge in Gainesville.

This happens because the university lies at the center of Gainesville. But UF is also the area's economic core. According to a new UF report, it delivers an estimated $3.2-billion annual impact to the state. In addition, the university just concluded a five-year, record-setting $850.4-million fund-raiser.

UF "drives economics and politics. It has progressive, democratic ideas about how growth management ought to be, and that puts it at odds with most of the nine municipalities that ring the city," says Alachua County Commissioner Mike Byerly.

Though this progressive ethic is shared by many Gainesville officials, the city and county governments are at odds over a burning issue in this part of North Central Florida -- annexation. A decade ago, the state adopted the Boundary Adjustment Act, designed to curb Gainesville's passion for annexation. This, however, caused new problems over the years that resulted in bitter turf wars.

Most recently, Gainesville and county officials have clashed over who should govern the growing urbanized areas on the outskirts of Gainesville. Despite county concerns, the city favors annexation, believing residents in these areas don't pay their fair share for the services they use when they come to town. Gainesville officials also argue that the city can deliver services more efficiently. As Heidi Lannon, the strategic planner for Gainesville, points out, "Under the state revenue-sharing system, we get more money per resident than the county gets for unincorporated areas."

Though many rural landowners outside Gainesville dislike its annexation policies, they also resent the county's restrictive growth-management plans. That's why many keep asking the more lenient small cities nearby -- which also have lower millage rates than the county's -- to annex them. As a result, these municipalities have annexed so much land in recent years that "Gainesville is now Alachua County's third-largest city in land size after the city of Alachua and Newberry," says Lannon, "even though the Gainesville urban area has the biggest population, with 160,000."

Not all Gainesville's neighbors are growth-happy. Talk is under way in Micanopy, for example, about annexing a green barrier to keep out growth.

A truce of sorts may be shaping up. Officials from all the municipalities and the county met in Gainesville recently and vowed to resolve their problems. But their differing philosophies may make this tough.

People to Watch
Jane Burman-Holtom was last year's U.S. Small Business Administration's "Small Business Advocate of the Year" for Florida. President of Gainesville business consulting firm JBH & Associates, Burman-Holtom was honored for her pro bono work. When not tending to paying clients, she offers free advice on marketing, strategic planning and website design to "people who don't have money" for such things.

Computer analyst and activist Susan Wright was "shocked" when she ran a statistical analysis of the 2000 Alachua County Commission race campaign contributions. Corporations gave about 26.6% of the total funds to candidates, she says. Worse yet, the lion's share comes in during the last two weeks of a campaign, making it tough to track the money flow until an election is over, she says. Her Alachua County Citizens for Campaign Reform is trying to persuade state legislators to give county commissioners the authority to hold a referendum on local campaign funding reform. "If other voters saw what I saw on those printouts, they'd be appalled too," she says.

Businesses to Watch
In 1994, two UF students, Manoj "Marty" Puranik and Jose Sanchez, started a computer business. Two years later, they moved into internet services. Today their company, Atlantic.Net, does business in seven states, employs 80 and expects to double that number. The company's new focus is on "high-speed business services," says human resources manager Karin Hyler. "Residential dial-up is not the
future."

The Gainesville Sun, guided by a new publisher, Jim Doughton from Sarasota, is seeking new alliances with electronic media companies. The newspaper just bought the rights to the website name Gainesville.com. This spring, the company will open a "regional portal" on the
internet.

Key Statistic
Construction projects at the University of Florida totaled almost $39 million in 1999-2000, about half of the total of 1996-1997 activity.
Ocala: Paying the Piper

Nobody ever gets away with passing a tax here in Ocala," growls Mitzi Perry, executive director of the Marion County Builders Association. "So they impose an impact tax on us!"

Perry has a point. With the exceptions of a "Pennies for Parks" tax plan and a sales tax on gas, Ocala-area voters have scuttled every tax proposal they could since 1988. They nixed a property tax designed to help the public library keep up with growth. A half-cent sales tax for schools also went down. Voters even refused to pass a "bed tax" on visitors -- three times. Most recently, in 1998, they said no to a road-improvement tax.

And now, to the chagrin of Perry and her fellow builders, county commissioners unveiled a plan that would double local impact fees to pay for growth. "It's not fair; it's not equitable," she complains.

Perhaps so, but impact fees raise much-needed funds. And they underscore a vexing problem in Ocala: Who should pay for growth?

Ocala has done a very good job keeping up with water and sewerage, says Paul Nugent, Ocala's assistant city manager, "but we cannot keep up with the costs of roads." For one thing, he says, landowners are able to demand more money for their land these days when the city needs to buy rights-of-way. "It's getting to the point that the right-of-way costs are as much or exceed those of road construction," Nugent points out. "Ten years ago that wasn't the case."

Ocala's transportation needs, however, pale in comparison to those of Marion County, which needs $382.8 million. Congested State Road 200, connecting Ocala with a slew of residential developments west of town, is in desperate need. But neither the city nor the county is willing to pay for six-laning the road. So others volunteered to help pay. "We stepped up to the plate, along with two other developers -- the Fore Family and the Morgran Co. -- to put up $3.78 million to pay for half of the road construction," says Larry Bush, marketing and public relations director for Ocala Regional Hospital, which plans to build a full-service hospital with surgical beds and an emergency room on SR 200.

Morgran hopes to build a shopping center, and the Fores plan a pharmacy nearby. A grant from the Florida Department of Transportation will cover the other 50% of construction costs.

Ocala may not be so lucky in the future, especially if Gov. Jeb Bush pushes through his electric deregulation plans. Currently, about 43%, or $15.6 million, of Ocala's general fund revenue comes from its electric utility. But if the city's big consumers are ever able to turn elsewhere for cheaper electricity, Ocalans may have to make up the loss in revenues with something they clearly abhor -- higher taxes.

People to Watch
Not long ago, former Assistant City Manager Janet Tutt used Ocala's utility-generated funds earmarked for economic development to lure several companies to town. She also successfully campaigned to get Ocala christened an "All American City." More recently, as assistant county administrator, Tutt helped to broker the private/public SR 200 partnership to widen the road and several other deals.

Three years ago, 24-year-old David Hebel started Digital Juice, a computer-animation company, in his bedroom in Erie, Pa. Soon the whole family joined his enterprise. Today in Ocala, Hebel's company employs 22 and produces animation for the likes of David Letterman, CBS, Fox, ESPN and the Grammy Awards. Says Jim Hebel, partner and father of the young entrepreneur, "Last year, we did $2.5 million in sales" -- a 300% increase over the prior year's sales. Hebel's animators recently moved to a bigger building in Ocala.

Business to Watch
With more than $3.2 million in state and federal grants, Overhill Farms, a California-based food processor, plans to open shop in Ocala. The project calls for the city first to use some of the funds to clean up a "brownfield" property for a parking lot and to demolish an Ocala eyesore -- a former meat-packaging plant recently used as a set for a horror film. Next, Overhill expects to rehabilitate a separate 68,000-sq.-ft. facility next door for its operations, creating 189 jobs and possibly an additional 170 in four years.

Key Statistic
With $5.9 billion in total personal income in 2000, the Ocala metro area (which includes all of Marion County) led the North Central region. But its per-capita personal income of $23,488 was second to Alachua, with $27,208.
County Outlook

Alachua, Bradford, Putnam
Alachua County's low unemployment, 2.2%, continues to mask its chronic "underemployment" problems. Simply put, the county has an abundance of skilled people who can't find appropriate work. The Council for Economic Outreach is trying to assist by raising $3 million to promote job creation.

Meanwhile, some help has arrived for lower-wage workers. The newly opened Dollar General distribution center hired 435, and a Nordstrom distribution center is also up and running with 50 new jobs.

Neighboring Bradford County is attracting some growth, but not the kind it wants. "Many of the people who moved into the area work in Gainesville or Duval County," says John Miller, editor of the 122-year-old Bradford County Telegraph. "It's not the kind of growth we wanted."

In Putnam, prospects are more promising. Lafarge Gypsum opened a plant and created 100 jobs. An $8.5-million expansion at PDM Bridge means 65 new hires, and Georgia-Pacific is expanding.

Business to Watch
The big news in Putnam is the arrival of Sykes Enterprises, with its $4-million call center. The Tampa-based company intends to employ 400.
Levy, Marion, Sumter
"We have triple the number of banks we had 10 years ago," says Michael Malone, president and CEO of the Ocala-Marion County Chamber of Commerce. The area has more than 20 different banking institutions and 15 investment firms. The financial presence, combined with a growing shortage of doctors and nurses, reflects the continued impact of retirees. The growth is also creating problems. USA Today listed Ocala-Marion County as the nation's worst on its urban sprawl index for cities with fewer than 250,000 people.

Neighboring Sumter is also experiencing a retirement boom. "We expect little old Sumter County to double in the next 10 years, primarily with retiree markets," says Greg Stubbs, the county's planning and development director. The biggest of these is The Villages, a sprawling, upscale community development district that has plans to add another 11,097 homes.

Prisoners also continue to boost growth in Sumter. David Honsted of the Federal Corrections Complex says the facility has 380 job openings.

In coastal Levy County, meanwhile, locals are getting serious about eco-tourism. They now have a new Nature Coast Business Development Council. Plus, Levy joined forces with Dixie and Gilchrist counties to foster tourist development.

A state grant is helping Fanning Springs to spruce up a stretch of the Nature Coast Trail and create a historical park. In addition, a $2-million grant will let Yankeetown buy two islands to create canoe trails.

Person to Watch
Carol McQueen, mayor of Fanning Springs, has been busy collecting grant money to burnish her city's presence in the eco-tourist trade. McQueen is seeking a rustic land bridge to assist hikers across U.S. Highway 19 near Fanning Springs.

Business to Watch
Biomass wants to recycle Levy's waste from dairy farms and timber production into animal food and other products. Says Krista Kelly, Levy County's planning director: The $6-million to $8-million project "reflects the focus and character of how we want our county to develop."
Regional statistics, including population, income and labor information, are included in the print edition only. To order a print copy of the April issue, call (727) 821-5800. To subscribe to Florida Trend online, click here.

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