Note: This story has been updated with additional comments from the transcript to clarify Stephanie Lynch’s remarks about the project’s community benefits. The comments had been edited due to story length.
It was a month ago this week that the biggest economic development proposal in the history of Richmond was stopped in its tracks by a divided vote of City Council, bringing an end to the $1.5 billion project known as Navy Hill.
By all accounts, the redevelopment project that would have replaced the Richmond Coliseum and invigorated other city-owned land beside it is in fact dead, as Mayor Levar Stoney declared in a Q&A with BizSense in the week that followed the vote.
In the time since, council has pressed forward with the first steps of a plan to solicit more community input, appraise the land and put out a new request for proposals to revitalize the area – with or without a new arena.
The city also has received an offer from another developer proposing an alternate project that it says would not require a public funding component, as Navy Hill had through a proposed tax-increment financing (TIF) district that the council majority cited in their votes to kill the project.
BizSense sat down with two of those councilmembers – Kristen Larson of the Fourth District and Stephanie Lynch of the Fifth District – to discuss the reasons behind their votes, their thoughts on the project and process in retrospect, and how they see the city moving forward with the site. The following is an edited transcript:
Richmond BizSense: Kristen, you mentioned while we were sitting down for this interview a sense of relief that Navy Hill is behind you. Having led the push to vote it down, is there also a sense of accomplishment?
Larson: I don’t know if it was so much a feeling of accomplishment, but I think there was a point in the process where I felt like we couldn’t continue down this path, because from my perspective, I didn’t feel like there were amendments that could be made to fix it in a way that made the deal palatable for me to vote for it.
We had invested a ton of time and resources, so you do get to a point in the legislative process where you need to decide, are we going to continue to invest all these hours, all these resources, all these staff folks, me investing my time with constituents on this topic? Or are we going to say, “Hey guys, we can’t work with this plan anymore, it’s time to hit the reset button.” That’s where I got to, and that’s why I put my name on the resolution.
RBS: Stephanie, you campaigned (in a special election last fall to fill Parker Agelasto’s former seat) on a promise to vote against the project. What had made up your mind even before becoming an active council member and talking with the parties involved?
Lynch: Everyone in that race did, all eight of us. It was not something I ran on; it was something that I had to talk about, because it was one of the top three building issues in my district as the election and this Navy Hill deal came to a boil.
There were three things that I found to be egregious about the deal. Of course, the 80-block TIF, which would have held hostage 80 square blocks of downtown for the foreseeable future, 30-35 years, was I think in some ways running contrary to the promises that we had made citizens, which were: fix our schools first. Fixing our schools should be our No. 1 economic development priority. Why? Because our higher-income earners leave this city when their kids hit middle school, and we don’t get their taxes back.
Secondly, I think some of the community benefits that were being touted in this deal were hard for me to swallow, and some of the hope that was being sold that this was a project that was going to solve affordable housing in Richmond, it was going to solve poverty for the African-American community. It was a very dangerous line, and for me as a former social worker, was offensive to some of the communities that I had worked with and served in my previous role, to tout this project as a solvent for all of Richmond’s social ills, when in fact it was an economic development deal that likely would have accelerated the gentrification of this city.
The third piece that to me just didn’t make sense was the fact that we were putting up $600 million over the lifetime of 30 years, that’s three generations of schoolchildren, for a brand-new shiny 17,500-seat arena that’s 2,000 seats shy of Madison Square Garden. I don’t know that that was necessarily thought through. But possibly more ostentatious of a situation is the fact that no one bothered to ask the citizens of Richmond, “Hey, we’re putting up this much public funding; do you guys want a brand-new shiny 17,500-seat arena?”
RBS: There was an argument out there at the time of the vote that it sends a bad message to businesses looking to invest in Richmond.
Lynch: I think that was a message of convenience that served to justify this deal and this proposal. There was a huge grassroots advocacy effort through the small business community, through the corporate business community, and they were used and leveraged to believe that this proposal equated to the economic success of Richmond, which was false.
I will tell you now that Richmond is open for business, we are a City Council that wants to grow, that understands the importance of economic development, that wants to complete and succeed in the core functions of our local government through economic development. But to say that by saying no to this deal we’re saying no to business, that’s a false dichotomy, and quite frankly it’s a terrible message for anyone in our city to promote.
RBS: The ordinance spells out what steps you want taken, but what do you want to see in terms of a timeframe for this new RFP process?
Larson: I think there is a sense of the sooner the better, and the council president asked numerous times for the administration to put together a timeline. The two most immediate things are the appraisal and the community meetings. I suggested, and we talk about it in our resolution, using Richmond 300, because this portion of the city was left out of the Richmond 300 master plan planning process.
They already have the setup, the tools in place to do these outreach meetings, so I don’t see any reason why they can’t immediately put this on their schedule and push those meetings out over the next four or five weeks and get folks’ input and be able to break it down in a way that incorporates it into that plan. And at the same time, we can be doing those appraisals and finding out the value of that land.
RBS: Do you feel that the Navy Hill saga essentially provided that feedback and input from the community? What more needs to be said?
Larson: Yes, through the public input and everything, I think we have gotten a lot of that. I don’t think we need six months of meetings; I think we need a couple meetings just to codify it and make sure it’s in a way that we’re all looking at the same thing.
Lynch: And it boils back down to that main question: do we want to be an arena city or not? Particularly if we are looking at a bright new shiny arena, we are going to be hard-pressed to find a developer that’s just going to hand over that investment without some kind of public subsidy.
As you are aware, we have received an unsolicited bid, which calls for the retrofitting and rehab of our current Coliseum, that involves absolutely no public subsidy whatsoever. But if the public decides they want a brand-new shiny arena, then it’s likely that we will have to do some type of subsidy for that. But that question has to be asked of the public first.
RBS: You mentioned Douglas Development’s offer. What are your initial thoughts on it, or are you waiting for it to go through the RFP process?
Larson: My understanding is that an unsolicited offer triggers the RFP process, because it opens the door and allows other bids to come in. I think that coming in two weeks after the vote shows that the development community has not been scared away and there are folks out there that are interested.
I do think that folks realize that the first RFP that was put out there was very narrowly written and the timeframe was really short for what they were asking for, so I think that putting an RFP out on the street that is much more open, allows folks ample time to respond to the requirements of the RFP, I think we’re going to see something different.
RBS: In our Q&A with Mayor Stoney after the vote, he said he needs council “to act in good faith” if the city is going to accomplish large-scale projects like Navy Hill. How did you read that?
Larson: Inferring that we weren’t acting in good faith, I always act in good faith. The reality was we had one proposal for an RFP, and while slight changes could have been made to that plan, the entire plan was built around this huge arena that was very expensive and being funded by taxpayer dollars.
From where I sit, I’ve worked through the process and I’ve read the documents and I participated in all the workshops and got all the information the same time I’m talking to my constituents, and all of that was in good faith. But it did get to a point where I was like, we cannot make this right. And the amounts we’re investing and the land that we’re giving away and the return on that investment, it does not make sense for me.
Lynch: The message that is out there to the business community, and I want to set this straight, is that we turned down $1 billion, that we turned down an arena, that we turned down the possibility to generate $1.1 billion of revenue that would have been generated from the businesses, and that we turned down $300 million of minority business enterprise. If you just have those four talking points out there, that does make us look like irresponsible oppositionists, and that’s what the majority of folks who didn’t look into the deal really thought, because that’s what was put out there in the media.
If you peel back the onion on that, what we actually turned down was holding ourselves hostage to 80 square blocks and an unforeseen return-on-investment timeline; we turned down a lot of question marks that still had not been determined on the interest rate on those bonds and the mechanics behind how those would be paid off.
I want folks to know that there was more behind this deal than what was put out in talking points in the media and by the Navy Hill development corps. I think this notion that we are a dysfunctional body, that we turned down economic development, is a false narrative that served a purpose, but it is not necessarily the facts or the truth.