Last week, city officials told the Ocala Chamber and Economic Partnership to revise and reduce a $190,000 contract for “business services” that has been rubber-stamped for over a decade, saying they would not approve the amount after the chamber went against the city’s wishes and supported a rail project that will dramatically impact traffic in downtown.
On Tuesday, November 5, Ocala City Council members directed the Ocala Metro Chamber and Economic Partnership to revise its contract for “business creation, retention, and attraction services” with the city after a lengthy discussion over the $190,000 agreement.
According to a city staff report, the CEP first requested $190,000 in 2012 for the same services. Since then, there has been an agreement in each subsequent year to fund the same amount.
In total, the city has given more than $2,280,000 to the CEP in just these contributions over the past decade.
During Tuesday’s meeting, Councilmember Jay Musleh suggested that the city’s contribution total was significantly higher.
“I’m a huge supporter of the CEP. I think they’ve done a fabulous job for the city. However, I think it’s time for us to rethink how we move forward. $190,000 a year, to me, is too big a scope for what we’re doing now,” said Musleh, who joined the council right around the same time that the chamber was formed.
Musleh said he believed at the time, the city’s financial involvement would be limited to two or three years and that the contributions would stop once the CEP could “stand on its own.”
“I think they can stand on their own. I’ve looked at their financials. I think they’re perfectly capable of standing on their own,” said Musleh.
According to the Ocala CEP website, the organization currently generates between $1,642,500 and $3,185,000 from its top 339 memberships.
That includes eight “Founder’s Level” companies or groups that pay over $35,000 each, as well as 20 “Chairman’s Circle” organizations that pay between $20,000 and $35,000 each for their memberships.
The top memberships are separate from the base membership for the CEP, which is $600. Although it is unclear how many businesses pay base membership, that total would be in addition to revenue generated from the top memberships.
“I think it’s time for us to take a sponsorship level at more of what our corporate people are doing, and bypass this $190,000,” said Musleh. He went on to say that, including the “in-kind” contributions in rent breaks, the city has given the CEP over $6,350,000 over the last 12 years.
Musleh opened his comments on Tuesday by establishing concern over the chamber’s alignment with city objectives. He said that the council, and city, had openly expressed opposition to a rail project that was green-lighted by county commissioners to increase rail traffic through Union Station.
Musleh said when the chamber discussed and “endorsed” the project, there was no consideration given to the city’s position.
“There was never one discussion brought up about any impact that this would have on the city of Ocala,” said Musleh. “I perceive it to be a negative impact.”
Musleh, who had sought to have the rail designated as a walking trail, said he understood that his desire was a long-shot, but was shocked at the chamber’s support to increase railway traffic by “2 or 300 percent.” He went on to say that additional traffic from tractor-trailers will cause more traffic in an area that’s already “overburdened.”
“I agree, we need jobs. Is that the best use of this facility? The best placement of it? I don’t think so, and certainly, I think the increase in train traffic, how that’s going to impact our regular vehicle traffic, through the city of Ocala, it’s going to leave a lot to be desired,” said Musleh.
He wrapped his first set of comments by suggesting that he would not support the measure.
“When their goals don’t align with our goals, and we don’t even get a voice at the table to say ‘hey, could you have done something to mitigate it?’ Nothing. I cannot support this and will not support it,” said Musleh.
Despite the rest of the council all agreeing that the CEP “does a lot” for the city, councilmembers Kristen Dreyer, Jim Hilty and Ire Bethea all agreed that the contract needed to be revised, with Dreyer suggesting the need for better “definitions.”
During the discussion, CEP President and CEO Kevin Sheilley was asked to address several of the points brought up by Musleh. Sheilley said the city’s position on the rail was never made public or discussed during a meeting. He emphasized that the CEP was strong supporters of downtown, but that “CSX said they had no intentions of abandoning” the rail.
Sheilley said the CEP works with “the reality” that it has, and that there are other cities around the country, including Savannah, Georgia, that have operational rails operating regularly.
After additional discussion, during which Musleh suggested the city could no longer approve a “blank check,” Sheilley recommended that the agreement return to staff to work out something beneficial for both the city and the CEP.
According to city staff, the agreement will be revised in hopes of presenting it to the council in early December.
