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Government What’s next for Panther Island partners?

What’s next for Panther Island partners?

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Major changes could be ahead as the government agencies partnering in development of the $1.17 billion Panther Island project seek solutions to attract critical federal funding.

A restructuring within the Trinity River Vision Authority, the oversight agency for the project, is already under consideration as the TRVA board implements a consultant’s recommendations for improvements.

Whether that results in personnel changes as well as reorganizing administrative functions and shifting responsibilities among the partnering agencies remains to be seen.

Then there is still the possibility that a cost-benefit analysis would need to be done to satisfy official rules of the U.S. Army Corps of Engineers, the federal agency that would build the bypass channel on the Trinity River north of downtown Fort Worth. The channel would improve flood control protection and carve out a center island that would be known as Panther Island.

Years ago, an economic impact study of the project was conducted by the University of North Texas.

“We didn’t do a Corps-certified cost-benefit study,” said Fort Worth City Manager David Cooke, who is also a member of the TRVA board.

Nevertheless, the Corps authorized up to $526 million to be spent on the project in 2016. Officials of the TRVA, and its parent agency, the Tarrant Regional Water District said the Corps waived the requirement for the cost-benefit analysis for the project.

But now Cooke and others question whether the optics of following official Corps protocol may be partially to blame for the project’s failure to attract federal funds for several years in a row.

“That’s what the Corps said is necessary in order to be a Corps-approved project,” Cooke said.

So far, the project has only received about $60 million from the federal government. No money has been appropriated for the project under the Trump administration.

Yet, local partners, which also include Tarrant County and the city of Fort Worth, are committed to the project, which has been championed since the beginning by U.S. Rep. Kay Granger, R-Fort Worth. Granger’s son, J. D. Granger, is executive director of the TRVA, a fact that project detractors say may have hindered federal funding for the project along with the lack of a Corps-approved cost-benefit analysis.

Both the TRWD and the TRWD boards have adopted a $36.6 million budget for 2020 to keep the Panther Island project on track. Yet, there is only about $7 million left from a $200 million TRWD loan to TRVA for project. Local partners have already invested nearly $326 million in the project.

With the coffers dwindling, the boards and leaders of the TRVA and TRWD are scrambling in different directions to find solutions to keep progress moving.

Among its steps, the TRVA board hired Dallas-based consulting firm Riveron to conduct a comprehensive review with the intention of helping better position the project for federal funding.

Recommendations include administrative restructuring, improved communication and transparency about the project and messaging focused solely on flood control absent of economic development.

The consultants said economic development opportunities are typically secondary benefits of major capital improvements projects such as this rather than direct benefits.

In the meantime, various leaders with the partner agencies have met with federal officials in the Office of Management and Budget to plead their cases for funding for the project.

Mayor Betsy Price was among the first to do so last fall. After her meeting, she called for the comprehensive review.

In July, Price and Republican U.S. Rep. Roger Williams, whose District 25 stretches from the southern Fort Worth area to the Austin area, met with Mick Mulvaney, the White House budget director and Trump’s acting chief of staff.

The two walked away from that meeting hopeful that Panther Island could receive up to $250 million for flood control improvements, although there is still no guarantee or timeframe for receipt of the funds,

TRVA board President G. K. Maenius, who is also administrator of Tarrant County, has also met with a federal official and corresponded with Russell Vought, acting director of the Office of Management and Budget (OMB).

“As we complete the three bridges that will span this critical flood control project, there is now an urgent need for the USACE to continue its planning and design effort to begin construction of the core bypass channel,” Maenius told Vought. He asked the OMB to approve $36.7 million for 2020 and $38.7 million for 2021.

Granger, the ranking Republican on the U.S. House Appropriations Committee, and other top TRWD officials also reportedly met with OMB officials to make a case for Panther Island funding.

Should federal funds fail to be appropriated again, TRWD officials’ backup plan is to begin issuing $250 million in general obligation bonds that voters approved in a 2018 election.

But a caveat to bond issue is raising the repayment ceiling a of tax-increment-financing (TIF) district – a funding source for Panther Island – from 40 to 50 years. Only the Fort Worth City Council has authority to raise the ceiling but has yet to consider doing so.

Cooke has balked at extending the TIF, identifying the situation as a “Catch-22” or even a chicken-and-egg scenario.

Originally, the plan was to pay for the TRWD to “cash-flow” the construction process with oil and gas royalty funds, Cooke said. When that revenue stream dried up, the TRWD asked voters for a bond issue.

But raising the TIF comes with inherent risk for the city, Cooke said. The financing arrangement is complex and the only way the bond debt is going to be repaid is through recapture of tax revenues from the TIF.

But it takes development within the TIF district to generate tax revenue, he said.

So, the city and other partners have to weigh whether the federal funds will be appropriated to dig the channel, which in turn will establish the island and stimulate more taxable development, Cooke said.

To prepare for the Corps to dig the channel, the city must “size-up” and relocate the utilities at a cost of about $80 million, Cooke said.

“A lot of things are tied together, and I think the city, frankly, our leverage is really with the extension of the TIF,” he said. “We’re not saying that we won’t extend the TIF, but we want to make sure these other things are going to fall in place, too, like the federal funding.”

Since the TRWD has made an official request that the council consider extending the TIF, Cooke said he would place the issue on the council agenda, probably sometime after Oct. 15. A presentation by the Riveron consultants is also being planned.

Regardless of whether the TIF is extended, the city will spend $13 million on utility work, Cooke said.

“We currently have an agreement that, when we go ahead and do those projects and they are completed the (TRWD) pays us back,” Cooke said. “There’s a written agreement that says that’s how we’ll handle it.”

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