Northport Appoints Developers To Lead University Beach Improvement District Board

NORTHPORT, AL — The Northport City Council on Monday voted 3-2 to create the University Beach Improvement District and also voted in favor of appointing a trio of developers and investors to head up its three-member Board of Directors.

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District 4's Jamie Dykes and District 5's Anwar Aiken were the two officials who voted against the creation of the Improvement District.

As Patch previously reported, the creation of the University Beach Improvement District for the proposed $350 million lagoon-style resort provides the developers with considerable latitude to build out what could in effect be viewed as a separate municipality, just based off of its capabilities.

Here's a look at the state law setting the regulations for Improvement Districts.

Attorney John Ray represents the city in these development matters and said the developers will now meet before coming back with a proposal for the city for the improvements they want to make. This would include an engineering report and then a methodology report to assess the financial benefits of the plans for the property.

The legal counsel for the developer also said these assessments would then possibly be used for future bond issuances, with the proceeds from the bonds being used for site development or infrastructure improvements.

As for the University Beach Improvement District's Board of Directors, the Northport City Council reportedly considered only three appointees, all of whom are closely involved on the developer side of the project: Texas developers Kent Donahue and John Hughes, along with investor Katie Le of San Marcos, California.

While the names were included in the official agenda packet published ahead of the meeting, they were not mentioned by their names at any point, including their appointment to the University Beach Improvement District Board of Directors.

Developers Donahue and Hughes were out front in pitching city leaders on the concept months ago, while City Hall sources tell Patch that Le is an investor for the project.

Former Northport Councilman Bart Harper, who lives on Harper Road and within the immediate footprint of the proposed project, asked how the resolution came to pass binding the city to the developers and the creation of the tax improvement district.

"This should not have to be explained by lawyers," Harper said to the Council when he did not receive an immediate answer from members of the council, who deferred to City Attorney Ron Davis.

It's worth noting that despite pushback, the Council was contractually obligated to create the special tax improvement district voted on Monday night, which was agreed upon in the initial public-private partnership agreement that the City Council voted to enter into with the University Beach developers in late February.

Lee Boozer, a former councilman who says he lives within 200 yards of the beach project, questioned problems with the nearby creek and how the developers plan on getting the water for the massive project. He also wondered if the area in question was a floodplain.

"I don't think this Council did its due diligence before all this came up," Boozer said. "I believe about half of what I hear but I do think that there were some bad choices made. If it were in a larger area, I thought the water park was a great idea."

Tuffy Holland, a Northport resident who is the plaintiff in an ongoing civil suit against the City of Northport over public records connected to the project, doubled down on the lack of transparency and once again demanded the public be provided studies that have been carried out on the financial end and potential environmental impacts.

Holland insisted the city has yet to provide such studies and his civil suit remains active.

"There's just no transparency and we just want to know stuff," Holland said, referring to those gathered in the audience for the meeting. "We feel like we've been left out, put in the dark, we've got all these things happening to us and this particular one we have absolutely no control over. ...

"You hide behind a lawsuit and that's what you're doing," Holland added. "You're just using [the lawsuit] as a shroud. It's not going to make any difference in the long run."

The City Council will now have to vote at a later date on the formation of a Cooperative Improvement District that will be tasked with managing the city's flow of sales and lodging taxes for the property, with the agreement providing the developer up to $61,058,171 or paid out until the 30-year term established in the agreement is reached, whichever comes first.

The project remains a contentious one not just for those living in its proposed footprint but those in the surrounding area and those concerned with the city's finances being wrapped up in such a major project.

Indeed, the city has agreed to commit no more than $20 million to the first phase of the project, mostly in the form of infrastructure and site work, while the developer is committed to securing at least $63 million in private investment for the project's first phase.

Ray said that in the event the developer fails to perform or follow through on the project, the city will get the 11.5 acres of land back that it originally deeded to the developers, other than what was there when the city conveyed the land to them.

He called this an "essential" part of the agreement for the city before the Council opted to enter the deal with the developers.

Ahead of the vote, District 4 Councilwoman Jamie Dykes questioned the authority given to the developers through the creation of the Improvement District.

Ray's response then drew laughs from those in the audience after he was asked if the developers would have the ability to build schools and other public-styled amenities within its footprint like a city within a city.

"There's no doubt that the power given to improvement districts is broad," Ray said, conceding to the possibility. "It's spelled out in the (Alabama) code."

Phase one will include the proposed lagoon and its amenities, while phase two will consist of a hotel and other hospitality offerings.

No timetable has been given for when the City Council will vote on the creation of the Cooperative Improvement District.

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