Pensacola, Florida
Friday July 19th 2019

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Mayor Completes Titan Deal

By Jeremy Morrison

It was a rough touch down, but it appears that Pensacola Mayor Grover Robinson has landed the city’s Project Titan, a $210 million jobs and infrastructure project at the Pensacola International Airport.

The project—years in the making and already underway—involves constructing four hangars and associated facilities at the airport to accommodate maintenance, repair and overhaul operations for the aerospace industry, specifically for ST Engineering, the existing hangar’s tenant that has promised to create hundreds of jobs and participate in training programs. The project relies heavily on funds stemming from environmental penalties related to the 2010 oil spill, but that money hinges on the city’s ability to piece together the remaining funds.

The decisive, if awkward, moment for Project Titan came Feb. 8 as Mayor Robinson appeared before Triumph Gulf Coast board members, who had already committed a crucial $56 million toward the project, to ask for a little bit more money. If Triumph balked, the project could fall apart.

“We’re still going to be short some,” Robinson told them.

This was not good news. But a spirited scolding notwithstanding, everyone understood no one was going to let a few-million-dollar deficit hold up a project being touted by proponents as a generational game-changer and potentially a catalyst for an entire industry.

“We’ve been to the well a couple of times on this thing,” board member Allan Bense told Robinson through a half-nice smile before Triumph ponied up the dollars needed to push the project forward. “I don’t want to see you here again.”

Whittling a Shortfall
When Mayor Robinson came into office last fall, he found a surprise awaiting—the city was about $45 million short on its share of funding for Project Titan.

“Last October, we thought this was over the line and finished,” Robinson told the Pensacola City Council a few days before his appearance before Triumph.

For the last few months, the city administration has worked to secure the needed funds, seeking commitments from the state, specifically $20 million more from the Florida Department of Transportation, about which it feels “it is reasonable to be optimistic.” And during the first week of February, Robinson made the rounds locally, hitting up the Pensacola City Council and Escambia County Board of County Commissioners for $5 million respectively.

“We certainly have very large requests,” Robinson acknowledged to city council members.

The mayor seemed to be pursuing Titan funding with increasing urgency. He was already working off a deadline extension from Triumph, and now he said that ST Aerospace needed assurances the project’s funding would indeed materialize and was pointing toward a Valentine Day company meeting as a make-or-break date.

“Big time,” confirmed Bill Hafner, president of VT MAE, a subsidiary of ST, standing in the lobby outside the Escambia County Commission chambers. “We’re on a tight timeline.”

Hafner explained that the company was looking to take on a big contract, the kind that only comes along “every five years” and the kind that would require additional facilities. If more hangars weren’t going to be funded in Pensacola, ST would have to rethink its operational plan.

“It’s a key factor,” Hafner said. “Obviously, if you don’t have the capacity, they’re not going to consider you.”

If Titan fell apart due to funding, it would be a big deal beyond causing ST to reassess. It would dash the hopes of establishing a foothold in the aerospace manufacturing industry, as well as the jobs and training programs associated with ST’s presence and expansion, not to mention all the increased tax revenue and projected ripple-effect benefits attached to such a project.

Mayor Robinson found fairly receptive audiences to this line of thinking in the city council and county commission, receptive enough, anyway.

“We’re really talking about the future of Pensacola,” Councilman P.C. Wu said before the council kicked in its $5 million.

“If anyone wants to run down this project, they’re missing the big picture,” said Escambia County Commissioner Jeff Bergosh.

Titan Holdouts
But not everyone agreed that committing so much money to Project Titan was a great idea. There were some concerns about publicly funding a project that benefitted private industry and questions about the rosy economic benefit projections being laid out before officials.

“I think it’s too much money,” said Councilwoman Sherri Myers, citing a letter from former City Budget Analyst Butch Hansen warning of “significant financial risk” for the city.

Robinson, in fact, only narrowly secured his recent $5 million request from the city council, with three of its seven members refusing to support the commitment. The county commissioners were more vocal in their support, with only one holdout among the board, an outcome Bergosh had predicted.

“I think it’s going to be a 4-1 vote at the end of the night, and it’s going to be a great thing,” Bergosh said, downplaying Commissioner Doug Underhill’s concerns about Titan.

But Underhill—as well as council members Ann Hill, Jared Moore and Myers—were expressing fairly textbook concerns about such a project. They feared that putting so much money into the project would drain resources away from other obligations and that the cost per job was simply too high.

“I’m tired of telling citizens no to things like streetlights, sidewalks and safe roads and saying yes to things like this,” Underhill said.

Several city council members also expressed philosophical reservations about incentivizing private industry with public dollars. Others countered with examples of successfully incentivized industries in neighboring regions.

“Do I like incentivizing?” Councilwoman Jewel Cannada-Wynn asked rhetorically. “It is the name of the game in some places.”

“Ladies and gentlemen,” Wu told his fellow council members, “Mobile hasn’t grown the way it did because they didn’t provide any incentives.”

Triumph’s Last Gift
With a fresh $10 million in hand and a new cartoon in the daily paper lampooning the mayor’s frantic hunt for funds, Robinson headed off to see the Triumph board with an ambitious ask for another $12.5 million in funding. A rejection of the request would also mean the original $56 million would be revoked, which would sink the project.

“I don’t think any of us likes the way this feels,” said Triumph board member Benjamin Lee.

Ultimately, Triumph agreed to commit $10 million more to Titan but threw in some additional stipulations on the funds. In return for the additional funds, Robinson agreed to work on a deal with ST Aerospace that saw its training and jobs benefits spread across Northwest Florida and also tethered the company to the area for seven years.

“I can live with $10 million,” Robinson told the board, saying that he felt sure he could secure the remaining funds somewhere.

Triumph’s total commitment of $66 million to Pensacola’s Project Titan represents the largest amount of funds the board has put toward any project. Robinson was told not to expect any more for the area.

“At some point and time,” Bense warned, “there will be members of the public saying, ‘You gonna give it all to Pensacola?’”