Virginia Beach's Money Pit

If you’ve been driving by that muddy pit, flooded with arsenic-tainted water along Pacific Avenue between 18th and 20th Streets at the oceanfront, you may wonder just how much public money is going into the surf park two blocks from the actual ocean.

Especially now that city council has hiked taxes. Again.

Hang onto your wallets, says former Councilman John Moss. The city has negotiated another curious deal with a developer.

Sigh.

Some things never change.

Let me refresh your memories. Back in the summer of 2022 the city was desperate to get back into the good graces of Pharrell Williams who’d soured on his home town, saying Virginia Beach had a “toxic energy” after his cousin was killed by a police officer in 2021.

So a contingent of city officials traveled to New York City to blow in Pharrell’s ear. When they came back, they refused to reveal exactly what had transpired.

But shortly thereafter, Williams announced that his “Something In The Water” festival would return to Virginia Beach and plans were green-lighted for “Atlantic Park” a $335 million, 12-acre development at the oceanfront with Williams as an investor.

Did I mention it’s going to include a surf park? Two blocks from nature’s own surf?

If memory serves, a glad-handing member of city council told me at the time that public investment in the project would be small, about $54 million.

“More like $100 million,” I retorted.

Turns out I was wrong. Tax investment in the project now stands at $156 million, according to Moss.

After I asked him for details about the Atlantic Park project, Moss was kind enough to prepare a thorough primer for taxpayers who actually care about how their money is spent.

Kerry Dougherty

By John Moss

John Moss

Atlantic Park:  What a few know that we should all know. 

1.  If the City-owned music venue does not open on time, the city will owe damages to Live Nation. On-time is May 2025.  
2. If the city-owned music hall does not open on time, the developer will owe damages to the city.  
3. If Atlantic Park does not open on time, the developer owes damages to the city.  
4. If Atlantic Park does not open on time to include the City-owned music venue, the developer may have a liability with leasing entities and the possibility of lease cancellations. These private lease agreements are not subject to FOIA.
5.  The financial liability for the wave pool site contamination for a yet-disclosed cost remains unresolved.
6. Mayor Dyer and Council Members are aware of these facts and more. Yet, they have kept us in the dark on a project where the public has invested $156 million of the taxpayers’ city debt capacity.  

Atlantic Park, what we need to know as taxpayers from our City Council is the following: 

1.  Specifics on how damages will be calculated, how much money we could be talking about, and what is(are) the source(s) of funding for any damages possibly owed. 
2.  The critical path item(s) that are the source(s) of schedule risk that would preclude meeting the contractual definition of being opened in May 2025.
3.  The exact date in May 2025 that is contractually defined as the opening date.
4.  The exact facilities that have to be operational on the contractually required date in May 2025 to constitute Atlantic Park being open to preclude any claims for financial damages. 
5. The reason Mayor Dyer nor any council members, did not inform the public about taxpayers’ potential financial exposure to damages if the opening date is missed.   

Atlantic Park, the following are sad facts:

1. Mayor Dyer and a majority of the City Council entered into the Atlantic Park agreement without any auditable business case analysis. The City Council when voting to approve the agreement, had no validated knowledge of when the Atlantic Park project would contribute the first dollar (return on investment) to the unrestricted general fund.  The former fact is validated by public statements made by the City Auditor.  
2. The City Budget Director in briefing to the Virginia Beach Tea Party a year ago stated to paraphrase, “The earliest Atlantic Park would deliver its first dollar is seven years from the date it opens.” Therefore, May 2032 is the earliest taxpayers will see a yet-to-be-known dividend.

Atlantic Park, the conclusion voters should draw is as follows:

1. There is no exit strategy from what was then and remains an ill-thought-out investment by the Virginia Beach City Council. They’re using taxpayer-owned property and city debt capacity for a project that offers no prospect of a meaningful net dividend to Beach residents.

John Moss is running for mayor of Virginia Beach. For more information, go to his website, JohnMossforMayor.com