VIRGINIA BEACH, Va. (WAVY) — In its heyday, the Dome hosted legends such as the Rolling Stones, Jimi Hendrix and Ray Charles.

The city tore it down in 1994 — it’s been a parking lot for the last few years.

“That thing got torn down when I was a little kid,” said L.G. Shaw, Wave Riding Vehicles operations manager. “To be hearing about a coming Dome project since I was basically born, it will be awesome to see something actually take shape down there.” 

Once the new entertainment park is open, locals hope it will give everyone a boost. 

As the largest public-private partnership in City of Virginia Beach history, the Dome site redevelopment was approved by City Council Tuesday with a stipulation that some future revenue go toward flood prevention.

Council voted to approve the more than $330 million project with a 10-0 vote.

“The people who come here to visit, they normally Google places to eat… We’re one of the top Google recommendations of places to eat,” said Matthew Cabalbag, who works at the Beach Bully Restaurant, 601 19th Street. 

A lot of people are excited about the wave garden surf park, catering to every skill level from beginners to advanced surfers.

“To be able to have some dependable, ride-able fun waves I know is going to be well-received by a lot of the surfing community,” Shaw said.

While nothing can replace the ocean, Shaw says the wave pool will be a great alternative for local surfers with busy schedules. 

“Just this past weekend, we had a nor’easter push through town and we ended up with about a four- to eight-hour window of good waves… If your schedule didn’t allow it, you probably missed the pretty quick swell… Today is almost completely flat again,” he said.

The new wave pool will allow surfers to catch quality waves on their own schedules.

From City Council

City Council showed resounding support for the project, which is backed by music artist Pharrell Williams.

“I think it sends a positive message for those who want to do business with Virginia Beach in the future with (the) level playing field we demonstrated,” said Mayor Bobby Dyer. “I think we got the deal … that I really think will benefit Virginia Beach in the short term and long term.”

Councilman John Moss recused himself, citing a conflict of interest involving his connections with Dominion Energy and another corporation that could profit from involvement in the future project.

Atlantic Park — as Pharrell Williams named it — is a planned $325-million mixed-use, multi-venue development that is proposed for the former Virginia Beach Dome site, which is located between 18th and 20th streets at the Oceanfront. The proposal includes plans to build a 3,500-seat music venue, surf park, restaurants, office space and residential units.

An additional $9 million in city money was recently added to the deal to allow the city to buy additional property for the project. The development agreement states the project would like to acquire Dominion Energy’s substation along 18th Street for use in its project. Moss recused himself following an opinion from the Commonwealth’s Attorney suggesting he could have a conflict of interest.

If the land is purchased, the city’s cost for the project would be roughly $105 million and would be used to construct the parking garages, entertainment venue and common spaces.

The city would pay off its debt by using the Tourist Investment Program, which is made up of mostly hotel, restaurant, amusement and cigarette taxes. The lead partner, Virginia Beach-based Venture Realty, would secure financing for the remaining $230 million.

However, it’s the annual incentive payment of $5 million for 20 years where things get “complicated.”

Developers and city staff have pitched making the dome property a special district to be governed by a “Community Development Authority.”

Unlike the Virginia Beach Development Authority, the CDA proposed in this deal wouldn’t be run by appointed members, but rather all 11-city City Council members, according to Mike Culpepper with Venture Realty Group.

The authority has power to issue bonds, but since it is an “independent authority,” it wouldn’t impact the city debt. Those bonds would be paid through revenues and additional taxes levied on the project.

The $5 million per year would be used to finance a portion of the parking garages and streetscapes, per Deputy City Manager Ron Williams.

“Monies that are generated on-site that cover that bond are capped and all the other production of additional revenues do go toward to our normal dedications for the schools and for the general fund,” Williams said. “We used a balanced approach to do this partnership.”

The city anticipates the project could have close to an $8.2 million fiscal impact each year. Revenue distributions would include $1.9 million to Virginia Beach City Public Schools, $2.8 million to the city’s general fund and $3.5 million to the city’s Tourism Investment Program fund.

PREVIOUS COVERAGE: Dome deal vs. arena? What makes new VB proposal different than one currently in court

Councilwoman Jessica Abbott (Kempsville District) was the only person to vote against the term sheet in January, citing two main concerns. She didn’t like that the city would issue additional debt and she didn’t like how none of the potential tax revenue was earmarked to combat flooding.

On Tuesday she addressed one of those concerns by successfully having a resolution pass that dedicates 25 percent of the general fund revenue to stormwater improvements.

“A dedicated revenue stream for a major project like this to fund stormwater improvements will reiterate this council’s commitment to solving our stormwater infrastructure challenges,” Abbott said.

As the largest proposed public-private partnership in Virginia Beach history, steps are being taken to make sure the city doesn’t end up in the same position they were in with the arena developer. In that case, the project fell apart when the city claimed the developer failed to close on their loan at the 11th hour.

“This development agreement is unique because it does essentially lay out a process to get to a project versus just saying we’re going to agree on the project and then you’re off and running,” Williams said. “What it does is give us the due diligence in the free development phase to make sure that the project is sized right that it’s feasible and that it can be financed.”

To come to fruition, the agreement needs to be approved by both the Virginia Beach City Council and the Virginia Beach Development Authority.

The agreement covers the process for delivery of the project, such as construction plans and schedules, the guaranteed maximum prices for the components and the process for real estate closing.