TDH: 6/28/11

Controversy building around incentives to hotel developer

TDH: 6/28/11
Photo courtesy Flickr user Mike McCaffry [CC]

Formula One is receiving the lion's share of attention at council's special called meeting tomorrow, the first with Kathie Tovo on the dais. But a potential development deal with hotel builders White Lodging is also up, a proposal that's already created fault lines on the council.

The item up for consideration tomorrow would grant White Lodging $3.8 million in fee waivers & $500,000 in assistance relocating a wastewater line in order to build a 1,000-plus room convention center hotel.

The item, initially posted to council's July 23 agenda, was postponed following semi-heated discussion at council's Tuesday work session last week. Mike Martinez, one of the item's co-sponsors (along with Lee Leffingwell and Bill Spelman), emerged as one of the item's most stalwart defenders. Comparing the hotel fee waivers to ones the city grants to revenue-generating South by Southwest, he said “I'm not trying to oversimplify it, but that really is what we're talking about. We're talking about a one-time fee waiver of a little more than $4 million, a one-time fee waiver for a lifetime of benefit. Hundreds of millions of dollars. Not just a one-time hit. We do this on a regular basis. So I'm fully confident that we can get this done by Thursday. I appreciate the questions and concerns. I am supportive of this obviously as a co-sponsor. But I will also work and put all hands on deck with my staff to get everyone's questions answered.”

But Laura Morrison wasn't having it. Announcing that she would seek a postponement of the item, she said “I'm very concerned about the timing on this. I understand that intuitively it's seems to make sense. But I feel like we have a responsibility to the public to get these numbers out there, to allow people to take a look at them. If you will recall, with our 380 agreements we have a very strict schedule and this amount of money is on par with the amount of money we do in our 380 agreements. We have a very strict schedule that allows for public input, even if we get the numbers up tomorrow … Oftentimes in this position, we have to make a decision between running the risk when we're told we have to rush it through and it might fall through versus doing our due diligence, and I feel like if a month is going to make that much difference – I guess it's hard for me to grasp that a month is going to make that much difference.”

Postponed, the item is another juicy morsel for new council member Tovo, fresh off her incentives-bashing campaign, to sink her teeth into. And if that's not enough, developer Perry Lorenz and his pals have made a big media splash floating their own convention center hotel designs.

It'll be an interesting one Wednesday.

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