Tuesday, July 17, 2007

Harrison Square, the story keeps changing

The City now has a deal in place and it is worse then I expected.

Please read coverage of this from Jeff Pruitt over at the Blog Fort Wayne Left:
<http://fortwayneindiana.blogspot.com/2007/07/subsidy-square.html>

Jeff provides great coverage of this.

I have a few things to add:

1. I told you so. (I cannot help it)

2. For a long time Fort Wayne and Harrison Square supporters have insisted that more then half of the project would be funded by private investors. I have scoffed at this for just as long. I have always maintained that more then half of the funding would be public. It is now official. My guess is that if everything was considered it would be 55% publicly funded or more...

3. There is a clause that would cause Fort Wayne taxpayers to subsidize the operations of the new downtown hotel an additional $250,000 per year if the hotel does not meet its internally generated benchmarks. We could be forced to provide $250,000 per year for TWENTY years!

4. The City has always maintained that the hotel would be a higher end hotel then the hotel that is now proposed. In the beginning the hotel was to have 360 rooms, then 300 rooms, and now it is 250 rooms. The hotel is much smaller and of a lower quality then what the City has been using in its studies. The hotel will generate less revenue then expected and this fact has ensured that more then half of the project will come from public money.

5. The hotel now wants another additional subsidy that the City has agreed to provide; a one million dollar above-street walkway...

I could certainly go on and on.

It is apparent that the City has sold our City Council and the taxpayers a "bill of goods" Slowly but surely the truth is coming out.

Good grief.

Mike Sylvester

11 comments:

Anonymous said...

Mike - At the Common Council meeting tonight, Becker and company were frankly flustered and frustrated by the questions of not only The S-Boys(Schmidt, Shoaff & Smith) but also the Tom-Boys(Hayhurst & Didier). Just maybe......................... John B. Kalb

LP Mike Sylvester said...

John:

I was not able to attend the meeting.

There should have been a lot of questions...

Mike Sylvester

Anonymous said...

John,

What world do you live in? My god you really could not hear last night. They were never flustered by the questions. Are you just making this stuff up?

Mike, what about the good news?:

1. We now know that Smith and Shoaff's attempts to back the HOTEL out of the private dollars BECAUSE it "would be built anyway" is flat out wrong. The HOTEL would not be built without Harrison Square and is in fact conditioned on the H. Square development.

2. The Walkway is a positive development for downtown connecting the Embassy and GWC and potentially helping with the development of the Indiana Hotel.

3. The Suites have oversold like hotcakes to the business leaders in this community. So much so that Hardball, on their dime, will build 4 additional suites to meet the demand.

So you and John K. should take off your black covered glasses and recognize that this is going to be a success and a great thing for downtown and the community. Mike, I will buy you and Mark Garvin (and maybe even John K.) a beer on opening night of the stadium.

I will now brace for the onslaught of negativity that will surely be posted in reply.

Sam T.

Anonymous said...

PS. Mike, as a CPA, you should know that this is how deals come together. The details do not get set in stone from the onset. That is the whole idea of Negotiations. Deals eb and flow, one side wins one battle and the other side wins another and you eventually end at a defnitive agreement. Thats why they call it a DEFINITIVE agreement, because until you have one, terms and conditions can move and change. So, the story is NOT changing, the deal is just naturally progressing through negotiations to a definitive agreement.

Sam

John B. Kalb said...

Sam - naturally progressing or falling apart? I'll take you up on your offer and I'll buy when Hardball backs out - that's a promise! John B. Kalb

LP Mike Sylvester said...

Sam:

Give me a break.

There is no back and forth in this negoitation. If the City wants the project to go forward they have to give the hotel what they want.

Every new item about the hotel that has been released to date has meant more public funding.

They have us "over a barrell" and unfortunately for the taxpayers The City is not willing to admit that the deal cannot be done without the public kicking in close to 55% of the funding...

Mike Sylvester

Anonymous said...

Sam

As a supporter of Harrison Square, it is somewhat disheartening to see Mike's predictions all coming true. No offense, Mike.

Anonymous said...

Sam, Jr. Your normal perceptivness must have been off last night. If Becker wasn't flustered last night (and I will take your word for that), then I will bet he is tomorrow morning. See Ben Lanka's report - or look at AWB or Sylvester's blog tonight. John B. Kalb

Jeff Pruitt said...

Sam,

You can't possibly be serious about the walkway. It has nothing to do w/ hotel operations. They simply know that yourself and others have too much vested to say no at this point. We're building them a $12.5 Million garage, giving them $6 Million in tax credits, $2 Million in land, $2.5 Million (possibly $5 Million) in cash and 10 years worth of abatements. And they have the nerve to demand $1 million MORE? All for a Courtyard by Marriott.

This is an honest question Sam. Is there anything you would say no to at this point? Seriously, what would it take?

Also notice that there's nothing in the agreements to ensure that local businesses have a stake in the operations. This is something councilman Didier and myself urged them to do yet we they couldn't even negotiate that into the agreements...

Anonymous said...

Mike 1 Sam 0

Bobby G. said...

Mike:
Nice "serve"...!

B.G.