Panel Urges City Subsidies for Hotel Project (Los Angeles)

Los Angeles Times ^ | September 20, 2005 | Patrick McGreevy

[calcowgirl]

A City Council panel recommended Monday that Los Angeles provide $266 million in subsidies and loans to the developers of a 55-story hotel next to the Convention Center, but opponents threatened a referendum drive to put the matter before the city's voters.

The financial deal was endorsed on a 4-0 vote by members of the council's Ad Hoc Committee on the Convention Center Hotel, with Councilman Tom Labonge and others saying that the project would make the center more competitive and breathe new life into downtown.

(snip)

The project also was endorsed by the Los Angeles Chamber of Commerce and the Central City Assn. as necessary to help the Convention Center attract sufficient business to pay the $30 million in annual debt payments incurred during the center's construction.

(snip)

However, Peter Zen, an executive with the Westin Bonaventure Hotel, said he would press a lawsuit challenging the project.

Zen also announced that he was considering a referendum drive to require voters to approve the city's plan to let the developers keep the $246 million in hotel bed taxes expected to be generated by the hotel during the first 25 years. He said he would need to collect 40,000 signatures from registered voters to put the issue on the ballot.

(snip)

Chris Sutton, an attorney for the Bonaventure, argued that the city should rely on the private market to build the hotel based on its chance for success after the construction of a $1-billion companion development called "L.A. Live," a mix of theaters, restaurants and other attractions.

(snip)

The break on the bed tax, a $16-million loan and the waiver of $4 million in building fees were proposed in a deal with developers AEG, Wolff Urban Management and Apollo Real Estate Advisors.

[freekitty]

Why dan't they let the damn developers shoulder the cost. Why should the taxpayers make them rich?