elpasospeak

Plans were announced recently to build a $64 million dollar hotel on airport land.  The hotel is to have 220 rooms and 80,000 square feet of retail space.

It is being touted as being of four star quality.

That’s good

Having 220 high quality rooms should be good for tax revenues, right?

Well actually the city gave the hotel developers tax breaks.  Among them is that they will not have to pay hotel occupancy taxes for 11 years.

That’s bad

Hotel occupancy in El Paso is down.  Now we have a situation where existing tax paying hotels will have to compete with a new hotel that has tax advantages.  That could mean that up to 220 rooms a night will not be paying hotel occupancy taxes, the supposed prime source of funding for our ball park.   According to an article in the El Paso Times:

It is to receive millions of dollars in city incentives, including property and sale tax rebates and won’t pay land lease fees for three years under a 40-year lease with the airport. The City Council approved the incentives and lease in May.

I don’t know why the Times article neglected to mention the hotel occupancy tax abatement.  Most of us can probably guess.

Call me crazy but I don’t think that we should use local tax dollars to hurt local tax payers in favor of out of town interests.

Locally beneficial

Well there is one local company that is probably interested.  The company that has assumed operations for our local contractor  that is building the ball park expected to be hired as the building contractor according to the Times.

Bad plan

Airport traffic volumes have been declining for at least the last ten years.  If the city wants to encourage an upscale hotel they should look at having one built at our nationally ranked municipal golf course.

It seems to me that making El Paso a golfing destination would offer us better economic hope than cannibalizing existing trade.

We deserve better

Brutus

The February 11, 2014 city council agenda shows that council will consider hiring a firm to help us with the “digital wall” that voters approved as part of the quality of life bonds.

This will be the second such wall on the planet with the other one at the Museum of Copenhagen.

The city has evidently decided to use the product marketed under the TouchCity brand.  The agenda proposes a “sole source” procurement since there is only one company in the world that makes the TouchCity brand.  That is obvious but it does not mean that other companies could not bid on the work.

The agenda backup material contains more of the city spin when it says “TouchCity Wall (Digital Wall) was overwhelmingly supported by the voters in November 2012 bond election [sic].”

Bunk

None of us voted for a TouchCity Wall.  We voted for a digital wall and now staff wants to buy a particular brand so they tell us that we voted for that brand.

The company that makes TouchCity is headquartered in New Zealand.

Train wreck

The proposed contract (read it here) is a train wreck waiting to happen.  Among other problems:

• It contemplates that the wall will be “integrated into a “welcome pavilion” to be built by others onto the exterior of the museum”.  The pavilion has not been built and as far as we know has not been funded.  The city has been looking for someone to donate the one million dollars needed.
• The contract contemplates completion in December 2014.  Remember that the “welcome pavilion” has not been built yet.
• The specifications are almost non-existent.  “The first phase of the work will also see the parties agree and document a process path and schedule for the completion of the rest of the phases of work …”.
• The normal “Applicable Law and Venue” portion of city contracts (where Texas law is said to govern the contract and El Paso is where any lawsuits will be tried) does not seem to be part of the contract.  In fact the parties agree to mediation where the party picking the mediator “will be instructed to take the international nature of this Agreement into account when appointing a mediator”.
• Roughly $1.8 million will be paid to the firm for services, not product.
• Part of the work will be done by the New Zealand firm, part by the city, and the equipment will be acquired from other firms.  The equipment to be acquired separately is projected to cost over half a million dollars.  This is a recipe for finger pointing.

We deserve better

Brutus