They’ve got to be kidding.
The Civic Center Authority decided today “to ask the Peoria City Council next month to expand the Warehouse District TIF to include the site of a proposed hotel,” according to the Journal Star.
That’ll go over like a lead balloon. I can’t wait to see the council laugh the Civic Center Authority out of council chambers when this comes up. This is such a bad idea on so many fronts, it’s hard to know where to start.
Let’s start with the fact that TIF districts are for blighted areas, and the Civic Center just completed a $55 million improvement to their property. TIF districts have to pass the “but for” test: “But for the incentive provided by Tax Increment Financing, would development occur in the designated area?” At the Civic Center, they just completed $55 million of development on the site.
On that last point, here’s a little taste of their logic:
Without the [TIF] expansion there’s little chance the developer of a full-service upscale hotel attached to the Civic Center could be lured to build on the proposed site at the northeast corner of Kumpf Boulevard and Jefferson Avenue, officials said.
I hope this is not the argument they’re planning to use to show that they pass the “but for” test. That’s not how the test works. The test is whether there would be any development, not a specific development like a hotel. Otherwise, you might just as well put a TIF out at the Shoppes at Grand Prairie because “but for” a TIF they can’t get a Nordstrom.
Then there’s the fact that the City Council already turned down a previous attempt to expand the proposed Warehouse District and Eagle View TIFs. When the Peoria Housing Authority expressed interest in being included in the TIF, the Council essentially told them to take a hike. What makes the Civic Center Authority think the Council will look on them any more favorably?
I could go on and on, but let’s wrap this up with the pièce de résistance: This whole hotel issue is the result of poor planning at best, deliberate deception at worst. As I wrote in a previous post, the Civic Center Authority said this to the City Council in a letter last March:
The Peoria Civic Center Authority is not now and has not previously requested public funding for a hotel. We have always hoped that a private development would be interested by the Peoria Civic Center expansion and upgrade to come forward with a proposal. We hope that the community will enable such a development.
The Peoria Civic Center Authority is committed and continues to be committed to the success of the expanded facilities. We believe it can be successful without an attached hotel but more and larger regional opportunities will be possible if more and better downtown hotel rooms are available.
To come back to the council with their hand out less than a year later, before the mortar is even dry on their $55 million expansion, claiming that now they can’t be successful without a publicly-incentivized hotel connected to the Civic Center is irresponsible.
CJ — Didn’t it turn into a $60 million plus expansion (about $63 million) and plus the interest on the bonds because we cannot afford to buy it now?
So, taxpayers are really paying upwards of 2 times the amount of the expansion as in $110 or $120 or $126 million?
But for we’re broke and we cannot afford anymore developer welfare handouts.
It’s very simple, remember what the consutlant studies said. Hotel isn’t needed. What is more important is to work to improve the downtown area between the Civic Center, other attractions, and the already in place hotels. Strengthen from within. Another hotel will only increase the vacancy rates in other nearby hotels and willd definetely hurt the hotels during major civic center events. This isn’t about the TIF as much as it should be about economic reality.
I have the solution. A sky walk from the Civic Center to the new Embassy Suites in E.P. The Park District could have the contract for events on the sky walk to give people something to do along the way back and forth. There could be a divider along the length, one for smokers and the other for non-smokers.
SA: That is really thinking out of the box! Sounds like you would be a good fit with the politicos….are you considering a run for public office?
At least the voter would know what we are getting upfront vs. the usual chameleon affect which occurs when a candidate becomes an elected official.
Did Thetford get appointed to the CCA without me knowing?
oh oh, how about a parking deck. those are never turned down
We are competing against towns big and small throughout the midwest for convention business. We will not bring these to town without an attached hotel. Conventioneers don’t want to walk from the City Center or the Mark Twain and not everyone is thrilled about staying in a historic hotel’s smallish room or staying out further and having to drive downtown and pay for parking. Conventions don’t get booked with the lines “hotels within walking distance” (after you’ve heard that a few times you realize walking distance can mean many things) or “4 star hotel across the river.”
If the civic center expansion is being done for the purpose of attracting larger and higher quality conventions, then this hotel needs to be built, and it can’t be a Hampton.
I’ve heard that Hilton is “practically begging” to build there. Before someone says “so let them build”, don’t be so naive to think any large outfit is going to build without some-kind of incentive. It just doesn’t happen. You can tell them no, but you’re just shooting yourself in the foot, if you ask me.
I understand the need to stimulate the economy. Hotels do not pay family wage salaries for the most part. I understand the revenue that a potential hotel can bring in, assuming other hotels don’t go belly up negating that, but I also understand that our neighborhood’s children are walking on dangerous sidewalks to and from school. I understand that drugs are being sold openly on street corners, despite valiant efforts by police, and see slumlords raping our neighborhoods and families of thugs taking over the streets shooting or terrorizing everything in sight (urban terrorists)…. and and and…. I know everything can’t be a priority, but would rather start attracting quality, hard working tax paying residents for a while vs. subsidizing guests. I think people would walk from the Pere (1/2 block) or two blocks from the City Center (assuming they renovate) etc, IF we start attracting areas to shop, things to see and do of interest as they walk by these areas. There were tons of youth downtown today for some event. Many cities do have attached hotels.
How about a vision of something else to make Peoria the place to be, reasons to stay downtown that other city’s don’t offer. STrive for something other than a McConvention atmosphere–A little creativity and get multiple businesses attracted to the area and investing instead of using tax dollars.
thoughts?
P.S. Hilton was here–now the Pere, remember?
THIS CITY IS F–KED UP!
PI,
What evidence do you have of your assertions? Why won’t a first class convention center, at prices much less than the McCormick Places of the world, attract quality shows and convention business, without an attached (government subsidized) hotel?
SA- I have no hard evidence or expert studies, but I have a lot personal experience. We won’t have the only first class convention center around. Booking a convention at the Civic Center is not cheap, and the conventions that we need and want are ones that might go to Omaha, Cleveland, or Memphis. The trouble for us is that there are a lot of cities who work really hard to get the lucrative convention business.
Think about the IHSA tournament. The city came together and pulled off something that no-one thought was possible; but we were only competing on a small state-wide basis against just a few cities. Now we are competing on a larger scale.
If you want to bring in the convention business, the city has to back it and show some commitment. A typical conventioneer wants a nice room which is usually on the company tab, with a restaurant and bar. They also want it as close as possible to the venue. The last thing they want after either walking or working a convention all day is to walk 4 blocks to their hotel or drive across town.
The people who are putting on whatever convention it may be are comparing not just the cost and the facilities, but the city as a whole and how they can market it to get the most attendees as possible. I don’t see much in the way of hotels in downtown Peoria to attract that business. When you travel somewhere, after figuring out how to get there, you are looking for a good hotel as close as possible to where you are going.
As for McCormick, they (and the unions) priced themselves out of the market many years ago. We’re not competing against them. McCormick is competing against Vegas, New Orleans, Orlando, etc…
I don’t mean to say we should pimp the TIF, but I definitely think we should do whatever is possible to bring a major high-end chain downtown; attached is a big bonus. Let me ask you this- if you were coming to town, would any of the downtown hotels really get you excited?
It’s not about hotel revenue, it’s about convention dollars. If it were about anything else, we wouldn’t be spending so much cash to expand and upgrade the civic center. Let’s finish the deal and do it right.
PI: And how about crime? Not just a perception, the reality of it… And how about that lovely ‘seat’ presentation in the baggage claim area, unless it has had an upgrade recently with the three-four inch tears in the seats? How about first impressions??
I am positive that a multi-million dollar [revenu draining] museum, coupled with a multi-million dollar hotel will set things right in Peoria. Peoria Illinoisan does present a a good argument. I can’t see comparing Peoria to Cleveland, Memphis, Omaha, etc. Those cities have something else to offer convention visitors… entertainment! You could spend hours walking around those cities, taking in the shops, bars, etc. I can walk the downtown area of Peoria in 15 minutes and not spend a dime.
I acknowledge that in large cities, people will more willingly walk or take a cab or drive from a somewhat remote hotel to a convention center, or pay $20-$30/day to park their cars, to attend an event or go shopping.
I still am not convinced that the presence of an attached or adjacent hotel is going to make that much difference; at least I don’t think we should bet tax dollars on it. Why can’t we create a convenient, attractive, even fun transport experience for the convention-goers, to get them from their hotel or parking site to the Convention Center, and back?
Can we stop making this an either/or? From what I gather about TIF, or at least this case of use of a TIF, we aren’t robbing Peter to pay Paul. It sounds like a hotel isn’t coming without an incentive. The incentive would come from an “advance” of the property taxes they will pay. They won’t be taking crime-fighting money to pay a developer. And, by the sounds of the article, if it really won’t get built without the TIF incentive, then there still isn’t one more dime to fight crime. This is not an either/or situation.
Now whether this thing gels with the Warehouse District is a different question, but y’all are being a bit dishonest/confused about the source of this money.
PI: What really bothers me about this is the bait and switch. The CCA assured the city that it could do this $55 million expansion and wouldn’t need a hotel for it to be successful or any city assistance for a hotel. Before the ink even dried on the council’s endorsement of that plan, here they are back at the city trying to not only get a hotel, but trying to get the city to pay for incentives! The whole $55 million will be “for naught” if they don’t get a hotel now. Talk about playing the system.
I think the CCA should be held to their word. Since they entered into this project with assurances that it could be successful without a hotel, they should live with it for at least 5 years before coming back to the city begging for money.
Dude: I don’t think anyone’s confused about where the money comes from. The issue is two-fold: (1) Should the city be subsidizing a new hotel? and (2) if the answer to the first question is “yes,” is making the hotel site a TIF the right way to incentivize?
For many, the issue ends at question 1. They don’t think the city should be offering incentives to draw a new hotel to be attached to the Civic Center for a variety of reasons, the most common of which is that there isn’t enough of a market to support another hotel; thus, it would likely put another hotel out of business.
But even if you answer “yes” to the first question, I would still argue that making this site a TIF is illegitimate. TIFs are for the redevelopment of blighted areas, and this area is clearly not blighted, nor does it pass the “but for” test. It’s when TIFs are abused in this way that people hate them. The Warehouse District and Eagle View TIFs as they stand now are the way TIFs are supposed to work.
I have always held the belief that the hotel is necessary, and I still believe that. If the CCA’s past statements will doom this project in the short-term, it’s unfortunate, and I don’t mean to sound like I am defending them because I am not.
This discussion won’t end with their denial of the TIF, and we will continue to hear that a new hotel is needed when we find out that the ‘bigger and better’ Civic Center isn’t bringing to town any better conventions. They’re not not expanding it to accommodate a bigger “Home Show”.
I will say it again- if this is going to be a first class convention center, then it needs to have first class amenities to go along with it. We currently cannot offer that.
In a weird sort-of strange way, maybe PeoIll has a point. Dealing with CCA [and Peo City Council for that matter], has always been a headache. Flat out denying the possiblity of a future hotel might be cutting off the head to cure the headache. Problem is neither “party” has an impressive record when it comes to doing something right for Peoria and potential growth. Lost businesses [do I have to mention Par-A-Dice?], and the support of projects with limited potential have crippled Peoria.
The players involved in these decision making processes are all part of the same small group. Are we really going to get anywhere?
CJ, I don’t necessarily agree that the hotel sight doesn’t belong in the TIF because it’s not blighted. But let’s not fool ourselves, not every parcel in the proposed TIF is. Ask Pat Sullivan if his property should qualify?
Before seriously considering tiffing a hotel site in probably one of the most desirable commercial sites in the City, let’s take a step back and look at our basic property and revenue taxing system. It’s too difficult and unfair for local government to decide the winners and losers, which so often happens with TIFs, EZs, etc. Let’s come up with a system that provides development incentives for everyone, in every location, without discriminating against those already here.
“Why won’t a first class convention center, at prices much less than the McCormick Places of the world, attract quality shows and convention business, without an attached (government subsidized) hotel?”
Because the convention business is moving south and to Vegas — warm places, and places with gambling. Chicago and other northern convention cities are losing business at a pretty fast clip.
But I’m not really sure how a hotel is going to make people want to come to Peoria for conventions. It’s nothing against Peoria; I love it here — but most people seem to want to go to conventions in warm sunny places, or Vegas. People don’t usually pick Minneapolis or Anchorage.