Wednesday, September 1, 2010

Guilford County Commissioners Public Hearing for Downtown Hotel Project: September 16th

"The controversial hotel project proposed to be built on South Elm Street in downtown Greensboro across from the new International Civil Rights Center and Museum keeps chugging along, and the board set a public hearing on that matter for its Sept. 16 meeting.

There was a little bit of controversy when the board voted to schedule the hotel hearing because Alston didn't take part in the discussion or the vote. He wasn't in the meeting room when commissioners talked about the issue because he intentionally remained in the back room after a recess.

Board members should avoid impropriety
in the exercise of their official duties.

Their official actions should be above reproach.

A board member is considered to be acting with impropriety
if a reasonable person who was made aware of the totality
of the circumstances surrounding the board member’s action
would conclude that it was more likely than not
that the behavior did not befit someone in the board member’s position.

…They should act as the especially responsible citizens
whom others can trust and respect.

…they should be willing to put the board’s interests ahead of their own.

Code of Ethics for the Board of Commissioners
of Guilford County, North Carolina
...Alston cited a "perceived conflict of interest," but Commissioner Paul Gibson pointed out that Alston – who was a broker for the hotel property, but whose work with the project is now said to be done – has himself claimed there's no longer any conflict of interest. Gibson said it therefore wasn't clear Alston should be allowed to exempt himself from the vote.

Avoid deriving a direct benefit from contracts
in which you are involved in making or administering
on behalf of the public agency. (G.S. 14-234((a)(1)

Code of Ethics for the Board of Commissioners
of Guilford County, North Carolina
While Alston claims his part of the deal is over, he presumably will not get paid his broker fee until the deal goes through and therefore it could be argued that Alston is still very much involved with the deal.

If Mr. Alston's fee is dependent upon the closing of the project,
will the payment of the fee be a violation of Guilford County's Code of Ethics?

...The hotel project has gotten the green light from the NC Department of Commerce to apply for special stimulus package bond financing, and the Guilford County Board of Commissioners must now hold a public hearing on the project. After the hearing, the commissioners will vote whether or not to allow the project's financing to move forward.

Should the the projected food and beverage revenues of of $115.93
in the January 18, 2010 analysis
be three times higher than the Downtown Marriott?

If average food and beverage revenues in the January 18, 2010 analysis
for comparable downtown hotels in large cities ranged from $75.54 to $92.28,
how can the February 16, 2010 analysis project food and beverage revenues
of $169.29?

How could projected food and beverage revenue rise
from $115.93 on January 18th,to $169.29,
less than 30 days later, on February 16th?

The hotel group is seeking the right to sell bonds to private investors. No direct taxpayer money will be used to pay for the hotel – instead, the group gets the right to sell interest-free bonds to private investors.

Except for the Tax Credits, right Scott?

The bonds' tax-free status makes them more attractive to buyers and sellers, and therefore makes it easier for the hotel group to get financing.

Will profits, which mean local tax revenues,
come directly out of the pockets of privately owned local eateries and caterers,
not counting new competition from the Greensboro Coliseum's
soon to be publicly owned VIP room?

While there's no direct expenditure of taxpayer money, one could argue that, since the money to pay for the project isn't taxed, it is a government subsidy, just not a direct one.

Except for the Tax Credits, right Scott?

If, as expected, the hotel project's financing gets the green light from the Guilford County Board of Commissioners after the September public hearing, the issue will then move to the NC Local Government Commission, which will be the group's final governmental hurdle.

How can an independent analysis performed by the same company
believably assert that occupancy projections rose 20% with 10% fewer rooms
inside of a month?

But the hotel backers would still face the big obstacle of actually finding buyers willing to put their money at risk over a project that has brought with it so much controversy."

Scott Yost
Rhino Times

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