The latest version of state Sen. Louise Lucas' proposed hotel and conference center in Portsmouth is better than the original. But city officials should remain leery of the project and, in particular, the prospect of getting involved in its financing.
Last December, Lucas asked the City Council to provide $13.5 million in tax breaks and cash to help fund a $65 million complex at Victory Crossing.
The idea drew well-deserved criticism from council members and city voters, who questioned the size of the subsidy; the wisdom of a public official seeking tax dollars to assist in a private business venture; and the need for such a project just seven years after the city entered into a public-private partnership to fund the new Renaissance Portsmouth Hotel and Waterfront Conference Center.
The situation is also complicated by the fact that two City Council members have ties to the project. Recently elected Councilman Charles Whitehurst, who received a $10,000 campaign contribution from Lucas, has invested $2,500. Vice Mayor Marlene Randall's husband is also among at least 600 other investors in the project.
In recent correspondence with city officials, Lucas' attorney, William Nusbaum, indicated that his client now hopes to "try and do these deals without public sector support."
Under the new plan, Lucas would seek the council's authorization to use $32 million worth of tax-exempt bonds approved by federal officials in 1999 and set to expire at the end of next year.
Although the bond idea is better than Lucas' original $13.5-million request, it's still fraught with problems.
For starters, there's ample reason to question whether Portsmouth or the region can support another hotel and conference center. The Renaissance project holds long-term promise, but the city still isn't close to breaking even on the complex; in 2007, it generated $1.3 million in tax revenues but cost the city $2.5 million in debt service.
In recent years, the long-struggling city of Portsmouth has made tremendous strides in strengthening its finances. But the footing isn't so secure that officials can afford to invest city dollars - as Lucas originally proposed - in a project that would compete with one that isn't turning a profit yet.
For the same reason, Portsmouth officials also should be wary about using its remaining share of federal tax-exempt bonds for the project. Taxpayer dollars are taxpayer dollars, whether they're collected by the city or the federal government.
Council members might consider the possibility that, between now and the expiration of the bond program, another project better suited to Portsmouth's needs could come along. If Lucas' project gets the federal bonds, the city would be left with fewer options to help more worthy endeavors.
Victory Crossing is emerging as a jewel in Portsmouth's rebirth. Perhaps a hotel and conference center can and should be built there someday. But now isn't the time - especially if public money is involved.
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Senator Lucas
Hey, give her credit. She is a smart businesswoman trying to make a living. Why critize her. She is going through the proper channels. If she was just a private citizen no one would say a word. Why be down on her because she is an elected official. She pays her taxes like everyone else. I say give her a little support, if she makes it great, if she don't no one loses but her.
Source, please?
"Farm Fresh located there and the Wal-Mart at Mid-City have the highest theft rate for those 2 companies in the region. Not in this area, not in this state, but in the mid-Atlantic REGION."
Given that there are WalMart and Farm Fresh stores in some pretty "interesting" areas, I would really like to know the source of this claim. I googled away and couldn't come up with anything.
Thanks!
Has she lost her mind?
I'm a supporter of economic development projects. Contrary to popular belief, they usually bring in good jobs and produce important tax revenue for cities. But this one, however, clearly does not hold water. Beyond the impropriety of a State Senator asking for this money from the locality she represents, there is simply no need and no sound investment reason why this conference hall should be built. Midtown needs to be revamped, but city leaders should at best hope to turn it into Portsmouth's version of Greenbrier, not some regional destination.
A crown jewel?
The Portsmouth City Council would be well advised to steer way clear of this project because as the saying goes, "History repeats itself." If the Renaissance has yet to turn a profit for all the money the city invested why does anyone, state senator or otherwise, think this place will? I wondered how long it would take for the facts to come to light: 2 city council members have financial ties to the project. Randall and Whitehurst MUST abstain from ANY council business having to do with this project, failure to do so would reek of political favoritism. And what is this "crown jewel" business? Has anyone seen the crime statistics for that area? The Farm Fresh located there and the Wal-Mart at Mid-City have the highest theft rate for those 2 companies in the region. Not in this area, not in this state, but in the mid-Atlantic REGION. City council should be forewarned- keep our tax dollars for a more worthy cause instead of lining the pockets of another politician with a financially irresponsible venture and a predictably bleak future.