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Eight years after Virginia Beach's leaders agreed to spend public money on a hotel development and parking garage, some taxpayers still grouse about that symbol of public-private partnerships.
They are less critical of the partnership that built the wildly popular Town Center. But the financial reports for both projects are encouraging as Virginia Beach decides its vision for the Dome site, a convention center hotel and a revitalized resort area.
By every measure, the city's investment around the Hilton Virginia Beach Oceanfront has proven to be a good deal. It spruced up a once-seedy strip and provided a public park at the Oceanfront. Its biggest benefit has been one for which it won't get credit: jump-starting the makeover of Atlantic Avenue hotels forced to compete. But in a more tangible way, it's bringing in $1.3 million more a year than the city is spending to service its debt and operate the parking garage.
In the most recent fiscal year, the city received $3.46 million from rent and sales tax, real estate, personal property and business taxes, and made $608,000 from the parking garage. In contrast, it spent $2.35 million in debt service and $389,000 to operate the garage.
The development - a premier, 21-story hotel, neighboring Neptune's Park and a public garage and retail complex across Atlantic Avenue - opened 3-1/2 years ago at a cost of $79 million. Developer Bruce Thompson and his partners put up $47 million; the city pledged $31.5 million for the garage, park and land purchases.
The City Council's vote for the development angered residents who had rejected the plan in a 2000 nonbinding referendum. They said the project would benefit developers, not the city, and that Virginia Beach should've built a park on the site, not a hotel. In fact, it got both. And a safer, livelier corridor along the Oceanfront.
Town Center, which also has spurred high-quality development in the once-moribund commercial zone at the city's most important crossroads, is generating millions in revenue through various taxes. Virginia Beach, which has invested in parking garages, a conference center, sidewalks and other infrastructure, gets $5.8 million a year, not counting the portion of real estate taxes that pays all of the debt service on $69.2 million in bonds.
The project, the brainchild of developer Gerald Divaris, overcame 20 years of skepticism that a sprawling suburb could manufacture and sustain its own downtown. Along with 31st Street, it's testament to how vision, risk and political boldness can remake a city one block at a time.
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Mr. Barrett
It is of no consequence about big retail boxes on Virginia Beach Blvd. The fact is that private enterprise is just that.. private. No public money from any city government should be used to build these retail shopping outlets. The city will make money on real estate and sales taxes anyway on whatever is built. If PPV's are a legitimate "tool" then the city can pay a percentage of my mortgage. That's what your logic equates to. Besides you have a vested interest in PPV's which means guys in your business will not have to pay full fair market price for your properties, but will you still reap the profits thanks to the taxpayers dime. City government (especially VB) finds creative ways to spend any windfall profits rather than any tax benefits to us. $150K for a full color ad to The Virginian pilot comes to mind.
TRUTH
In May of 2004 Robert Dean, co-founder of the VBTA, earned 43% of the vote in a three-way mayoral race, which was put together in four and ½ weeks., nearly defeating Meyera Oberndorf who drew 50%. So there Mr. Barrett, so stop with your convenience talk (words that sound good, but certainly are not true!) Additionally, when are you going to come out in public and debate with those from the VBTA?
Truth and Consequences
Fair enough, but your characterization of the projects to which you object at the Beach do not fit your description. Fact is, both 31st Street and Town Center have been highly valuable projects for the taxpayers. Now it is a legitimate position that the city should never engage in PPV's, but if you make that argument, you have to accept the consequences of that action. That includes another big retail box on Virginia Beach Boulevard that sends all its profits elsewhere, or in the case of 31st Street, simply another fun 'n the Sun motel (no park) that serves summer visitors and stands mostly empty the rest of the year. Frankly, the majority of citizens want a planned city that develops a strategic vision and is not timid about using legitimate tools like PPV's to get there. Now I know that majority does not include the VBTA, but frankly, every time one of them runs, they get 5% of the vote. Not exactly a majority.
This is it
Give me an example of the public services you speak of Mr. Barrett. Otherwise I have no problem with commercial real estate companies purchasing land at the fair market value from the city (if applicable), getting your zoning permits, easements, etc.. and making money on it. No problem at all. Provided it is done ALL on your dime. What I do object to is taxpayers having to subsidize part of it, or using eminent domain to seize land for private developenment for a sliver of a so-called "public park", and having taxpayers take the fall if it fails. Projects like Waterside (Norfolk's problem), The Sportsplex, The Days Inn Hotel on Bonney Road, etc.. Things that I indirectly have to pay for with taxes and fees extorted from me. That is what I object to. I feel that Will Sessoms will be the taxpayers bank to fund these "public-private ventures that government has no business getting involved in and guys in your business will be receiving end for the check.
Which is it?
Well Keith, you better check the talking points of the VBTA who espouse increased commercial real estate development so that the commercial real estate sector pays more of the real estate tax burden. So which is it? Do you oppose commercial real estate development which adds to the tax base, requires little in public services, and which therefore reduces the burden on the residential real estate tax payer and provides the locus for jobs for our citizens? One of our projects for which we built all the infrastructure, pays over $650,000 annually in real estate tax alone, requires no additional services, and therefore reduces the real estate tax you pay on your home. Now I am to understand that you oppose such development because we have made a profit on this development? Isn't that called cutting off your nose to spite your face?
Will Sessoms
No Mr. Barrett, Will Sessoms knows how to make sure the real estate developers get wealthy on the taxpayers dime.
Fun 'n the Sun
Well yes, some come just for the fun 'n the sun; but we the taxpayers would receive little benefit if the hotels/restaurants/retail stores were empty the rest of the year. Instead of over 3 million visitors, we would have only a million. The difference in attracting visitors all year round is the reason we all receive a fiscal dividend from the resort. Sessoms knows that and knows that creating economic development and jobs in every sector of our economy through quality growth and development is what the majority of our citizens want. (except of course for the VBTA that wants each of us to pay higher real estate taxes and not accept any more visitors). Will knows the hard work that goes into developing community support and consensus on a course of action, and he knows that only cities that create a strategic vision and strive to improve can compete with other cities and region.
There is but one compelling
There is but one compelling magnet drawing visitors to Virginia Beach, and that is that vast blue body of water known as the Atlantic Ocean.
It is not the Hilton, the free concerts, or all the ugly hotels which tower over the lovely beach and in the evening, create ghastly shadows.
It is our oceanfront, my fellow residents of Virginia Beach. Tourists are only here for a short time, while we residents, the local taxpayers, pay the property taxes, buy the cars, the appliances, purchase the services, plumbing, catering etc. as well as everyday supplies and groceries; these are the taxes that allow Virginia Beach to operate.
Moving east. The Town Center Food Court has cannibalized the exiting, non government-subsidized businesses. Do you think Town Center has not taken away business from the wonderful locally owned and operated Lynnhaven Fish House, Neighbors Pizza or the Peking Duck in the heart of Kempsville? If you don't think so, think again. These long-standing local businesses do not get taxpayer-paid parking, nor do they use your tax dollars for extra police protection.
The Town Center developers want Sessoms in their back pockets to continue running
More than one Issue - Vote John Moss
The 31st St. Hotel wasn't the only issue. "DEW" isn't running now.
Further Mike, you're slandering VBTA. Virginia Beach Taxpayers ALLIANCE.
VBTA has been crucial in putting pressure on council to lower property & other taxes. They advocate conservative spending rather than the wild spending on mega projects that Sessoms & Oberndorf both favor mentioned in the editorial.
VB has lost population, lost students(future labor cost), almost stunted the growth of a large employer with a tool tax, allowed compression pay problems with Police/Fire,and people can't afford to live here now. Most voters know that things have gone in the wrong direction for far too long now. Most know there's little difference between Sessoms and Oberndorf. Vote John Moss for Mayor!
Will Sessoms
A banker and a developers dream come true. Another taxpayers nightmare.