Hotel Deal Endorsed as “GOOD DEAL” by Citizens of Evansville Against a Taxpayer Funded Hotel

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Brad Linzy

Hotel Finally Seems Like a Good Deal

Evansville, September 26, 2013:

After weeks of wrangling over the details of a downtown hotel and after long, careful study of the most recent deal, the Citizens Against a Taxpayer Hotel are finally prepared to declare our general support.

Statements from Stephanie Brinkerhoff-Riley and John Friend as well as our independent study of the deal have indicated that the County Innkeeper’s Tax funds will only be going toward infrastructure and improvements to The Centre, not the hotel. This has removed one of our fundamental objections to this deal – the idea that hoteliers would be directly funding their competitors.

Furthermore, the reduction of the public costs to a maximum of $20 million, of which only $7.5 million will be for the hotel, is a vast improvement over the initial deal we were asked to support.
Although we will always prefer 100% private investment in private businesses, we understand the need for a convention hotel to support The Centre and feel that the current deal may be the only politically feasible deal on the horizon.

We would like to thank the six Council Members whose questions were instrumental in getting this deal reduced. We’d also like to thank the citizens who wrote letters, emails, made calls, and gave speeches against the initial deal. It is because of their pressure this deal was improved. Finally we’d like to thank the Mayor who ultimately found a compromise the people of Evansville could be proud of.

It is our hope that in the future our leaders will always champion proper vetting procedures and put the taxpayers first. We reject the notion that vetting businesses asking for public money makes us a “laughing stock”. On the contrary, this is the very definition of responsible government. We wish to welcome HCW to the Evansville business family!

Sincerely,

Brad Linzy

https://www.facebook.com/EvansvilleSaysNo

Citizens of Evansville Against a Taxpayer Funded Hotel

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36 COMMENTS

  2. Congrats to all involved for their diligence. The vetting of businesses is always the prudent thing to do. Where the Council/J Friend stepped out of the box & SOP was when HCW principals were asked to disclose personal financial information. If an individual was contemplating investing monies with John Friend Company and, prior to a final decision, wanted to see Mr Friends personal financial information, my guess is those monies would be invested elsewhere. Just sayin…….

    • Anyone who would invest with a company without checking to see if the founders have an ethical history is a fool. The only reason the personal vetting is not necessary is because a bank in Missouri and ONB will be checking into the backgrounds of these people. The city will not put up its money without HCW getting loan approval and showing their down payment. I guaran-damn-tee you the bank will do a financial strip search on the company and the people before funding this deal. If you think differently then you either don’t know what you are talking about or are spinning. The only job you can get now without a background check is an elected job.

    • It was. The point is that asking for HCW principal’s personal financial information is definitely not standard operating procedure. Would Mr Friend disclose the same to a potential client of his business? Probably not……….

  4. Brad Linzy,

    How can it be a good deal if there was NO vetting ? Better to flush $ 20 Million down the drain than $ 37.5 Million–is that what makes it a “good deal” ?

    By quitting now–and not going through the vetting process–the City and the City Council are left, still, without a system, a mechanism, for vetting these large deals. By caving now . . . HEAVEN HELP US ALL when the non-vetted CSO contracts start spewing forth towards the favored sons of the City. Very disappointed in the Council.

    • Chill. Then go look at HCW’s website. They have lots of large projects all over the country. They aren’t some amateurs. This whole vetting talk is silly anyway. They were vetted in the beginning as were all the original firms that applied in the current deal to the farthest extent any company would allow. If you think you are going to get any business to open their financial books to the city, you’re kidding yourself.

      If you think this $20mil is just being flushed down the drain, you are a moron and have very little vision for the future of our downtown and city as a whole.

    • We have been assured by several council members that a deal will still be contingent upon vetting through the bank that issues a loan.

      Anyone who thinks vetting is unnecessary or that John Friend was out of line is not being realistic. The City Council has every right to ask for whatever information they wish in order to vet a candidate asking for public funds.

      We hope in the future, a formal process of vetting is put in place so no single council members are demonized for insisting on vetting. This is one area where the Administration fell down here. We hope everyone takes a lesson from the shortcomings of the way this was handled.

      • Well, I can see that it is no different on here than on the C & P; you always have a few that know everything. (1)I never said that vetting was unnecessary & (2)I never said that Friend was out of line. I said that the asking of personal financial info, in a situation like this, was not standard operating procedure. The Council has the right to ask for anything, but getting it is another situation. Friend just happens to be out of his league.

          • This hotel project has always been somewhat of an emotional subject, with those emotions accelerating the past few weeks. Hopefully none of us mean any comments as a personal attack. I do not. Today the hotel, tomorrow(hopefully soon)IUMS-Evansville. IMHO, the hotel is an extra-base hit, the med school would be a home run. My biggest concern is that the school will be built in the Warrick county area around Gateway. Hopefully not.

          • No personal attack from my end. Even when they happen, my attacks aren’t personal. Ask Wayne Parke. I like him personally, but we staunchly disagree on most everything else.

  5. One last add: how can approving $ 20 Million with zero vetting and no business plan be remotely considered GOOD STEWARDSHIP of the PUBLIC’s MONEY ????

    • There WAS vetting, it stopped short of receiving HCW principal’s personal financial info.

      • Come on, man, you are wrong. The long list of due due diligence items requested was never provided. The HCW principals’ personal financials/tax returns was just one of around 30 or so documents requested. It was the job of Crowe-Horwath to obtain and review those documents. Because HCW put conditions on the documents and the report, Crowe had to withdraw.

        • No, I am not wrong. There was numerous items on the requested list that was provided. In a situation like this, the disclosure of the principal’s personal financial info is not standard operating procedure. You can always ask for it, but getting it………….

          • Comeon,

            Please post the specific due diligence documents requested which were tendered to a member of the City Administration or City Council. Please name names, and also tell us how you know.

        • According to your post of 2:58 today, you stated that the personal financial/tax returns were just of 30 or so that were requested. It seems that YOU know more than anyone the documents requested. Please share your wealth with all of us.

  6. ” GOOD is the enemy of GREAT”.

    The opposition to the project must continue until we have a formal mechanism for vetting a large project in place.

    • The business plan request was answered by an arrogant:
      WE ARE THE BUSINESS PLAN!
      How can this be categorized as a “good deal” at this point? …

  7. “Furthermore, the reduction of the public costs to a maximum of $20 million, of which only $7.5 million will be for the hotel, ……….(Brad Linzy)

    * * * * * * * * * * * *

    It is ALL for the hotel, all $20.million. No hotel? No need for any of this money.

    ___

    • I agree. I have considered this point as well. The only way I can view this and make it palatable is to see that the city will own the parking garage, which will serve the Centre and Ford Center both. One of the two additional skywalks will serve to connect the Ford and the Centre.

      This is by no means an ideal proposal. You and I know that, but to fail at this point to see the progress that has been made and declare some measure of victory for our efforts is to risk appearing unreasonable and unwilling to hold our noses and compromise.

      We can also take heart because this hotel fight has ensured future spending proposals will be tightly monitored. The Mayor has burned through all his political capital on this one. His dog park will be gone. The $25 million for the zoo will be gone. Cuts will be coming to the budget.

      These are the residual victories we will have claimed because of this hotel compromise. Try to see the bigger political picture.

      • “We can also take heart because this hotel fight has ensured future spending proposals will be tightly monitored.” (Brad Linzy)

        * * * * * * * *

        Brad:

        Your statement reveals a certain amount of naivete. Tightly monitored by whom?

        If you really want to get a handle on this you will have to take the Jerry Brown route and abolish the redevelopment commission.

        Now there is a campaign we can all get behind!

        ___

  9. I can tell you there are a great many people in this town who are extremely angry with the John Friend, Dan Adams, Stephanie Riley and Conner O’Daniel for having the unmitigated gall to question the merits of this deal. And no they’re not union members or others who might benefit from the hotel’s construction.

    They still insist the orignal deal was a great one and that John Friend was WAY out of line in asking for pro-forma financial statements etc. The responsible six were called Jackasses, anti-growth, anti-Evansville, regressives, and worse on FB. They also said The vetters(meaning us) could go %&** themselves and so on. Further, Mosby, Weaver and Winneke were praised to the hilt, saying they’re the ones who came up with the deal in the first place and the skeptics deserved NO credit. (eye roll)

    These folks were ready to hand $37.5 to an out of town developer sight unseen. No I don’t think this was a tiny vocal minority.

    Here’s the problem, a horrible precedent has been set and THEY WILL BE BACK. The hotel will lose money and this crowd will blame the lack of apartments, or retail space, or grocery stores, or restaurants or whatever for its failure and they will want ANOTHER multi-million dollar project and it will be touted as the difference maker.

    SMH

    • Brains Benton: The good news you got the 1st three paragraphs correct. Then you wondered off and made a bad turn.

  10. ADVERSE COMPETITIVE EFFECT

    IC 36-7-12-21
    Negotiation of financing terms; adverse competitive effect studies; preliminary expenses
    Sec. 21. (a) An economic development commission may enter into negotiations with one (1) or more persons concerning the terms and conditions for financing of economic development or pollution control facilities.
    (b) The commission shall consider whether a proposed economic development facility may have an adverse competitive effect on similar facilities already constructed or operating in the unit. In the case of economic development facilities that are identified at the time of issuance of the bonds, the adverse competitive effect question must be considered before issuance of the bonds. In the case of a program financing under section 18.5 of this chapter, the adverse competitive effect question need not be considered before the

    issuance of the bonds except for those economic development facilities that are identified at the time of issuance of the bonds, but it must be considered before financing any proposed economic development facilities from program funds.
    (c) Preliminary expenses in connection with negotiations under this section may be paid from:
    (1) money furnished by the proposed user or developer;
    (2) money made available by the state or federal government, or by any of their departments or agencies; or
    (3) money of the commission.
    As added by Acts 1981, P.L.309, SEC.31. Amended by P.L.25-1987, SEC.49.

    ___

    • BTW, this is an excellent example of why government should stay out of the marketplace.

      I will say it again: Government should not be determining the winners and losers in the marketplace! When government does this, it opens itself to charges of cronyism and corruption.

      ___

      • Can you say Affordable Care Act???

        Truer words where never spoken – “this is an excellent example of why government should stay out of the marketplace.”

  11. You might look at the deal which was assembled for an 87 year old hotel in downtown Bradenton, FL (not in the resort areas at all). The county incentive to do this was $125,000 with payment “AFTER” the project was operating over the next two years.

    Upfront payment deal and the percent of public funding remains crazy in comparison to others. Oh, by the way, look at the project history on this and Dunn Hospitality early involvement before another group came in and actually did it right.

    By the way, it is almost done. Should be open in a month or two.

    http://www.heraldtribune.com/article/20130908/ARTICLE/130909672

    • Could they come up here and rescue the historic McCurdy Hotel?? Great post by Friendly Reminder. Nice to see all the new CCO Posters after the left wing C&P demanded more identification from posters than they want “voters” to show at the polls.

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