No Honeymoon Suite For These Two at Convention Center Hotel
Earlier this morning, Unfair Park mentioned that during tomorrow’s Economic Development Committee meeting, council members will discuss spending $41.3 million of taxpayers’ money to acquire land upon which Mayor Tom Leppert wants to build a convention center hotel. Two items related to the property were approved Wednesday, with council members Mitchell Rasanky and Angela Hunt as the only ones in opposition. So it looks like this baby will be slipped in as an addendum to the February 27 agenda meeting.
Problem with that is, like, aren’t they supposed to ask the taxpayers first?
“If, at the end of the day, Dallas residents are responsible for this debt, why is it that we would work some type of financial magic to keep the voters out of this process?” Hunt tells Unfair Park today. “I don’t quite understand how it is that you can issue bonds for an enormous project like this without seeking voter approval.”
The financial magic Hunt refers to is the city refinancing the Dallas Convention Center, which still has approximately $260 million of debt left on it, to buy the 8.4 acres of land from Cincinnati-based CP-Dallas L & Y LP. Hunt says she doesn’t understand how this is legal and will be asking Dallas City Attorney Tom Perkins that very question.
I also talked with Rasansky this weekend, and he said several times that “this is wrong” and that he's “extremely upset” and “not happy” about the city’s rush to get this done without all the evidence. Rasansky said he tried reasoning with Leppert, but he wouldn’t listen. He also said none of the council members would listen to his concerns -- except, of course, for Hunt.
Like Hunt, Rasansky is frustrated that he hasn’t been given all of the information. He says some of the most basic questions haven’t been answered, such as the final cost of the hotel (which Rasansky said could be between $500 and $600 million) and, more importantly, how much this will ultimately cost taxpayers.
Armed with “plenty of articles and stats,” Rasansky says he’s been told by several prominent real-estate people that this idea is “insanity.” He also mentioned the name of Dr. Heywood Sanders of the University of Texas at San Antonio, who is considered the leading independent authority when it comes to convention centers, and said the council needs to hear from him on this issue. “I’ll pay for his way outta my own pocket if I have to," Rasansky says. "This man needs to speak.”
Hunt says hearing from Dr. Sanders is exactly what is needed, insisting the council often hears only one side of an issue -- the one supported by city staff. “Let us ask him questions," she says. "What would be the harm in that? We’d get too much information? When is that a bad thing? I’m thrilled that Mitchell is proposing that, and I hope the city will take him up on that very generous offer.”
Both Hunt and Rasansky expressed concerns about the significant gap in the appraisals of the land compared to DCAD’s value when the council voted on this issue Wednesday. Here’s a shocker as to why the appraisals were so high: They were done assuming a convention center hotel was already built on the property!
Now I’m not a real-estate guru, but Mitchell Rasansky is after 45 years of building thousands of multi-family units in Dallas, and he says this is not how business is done. “When I buy property," he says, "I want to know what it’s worth now, not when something else is on it.”
Rasansky is concerned that of the two appraisals, both came out at the same amount, which he says is very unusual. He also didn’t like that one of the appraisals was from someone in Fort Worth. “I didn’t sleep for two or three nights before the Wednesday vote on this," he says. "Unfortunately, I take this stuff home with me.”
Hunt says she’s surprised the city is moving so quickly, especially since the council doesn’t have enough data to proceed: “I continue to hear that I’m going to get information, and I continue to wait for that information to materialize.”
Just what the heck is going on here? Well, certainly Leppert and Ron Natinsky, chair of the Economic Development Committee, are moving as fast as possible to slip this one by the citizens of Dallas. And we know Belo won’t be taking issue with this since this will help their property values immensely. “This will help Belo, obviously,” Ranansky said. “You’d have to be blind not to see that. Now they’ll have a comparison price for their property.”
I’m keeping my fingers crossed that Dr. Sanders somehow makes his way into a committee or council briefing. When I talked to him in September, his view of the risk associated with building a convention center hotel led me to write, “If Mayor Leppert and the council really want to be educated on this issue before moving forward, I urge them to contact an independent party to present them with all the facts so that Dallas can avoid becoming like everyone else -- stuck with a publicly funded hotel that isn’t meeting expectations.”
There’s a reason why Dr. Sanders hasn’t been contacted by the council. The truth often gets in the way of the aspirations of politicians. Leppert and Natinsky are betting that getting this done will yield them untold political fortunes. If talking millions from taxpayers without their permission is the only way to accomplish this, then so be it. --Sam Merten