[EDITOR’S NOTE: For reasons I don’t understand, when a reader clicks on the title of a post to read the full post, the byline disappears, which often leaves readers confused as to the authorship of the post. To allieviate that confusion, going forward I will insert an editor’s note at the beginning of posts not written by yours truly to clarify the authorship. In this case, it is Anaheimocrat.]
Something seemed off when I read yesterday’s OC Register editorial on the GardenWalk project (which the editorial writer mistakenly believed to be on tomorrow’s council agenda), so I searched out last year’s OCR editorial opposing the agreement and compared the two.
In the February 7, 2012 editorial, the Register blasted the TOT rebate as “an outright subsidy;” that criticism was nowhere to be seen yesterday, but instead commends the Anaheim City Council for seeking a policy “growth and economic development for the city.”
The editorial up-dated its call for applying this tax incentive evenly. I say updated because last year the OCR’s proposed alternative was lowering the TOT tax for all Anaheim hotels, which also showed the writer didn’t really understand the policy he was criticizing. The writer said the GardenWalk TOT rebate agreement was unfair to existing Anaheim hotels.
A year later, the OCR editorial page is instead recommending the City Council adopt a uniform tax rebate policy for new developments, not just hotels. Of course, this would exclude existing hotels, which an about-face from last year when the OCR denounced the GardenWalk agreement partly on those grounds that existing hotels didn’t get the same subsidy.
The OC Register’s claim that the GardenWalk deal is favoritism is still doesn’t reconcile with the facts.
Yesterday’s OCR editorial recommends the City Council establish a uniform policy on TOT rebates to new hotel developments – which is something the City Council did several years ago. The O’Connells are the only hoteliers who have gone the distance under this policy. It’s true that the TOT percentage split is different than the original policy, but that was a change made in the facde of changing market condition. It wasn’t favoritism just because the O’Connells were the only ones still pursuing a luxury hotel development, which was the whole point of the original policy set by the city council. The 80-20 split was denied to other hotel project or negotiated with the O’Connells out of “favoritism;” they were the only developers moving a luxury hotel project forward.
The OC Register’s call for the City Council to “table” the GardenWalk agreement is truly wrong and capricious, and shows a real lack of understanding. The O’Connells have worked with city staff for many, many months and in good faith to work out a mutually beneficial agreement. They have carried and incurred great costs throughout this process. It is very difficult to keep investors and creditors on board through a process that has become has become as unpredictable and politicized as this one. To follow the OCR’s advice and arbitrarily junk the GardenWalk agreement would be unfair and send a message to anyone looking to invest in Anaheim that the city is an unreliable partner.
The persistent errors in the OC Register editorial stance aside, their shift embracing a city-wide policy of TOT rebates as a business development tool is one that is as welcome as it is surprising.
UPDATED: according to a reader, yesterday’s editorial represents a more significant shift than I knew. In 2008, the OC Register blasted the original 50-50 TOT split offered to anyone willing to build a luxury hotel.
Ironically, the OCR is now recommending a more generous version of policy it was denouncing five years ago.
The question is: if the Anaheim City Council follows the OC Register’s advice and adopts a policy applying the specifics of the GardenWalk agreement to all new hotel developments, will it publish an editorial praising the action?