A week ago, the Orange County Register published an editorial opposing the 4-diamond hotel incentive policy the Anaheim City Council will be taking up on Tuesday:
It’s beginning to seem as if Anaheim can’t even give away $158 million in subsidies for construction of two four-star hotels near the Resort District’s GardenWalk mall, as another deadline in the plan came and went last month.
In 2013, the Anaheim City Council voted, with Mayor Tom Tait in opposition, to allow hoteliers to keep 70 percent of the transit occupancy tax – or bed tax – generated for up to 20 years, after a 2012 attempt was met with legal challenges. But the agreement also came with some requirements, importantly, that breaking ground on the hotel “was required no later than May 26, 2015, and was to be completed within 30 months.”
The date passed without ground being broken, and one would hope that would be the end of the saga. But judging by the perseverance of the most recent attempts to give away the public purse, it is undoubtedly not the last we’ve seen of such proposals. And a recent council workshop on economic development will likely prove a worrying indicator of things to come.
The OCR editorialist claims the reason ground has not been broken is because the economic assistance policy isn’t working – an amazing claim because it ignores the actual reason, which is well known: left-wing advocacy group OCCORD and it’s left-wing attorney Cory Briggs have been tying the project up in court with a worthless lawsuit. It is difficult to credibly account for such a glaring factual omission by the Register.
You can read the rest of the editorial here, and below I have posted a response from the Anaheim Chamber of Commerce:
The Register’s commentary (June 7, “Tax giveaway can’t lure hotel to Anaheim GardenWalk”) on the effort to attract four-diamond hotels to Anaheim left out some critical facts that gave readers with an incomplete picture.
Most importantly, the sole reason that the GardenWalk Hotels have not broken ground yet is a series of frivolous lawsuits designed specifically to delay the projects. Despite judges repeatedly slamming the arguments and basis for these lawsuits, the plaintiffs have tied up these worthy developments in court; the very textbook cases of lawsuit abuse and need for tort reform for which the Register has editorialized many times. One might be puzzled by the Register’s seeming alliance with those who would use our courts to try to extort payments out of investors simply wanting to bring jobs and economic activity to communities.
With regard to a broader hotel investment and incentive policy being prepared by the City of Anaheim, our understanding is that Anaheim is in part trying to deliver on what both the Register and Mayor Tait have said they would support after the GardenWalk incentives were adopted. Twice before (February 7, 2012 and August 21, 2013), the Register opined its opposition to the tax cuts to spur hotel development in Anaheim because the proposal applied only to the two proposed GardenWalk hotels. Mayor Tait agreed, arguing on May 11, 2013 that “…one politically connected developer…” shouldn’t receive such incentives, and that it should apply to all developers.
The Council Members who supported the GardenWalk hotels and the thousands of jobs and hundreds of millions of economic benefit they would bring to Anaheim indicated they were simply supporting the only applicant before the City, and said they would support a policy to bring more four-diamond hotels to Anaheim that applied to all developers. That is the policy that city staff are now preparing to bring before the City.
The policy on its way to the City Council will accomplish what the Register has long argued for – lower taxes on entrepreneurs to spurn their investment in Anaheim. We hope the Council will support it.