Norfolk council is moving way too fast on hotel project

What is it about conference centers and hotel deals that make politicians hyperventilate?

Just wondering, because we saw signs of this odd phenomenon not long ago in Virginia Beach. It was late November 2011 when news leaked that Resort City honchos were secretly planning to spring a publicly subsidized convention center hotel project on the populace - right around the holidays - and hold a hasty vote on the matter.

Before opposition had time to organize, presumably. Alas, the taxpaying public was furious when it heard the news, and the project was ultimately axed.

I'm not a doctor, but in their blind hurry to rush a vote on a $126 million conference center and hotel project, Norfolk's City Council members also are exhibiting symptoms of conference center fever.

Think about it: These politicians were briefed on the project during a closed-door meeting just three days ago, yet they've scheduled a public hearing and vote on the complex deal - put together without the niceties of competitive bidding - for Tuesday.

A week later.

Even more troubling, The Pilot's Jillian Nolin reports that the agreement between the city and the developer, Gold Key/PHR Hotels & Resorts, has not been released despite repeated pleas from the newspaper. A city spokesman said late Thursday the agreement isn't even complete.

In other words, a panting City Council is about to blow roughly $89 million without first giving the taxpayers - or one another - a chance to study the deal and ask detailed questions.

This is what passes for good government in Norfolk these days.

"You want to strike while the iron is hot," Vice Mayor Anthony Burfoot said this week as he explained the hurried vote. "You don't want to have any undue delays on our part."

Someone needs to remind Burfoot - heck, I'll do it - that it's fine to spout cliches and dive into multimillion-dollar deals when it's your own money on the table. But when elected officials are committing the taxpayers to a complicated and perhaps risky project, they have an obligation to take their time.

Oh, and if the developer stomps his Gucci loafers and demands a quick decision, tell him to either wait or take a hike. After all, Norfolk's tossing about $10 million his way just for doing business with the city.

Taking time to wade through multimillion-dollar projects is called due diligence. And no one at City Hall - except Councilman Tommy Smigiel - seems overly concerned with that concept.

The councilman, who scheduled a town hall meeting for Monday night on the conference center deal, told me he has several serious concerns about the project.

"Why is this happening so fast?" Smigiel wondered, noting that the council normally gives more notice of public hearings. "Why are we not even following our normal procedures?"

Smigiel predicts there will be only one no vote on Tuesday: His.

"They've really been drinking the conference center Kool-Aid," he said. "I'm looking at the numbers, and I'm worried."

I hesitate to rain all over the Norfolk conference center parade, but several experts have warned that America's convention and conference business has been in decline for years. Even before the economy collapsed in 2007.

In a December 2011 Wall Street Journal article, Steven Malanga explained that in response to this drop, cities across the country built more extravagant centers and hotels, "arguing that whatever business remains will flow to the places with the fanciest amenities."

Late last month, the owners and management companies of the Waterside Marriott and Sheraton voiced their opposition to the conference center project, saying the hotel market was soft and the presence of a new publicly subsidized competitor would lead to "a rate war" during a period of economic uncertainty.

On Thursday, Ralph Izzi, an executive with the group that manages the Marriott, told Nolin that he'd like to see the vote postponed.

"No one is saying kill the project," he said. "What we're saying is, 'Take a deep breath, and make sure we're making the right decision.' "

A deep breath. The perfect antidote for hyperventilation.

Source : http://hamptonroads.com/2013/04/norfolk-council-moving-way-too-fast-hotel-project