By Craig Stoker
Recently there was a post on a social media blog discussing the potential for Odessa Development Corporation (ODC) to fund repairs and improvements to our aging water facilities. In the comments, sitting ODC board member Tim Harry continued to perpetuate the false narrative that because the city invested in a conference center and “other fancy projects,” our infrastructure has suffered “extreme neglect.”
I asked Mr. Harry to explain to me how the city’s investment of Hotel Occupancy Tax funds (HOT) into the conference center had any impact on the city’s infrastructure. Curiously in another comment on the same post he chided another community member for “pivoting” on the subject and very tersely tasked her to “try again with an actual argument containing facts.” I say curiously because the reply he gave to my question did not address how use of HOT funds took away from infrastructure and his facts were full of inaccuracies. Maybe they were alternative facts.
Whatever they were, and wherever their origin, many of the alternative facts he used are part of the false narrative that has been used to denounce the whole downtown redevelopment project for years. I took his alternative facts and provided correct answers to each of his points. I offered him the opportunity to again answer my question and at this time, two days later, there has been no reply.
I did want to take the opportunity to put this issue to bed. So let’s take one last, definitive look at why the Downtown Odessa Marriott Hotel and Conference Center project was a good investment for all of Odessa.
Mr. Harry began his argument by saying that the city had spent $55 million in HOT funds on the project, and he could not see where that was available in the budget. According to the City of Odessa website, the city’s investment of HOT funds was $31.6 million. This information was on the section of the website dedicated to Downtown Odessa, which has now been scrubbed, but it is available on other news sites. HOT funds are allowed to be “banked” for certain projects, the building of a conference center being one. According to the City’s 2015 Annual Budget Report, between 2006 and 2015 the city had collected $36,294,613 in HOT funds, which would more than cover their investment. The city’s 2016 budget report lays out that $27.3 million was restricted for the conference center project. Either way, the total HOT funds investment was nowhere near the $55 million Mr. Harry would have you believe and makes the $150 million figure ODC Chair Kris Crow has used to denounce the project seem even more outrageous. I’ll stick to the $31.6 million the city used to quote on its own website.
Point two Mr. Harry tried to make was that ODC funded the parking structure (infrastructure) for the hotel. This is true, and the parking provided by the structure is free and open to anyone needing to park downtown, not just hotel guests. I am not sure why Mr. Harry has an objection to providing infrastructure to support new development, when his own ODC board just voted to provide millions of dollars of infrastructure improvements to a retail development in Midland County. I thought his argument was about stopping dollars from being used on anything other than fixing our water system. I guess when it’s your idea it’s different. Also, I think the support of the development in Midland is a wise investment! Good job ODC!
Point three Mr. Harry tried to make, and it’s one of my favorites, is about the management agreement between the conference center and the city. Listen carefully and you’ll hear the Mayor get hot and bothered over this one too. “Explain to me how it is advantageous for the city to build a conference center, renovate a theater, fully furnish them and then lease them for $1 per year with no other returns?” Sounds like a no good very rotten deal, right? One dollar a year for all that? In one comment Mr. Harry would have us believe nobody goes there and what a failure the project is, but in another we are all getting hosed to the tune of $1 a year because of all the money they are making! Which is it?
Something they usually leave out of their false narrative story is that only because of a significant personal investment from arguably Odessa’s most benevolent couple, did this whole project even come to life. The hotel and conference center is a bright shining example of a P3, Public/Private Partnership. I’m assuming Mr. Harry supports P3s because I haven’t heard him complaining about the new Sports Complex the city just entered into a contract with the Centurion Foundation to build.
In fact, the agreement with Centurion will see the city issue $80 million in bonds to build the facility, which I was told would be paid for entirely with donations, but that’s neither here nor there. Once the facility is built the Centurion Foundation will hold a 99 year lease for $1 a year. (Que the shock and horror, oh wait, their idea = good idea, right?) But back to the hotel and their $1. Mr. Harry would have you believe the hotel is empty, except for maybe during the oil show. I am not sure is quite right, because looking at their Q1 reports to the state comptroller, they reported $2,469,216.21 in taxable receipts, which is $1.3 million ahead of the next Odessa hotel on the list. I’d say they are doing just fine. The White Buffalo and Barrell & Derrick are always doing great business. The Starbucks usually has a line. There is always a great energy around the hotel and I love that downtown continues to grow and evolve.
Point four Mr. Harry tried to argue was that it was unfair that the Marriott received a 10 year abatement from paying HOT funds. The actual deal with the Marriott was that the city would hold 100% of the HOT funds received from the operation of the Marriott for up to three (3) years to assist Eofficial in offsetting any losses arising from the operation of the hotel and conference center. So, from day one, the Marriott has paid into the HOT fund, and according to city records they never took any of the funds collected by the city. In fact, the Eoffs went to City Council to ask that $1 million be donated to the Odessa College downtown project. This donation is completely in line with their prior giving, and follows what they pledged to do with ANY profits from the hotel, invest them back into Downtown Odessa.
Side note, I am curious what Mr. Harry thinks about the 20 year sales tax abatement given to Bass Pro Shop though. Since the development is in Midland County the sales taxes were the only revenue Odessa stood to make from the deal since the ad valorem (property taxes) stay in Midland County. Speaking of ad valorem taxes, another false point that has been pushed by Mr. Crow is that the Marriott doesn’t pay property taxes. A quick search on the Ector County Appraisal District website shows that they have actually paid millions in property taxes over the years, which ACTUALLY go into the fund that pays for our water infrastructure to be fixed!
Point five Mr. Harry tried to make is that the conference center is too expensive and nobody goes there. This is just flat out false. Every event I have been to since the conference center opened has been there. I feel sorry for the Country Club! Now I will agree that it is pricey to host an event there, but because of the extreme generosity of Mr. and Mrs. Eoff, most of those costs are underwritten. If you go to most any event you’ll see that it is sponsored by the Marriott. The City gets to have a significant number of events there a year for free. The Ector has recently contracted with Live Nation and is bringing in acts that I never thought we’d ever see in Odessa. Maybe at the Wagner Noël, but never in Downtown Odessa.
Mr. Harry, maybe if you didn’t spend every waking breath badmouthing them you could get a sponsorship too. Quite honestly the Eoffs are so extremely kind and generous, and forgiving, I can almost guarantee they would happily sponsor the Boy Scouts or whatever event you said you could not afford to host at the conference center.
I have been accused of being a member of the swamp and I have even been told I was on the take because of the time I spend cheerleading for the hotel, but really all I want is to set the record straight that the city made a wise investment when they partnered with the Eoffs to build a beautiful facility, the likes of which Odessa had never seen. That building represents the Odessa we deserve. We deserve something nice to be proud of and support. We should all be grateful that the Eoffs, who could live anywhere, choose to stay in Odessa. They have given millions of dollars back to the community, and I am so grateful for their support and friendship. I wish we could all come together and see the value of each of the three economic development opportunities I talked about. All three will bring new investments to Odessa. All three will bring new restaurants and retail, which isn’t that what we all want? All three will create big gains to our HOT fund balance, ODC fund balance and General Fund balance, and ultimately that is the goal of economic development.
We’ve got to quit with the hateful rhetoric and blaming of others for the situations we find ourselves in now. Our infrastructure is a mess. Did that happen last night? No! Will it be fixed tomorrow? At this rate, no as well! I used to say to people that they were mad about the wrong things, and in this instance that statement certainly holds true. Mr. Harry is mad about the wrong thing. Unfortunately, in this situation I believe it is because we all need to look inward and be a little mad at ourselves, which is always really hard to do. We got into this situation because we demanded low taxes. Well, lower taxes mean fewer services, and so a valve that should be replaced every 10 years might be able to be pushed to 20, so let’s really test the limits and extend it to 50. But hey, at least we didn’t raise your taxes…
I’ll leave you with this, pothole money didn’t pay for the hotel. You are mad about the wrong things. Take a little time to learn about the different buckets of money involved in municipal funding. Eat at a local restaurant. Shop at a local store. Most importantly, let’s drop the keyboard warrior badges and start treating each other like we would in person.
Craig Stoker is Executive Director at Meals on Wheels of Odessa.
