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Changing Courses, Broken Arrow, Oklahoma Now Looking to Private Investors
for Hotel Conference Center:

Plan Would be Supported with Sales and Hotel Tax Breaks

By Susan Hylton, Tulsa World, Okla.McClatchy-Tribune Regional News

Apr. 7, 2010--BROKENARROW -- The city is moving forward with an alternate plan to build a hotel conference center that would be privately financed this time, but boosted by sales and hotel tax breaks.

City Manager David Wooden said the city had been "up several roads" on how to develop the hotel conference center but that the latest plan would allow a private company to move the project forward.

"What we're trying to do is make it a private project and entice someone to do it," Wooden said.

Councilor J. Wade McCaleb stressed caution with the handling of the sales taxes generated by the development.

"We need to be careful we don't overextend and give up too much," he said.

The hotel conference center proposal originally was approved by voters through a general obligation bond issue in May 2004.

But the $15.5 million design estimate came in at more than twice the amount of the $6.575 bond package approved by voters.

In August, the city went back to voters to see whether they would be willing to fund an additional $8 million for the project. Voters said no.

A review committee has been studying alternatives since September.

Their first recommendation is to let the developer finance and construct the conference center with the added incentive of a hotel/motel and sales tax-increment financing, or TIF, district.

A TIF district is an economic-development tool that allows cities to divert taxes in a particular area

from their normal purpose to use for projects that stimulate investment in that area.

On Tuesday night, the City Council authorized Wooden to begin negotiations with Stoney Creek Hospitality Corp.

Stoney Creek is the only company to have responded to any of the city's requests for proposals during the process.

Part of the negotiation with Stoney Creek would deal with the amount and duration of the TIF.

Wooden said only the sales and hotel taxes from the hotel conference center would be diverted to the project.

As for the funds approved in the general-obligation bond, Wooden said it simply wouldn't be activated. Voters would have to be approached if the city wanted to use the funds for another project, Wooden said.

Susan Hylton 581-8381


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