Baton Rouge Metro Council says no to tax subsidy for proposed Marriott hotel downtown _lowres

Advocate staff file photo by TRAVIS SPRADLING -- Parking lot at Florida Street and Third Street in Baton Rouge is the site of a proposed Courtyard by Marriott hotel.

For the first time, the East Baton Rouge Parish Metro Council refused to award a tax-relief incentive to a new hotel — and now the fate of the planned Courtyard by Marriott in the heart of downtown Baton Rouge is unclear.

The hotel is proposed for the corner of Third Street and Florida Street, currently a parking lot, with developer Bo Aughtry, of Windsor Aughtry Hotel Group, attached to the project.

The move Wednesday is an indication that some on the Metro Council feel it’s time for downtown redevelopment, which has benefited from various public subsidies, to stand on its own.

The hotel was asking for help in the form of tax-increment financing, commonly referred to as a TIF, which rebates local and sometimes state sales taxes paid on rooms and goods back to the hotel to help cover construction costs. The proposed TIF would have been only for the 2 percent local sales tax collected by the city-parish.

Aughtry, who also is the developer behind the downtown Hampton Inn and Suites, said following Wednesday’s vote that it is unclear if his firm, Windsor Aughtry, will move forward with the project.

“Given the city’s position, we are evaluating if we will proceed with the project,” he said, declining additional comment.

The Metro Council has previously approved either similar or more-generous TIFs for five other downtown hotels, dating back to 2005 when the first one was awarded to the Hilton Baton Rouge Capitol Center. That TIF is the most generous. Every year, it rebates to Hilton about $900,000 that otherwise would help fund government operations.

Since then, Hotel Indigo, Hampton Inn and Suites and the newly opened Holiday Inn Express all received TIFs. Elsewhere, the Renaissance Hotel on Bluebonnet Boulevard also received a TIF.

Most recently, the Metro Council approved a TIF for developer Mike Wampold, who is opening another Marriott hotel on Third Street, a few blocks from where Aughtry’s development is planned.

Downtown developers have argued that it’s difficult to get financing in the area, which is still in the midst of being revitalized, especially because they are frequently renovating historic abandoned buildings, which can prove to be expensive projects.

While Aughtry’s project wasn’t a renovation, downtown leaders have argued the incentive was needed to help offset the cost of renting parking spots in garages, whereas locations outside of downtown Baton Rouge can have their own lots.

Council members Chandler Loupe, Joel Boé, Tara Wicker and John Delgado voted in favor of the TIF. Trae Welch, Chauna Banks-Daniel, Scott Wilson, Donna Collins-Lewis and Ryan Heck voted against it. Ronnie Edwards, C. Denise Marcelle and Buddy Amoroso were not present for the vote.

For years, downtown and tourism leaders have been working toward a goal of more than 1,200 hotel rooms downtown to attract more high-profile events and conventions to the River Center.

The planned Courtyard by Marriott, if built, would add 135 rooms downtown. If it doesn’t happen, then downtown Baton Rouge would still have 1,031 rooms after Wampold’s other Marriott is built in 2016.

Welch said TIFs are needed to revitalize areas but he thinks downtown Baton Rouge has sufficiently been given a boost. Through TIFs, downtown Baton Rouge has gotten close enough to its room-supply goals, he said, adding that he is weary of continuing to approve measures that deprive the city-parish of much-needed tax dollars.

“Ultimately, by some people paying less, everyone else pays more, because we still have the same needs,” he said in an interview.

He said he isn’t concerned about the threat of losing the project.

“We’ve got hotels now,” he said. “If that’s the deal, then the market wasn’t there to begin with.”

Ahead of the vote, some hotel industry representatives questioned whether the addition of another tax-subsidized hotel is necessary, considering the soft demand for hotel rooms downtown.

Aughtry even wrote a letter to Wampold asking him to consider changing his project concept, suggesting the market isn’t big enough for both of them.

“We will all be damaged with added room supply in a market that already suffers,” Aughtry’s letter says.

Wicker, whose district includes downtown, said the project will be an asset to downtown and she hopes it moves forward.

“Right now, it’s a vacant lot; it’s underutilized,” she said. “I thought it would be an asset to the community, and I’d like to see the property redeveloped.”

She said she understands that downtown will reach a point where subsidies are no longer needed to kick-start projects but she doesn’t think they’ve hit that mark yet.

Follow Rebekah Allen on Twitter, @rebekahallen. For more coverage of city-parish government, follow City Hall Buzz blog at http://blogs.the advocate.com/cityhallbuzz/.