After NASCAR Hall vote, Bojangles’ Coliseum proposal to face tough questions After a week in which two of the city’s highest-profile deals with corporations have gone sour – the NASCAR Hall of Fame and Chiquita’s relocation – executives with a company seeking to build an amateur sports complex and hotel at Bojangles’ Coliseum with the help of city money are likely to face tough questions. Florida-based GoodSports is scheduled to present its plans and financing options to Charlotte City Council’s Economic Development subcommittee Thursday afternoon. GoodSports is seeking $25 million from the city to help build the complex and hotel. But GoodSports has had to delay its Charlotte plans already, and last week the company delayed its plans to build a similar complex in Wichita, Kan., because of difficulties lining up financing. A GoodSports representative didn’t return a message seeking comment. The company’s presentation will come days after City Council voted to write off more than $22 million in debt for the NASCAR Hall of Fame. The hall couldn’t finance the debt because of poor performance, and Wells Fargo and Bank of America agreed to forgive most of the loan. Then, on Wednesday, Chiquita said it plans to shutter its Charlotte headquarters, costing the city about 320 well-paying jobs. Chiquita was lured to Charlotte in 2011 with about $22 million worth of state and local incentives. The city and county paid the company $1.02 million in incentives, and the two governments said they would get their money back. GoodSports is likely to face stepped-up scrutiny about the proposed public-private partnership. “What I’m trying to make sure of is GoodSports and their partners and funders can get the project off the ground,” said Michael Barnes, chairman of the Economic Development Committee. “We cannot put ourselves in a position where we have another partner who can’t produce.” Of GoodSports’ delays in Wichita, Barnes said: “That will be a topic of conversation.” Deputy City Manager Ron Kimble said he isn’t concerned about how GoodSports will be received. “I do not have any concerns about presenting GoodSports,” said Kimble. “It will be judged and should be judged on its own merits.” GoodSports told council members in December that its Wichita project was ready for construction and that Charlotte would soon follow. “I dont think our track record to date has been very good in these type ventures,” said Kenny Smith, the only council member to vote against the NASCAR Hall of Fame debt forgiveness. “I hope as a council and as a city we will try to place scrutiny on all of these deals.” “As you look at the NASCAR Hall of Fame and some of our other failures, it sort of reinforces the notion that government should really stick to what it knows best, such as public safety and infrastructure” he said. The proposed amateur sports complex would be financed differently from the NASCAR hall. But both depend on business forecasts being correct in order for the projects to succeed. In most public-private partnerships, the city agrees to refund a portion of property taxes to a business after it completes a project, whether it’s an expansion of an existing business or a relocation. The city has long said this minimizes risk. The main reason: If the project isn’t built, the taxpayers aren’t on the hook. But the tentative proposal with Florida-based GoodSports calls for the city to invest $12 million in Bojangles’ Coliseum along with $25 million into the proposed field house and hotel that would be built in the parking lot of the coliseum. The city’s money would go in at the front of the deal – not at the end. If the project fails, the city could be stuck with a closed hotel and field house and no one to run it. GoodSports believes its hotel and field house can capture business for youth tournaments, such as basketball and volleyball. But the hotel’s prospects aren’t as clear on weeknights, when fewer youth sports events would be scheduled. The $25 million for the amateur sports complex would not be a loan from a bank. It is part of a nearly $900 million capital improvement program approved by City Council in 2013. That program is backed by a 7.25 percent property tax increase. Search for Eastland developer The city is also trying to find a private developer to help develop the 80-acre Eastland Mall site. The city cut ties in 2013 with Bert Hesse, who proposed building movie studios, offices, retail and apartments on the site. The city never got far enough in negotiations to determine whether its share of the project would have gone in before or after construction. The city said it will release a study in February from a consultant about what could be done next with the site. In the wake of the NASCAR deal, some critics have cited the Whitewater Center, which asked its lenders to forgive two-thirds of its $38 million debt in 2010. Local governments – including the city of Charlotte, Mecklenburg County and Gaston County – invested in the facility, agreeing to pay the center $12 million in “service fees” over seven years. Charlotte’s annual payment was $200,000. The city has long said it felt that amount was a bargain in return for having a tourism draw and recreation facility for locals. It’s unclear whether there will be another project such as the NASCAR Hall of Fame, which was conceived before the recession, when the city’s two largest banks were flush with profits. After Wachovia was sold to Wells Fargo, and Bank of America began reorganizing because of fallout from its Countrywide acquisition, some have worried that the banks won’t play as large of a role in the building of the city. At Monday’s council meeting, Democrat Patsy Kinsey went out of her way to thank the banks for their contributions to arts and culture, and social-service projects. Kimble said at Monday’s council meeting that he doesn’t expect the NASCAR deal to affect the city’s relationship with Bank of America and Wells Fargo. Because the banks were willing participants in the deal, there will be no negative impact, he said. Read more here: charlotteobserver/2015/01/14/5447439/after-nascar-hall-vote-bojangles.html#.VLfy2ivF_11#storylink=cpy
Posted on: Thu, 15 Jan 2015 17:04:53 +0000
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