Development of a boutique hotel in downtown Wichita will move forward. The Wichita City Council voted in favor of $7.5 million in tax incentives for the project. It passed five to one, with council member Michael O'Donnell voting against it. Mayor Carl Brewer was absent.
The vote came after almost three hours of discussion and comments from 36 members of the public. Of those public comments, 13 people spoke in support of the project while the rest were against it. Those against say it's not the project they're against, it's the use of tax dollars. The project include six different tax incentives.
Developers plan to invest $21 million to renovate the former bank building at Douglas and Broadway. The building, constructed in the 1920's once housed the famed Dockum Drug Store. Developers want to renovate the building into a 117 room hotel, 144 seat restaurant and 5,500 square feet of banquet facilities. It's the first project proposed under the new plan to revitalize downtown Wichita.
In return for the hotel, the city will spend $7.5 million on land acquisition, a parking garage and urban park. The city will provide a variety of tax incentives to pay that portion. The include tax increment financing, which means the increase in property taxes generated goes back into the project. Developers will also have a community improvement district, which means they'll charge an additional 2% sales tax to hotel guests. Industrial revenue bonds and façade improvements are also included in the incentive package.
Many argued that this project should go forward without the help of taxpayer funds. "They're doing it just to get the tax breaks. Look we need the tax money, the city needs the tax money," said Lynda Tyler. But Dick Honeyman then stood up and said he felt that if the project was possible without incentives, it would have happened a long time ago.
Developer Paul Coury says he couldn't afford the project alone. He says the combination of city tax incentives and state historical tax credits is what's allowing this hotel to move forward. Coury says it's so expensive to renovate old buildings and he needs to have a return on his money in order to proceed.
Coury says construction on the hotel should start in about 45 days. He says the hotel will open in December 2013.