Wednesday, February 27, 2013

A look back

The failure of Trenton's sole hotel has been a hot topic of late. The comments of former mayor Doug Palmer in this morning's Trentonian ratcheted up the heat just a bit. The wind blew hard from across the Delaware River in Yardley, PA as Palmer tried to paint a completely delusional picture of the hotel's value to the city.

Kevin Moriarty has a very good analysis of those comments in his blog post.

As students of history, we wanted to offer up some perspective on the hotel deal. Courtesy of the online, paid, archives of the Times, we have pulled up just a few articles from the mid-1990's to help refresh your memories. 

Let's start with an article written by Joseph Dee and published on October 31, 1995.  The article reports on a press conference held the day before announcing plans for an arena, hotel, conference center project on the Roebling/US Wire Rope site.

"The plan includes an arena that would be the home of a professional minor league hockey club, a hotel and conference center, a movie theater complex and some office and retail space." Dee wrote.

Describing the hotel and conference center, Dee reported the following:
"The hotel is slated to have 225 rooms while the conference center could handle groups of up to 800, Berman said. The hotel, estimated to cost $25 million, will be ''significantly nicer than a Budget Inn,'' Berman said when that company's lodging was mentioned for comparison purposes."
There was, of course, a caveat:
"Berman said the hotel would not be built if the arena is not. 'The arena is a feeder for the hotel and conference center. Visiting teams will feed the hotel. These two (components of the project) naturally fit and feed each other,' Berman said."

Even then, Palmer wasn't as gracious or grateful as he should have been:
"Mayor Palmer, who thanked Berman and his partners 'for this very bold and great move,' said he would prefer that a hotel and conference center be built closer to the downtown district. Regardless of the location, 'it's an idea whose time has come.'' Palmer said the project ''means jobs, business and other opportunities.' "

In a follow up story from December 20 of that same year, we learn that then state Senator Dick LaRossa was aiding and abetting Palmer's plan to build the hotel downtown. The story started off this way:

TRENTON _ Sen. Dick LaRossa, R-Ewing, threw a bucket of cold water on the proposal for a new sports arena in Trenton, saying the state will not fund it.
 His comments further roiled the waters surrounding proposals for a hotel- conference center and an arena in the capital city.  At this point, Berman had already changed the original plan.  Instead of building all three facilities, Dee reported that Berman "and other private investors would build the hotel and conference center only if the state pays for the proposed 10,000-seat arena, which he estimated would cost between $30 million and $40 million."  LaRossa, who sat on the budget committee, was insistent that the state would not finance the arena because it would not provide any returns to the stae.
LaRossa and Palmer favored the Lafayette Yard site for the hotel. Berman said he and his investors would not build a hotel on the Lafayette Street parking lot site, saying he believes it would fail there.

In the article, LaRossa argues his position this way:
''The state spends $900,000 a year on a conference center in Plainsboro _ that's money that could be rerouted to the city to finance a conference center. The state is only going to participate in a project that they'll get something out of, that will address a need. I am not about to support anything which is going to undermine the development of the Lafayette site.''

Palmer said:
''We've been working on the hotel and conference center for three years now,'' Palmer said. ''I respect what Ron Berman's trying to do, and he has been great, but this arena came out of the blue. Hopefully we can work with the state on an arena at the appropriate time.''

PALMER AGREED with LaRossa that the state would more likely help pay for a conference center. ''If the state supports the conference center, it would be getting something back. If it built an arena, it would be giving money away,'' the mayor said.

Then Mercer County Executive Bob Prunetti weighed in:
''My position is simple. I think the first priority has to be an arena. That will draw people to Trenton. Then we can let the private sector decide if and where a hotel should be built.''

On November 3, 1995, the Times published an editorial entitled Right mix, right place.

Included in the overall support for the Berman proposal was the following caution:

But remember: The project won't be the salvation of New Jersey's capital city. Yes, it will create hundreds of jobs, but it won't erase the poverty, stop the crime or change the school system. The city must develop solid programs in education, medical care, housing and economic development to deal with these problems.

And it should do so soon. Efforts should be made to ensure that local citizens get more than just a few part-time jobs selling hot dogs and programs and directing parking-lot traffic. There could be many opportunities for minority entrepreneurs to strengthen their role in the free-enterprise system.

Obvioiusly, the arena got built, but with county money. The hotel conference center got built, but by the city on the Lafayette Yard site.

There was one more twist in the tale. A developer from Harrisburg, Pennsylvania by the name of John Vartan had been in the mix off and on since 1994. Doug Palmer was courting Vartan to build the hotel downtown.

The Times' then business editor, David Newhouse wrote a piece that was published on April 9, 1996.

In the article, Palmer recognizes that the project will need "ongoing state support" while "other officials called it a serious mistake to interest any developer based on such requirements."

The article reports on a study done by state agencies that "envisioned a 165-room hotel with 17,500 square feet of meeting space and a multistory parking lot. It labeled the hotel at Lafayette Yard financially viable if it receives between 62 and 66 percent private financing."

Well, that private financing never happened, did it?

Here we are, 17 years later, and the "hotel at Lafayette Yard" is most decidedly not financially viable to us, the taxpayers.

We leave you with the following letter to the editor published in the Times of Trenton, January 4, 1997.

Mayor should support project

How is it that Mayor Palmer can so easily escape valid editorial criticism for not publicly supporting the efforts of private developer Ron Berman to build an arena and hotel-conference center at the Roebling Complex site?
I mention this after having read the interview of the mayor's 1997 forecast for the city of Trenton by Don Delany in the December 1996 issue of Mercer Business magazine.
Not once in the entire interview does Palmer mention the prospect of a major sports arena being built in Trenton. This obvious omission by the mayor clearly exposes his devious plan to promote his visionless hotel agenda, no matter what the loss in tax ratables and the cost added on to the taxpayers' bill. It is mind-boggling that this mayor is deliberately sacrificing this tax- ratable asset (not only for the city, but for the entire county) simply in order to satisfy his own ego.

Instead of genuinely supporting the sure-shot money-making and job-providing potential of a sports arena (and hotel conference center) at the Roebling Complex site, Palmer has chosen to be silent.

Of course, the reason for Palmer's silence is directly related to his competitive stance with Berman for state funding. Quite simply, he wants the money for his lame, long-shot fiasco; whereas, Berman needs the state of New Jersey's money for his sure shot _ a revenue-producing arena.

I hope the powers that be in both the state and county governments will wisely provide financing for the project or projects that will generate the greatest financial return.

Indeed, the mayor should support and promote projects that will most benefit the greatest number of his constituents instead of undermining the projects that will help Trenton financially.

This mayor owes his constituents an explanation as to why he is not genuinely supporting Berman's arena, hotel and conference center.

However, what is even more discouraging is that the media will probably avoid bringing this politically relevant'' question to light.

Joseph A. DeVito

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