MIDLAND, Texas — The Hotel Santa Rita took a crucial step forward to becoming a reality at Monday's Midland Development Corporation meeting, when the board voted to approve a $45 million contribution towards the project.
This isn't the first time that Downtown Midland has tried to secure a hotel for the downtown area.
According to MDC Chairman Lourcey Sams, the reason this hotel is different from the others is because the hotel's investors have the capital to make it happen.
“In the past they were all looking for a debt component," Sams said. "At this particular time, you have a lot of community leaders, a lot of high net worth individuals from Midland and foundations that are contributors to the city of Midland that are putting up the majority of the money to build this project.”
This backing gave MDC enough reason to greenlight the contribution.
However, this hotel has stirred up a bit of controversy on various social media sites, specifically because of the money MDC is giving and the potential impact it could have on Midland's taxpayers.
Along with the contribution, an incentive-laden package would also go towards the hotel - which is another topic of controversy among Midlanders.
That incentive package will need to be approved by Midland city officials at Tuesday's city hall meeting.
"The incentive package does not come from MDC, the MDC just committed $45 million cash," Sams said. "The incentive comes from the City of Midland, which is tax abatements and tax rebates over the life over a 10-year-period of the project, which is approximately $15 million."
This potential for tax dollars to be involved is what spurred some members of the public to Monday's MDC meeting, questioning whether or not MDC did their proper homework.
The MDC board was also questioned about how they chose the Hotel Santa Rita project in particular.
"The MDC and the City of Midland put out a request for proposal RFP project," Sams said. "Three members of the MDC and three members of city council were on that committee that vetted through all the various proposals and scored them. The Santa Rita won out."
While many people agree that the hotel would revitalize Downtown Midland in a positive way, the thought of tax dollars being used makes many wary of the project.
“Anytime that you take a Midlander and you tell them 'hey, we're gonna get $45 million plus tax abatements of your money to somebody to build something,' everybody should be at caution," John Burkholder, president of Burkholder Holdings LP, said. "That's your money that you've paid into it and you should get involved to make sure that your money is being put in the right place at the end of the day.”
Final approval of the Hotel Santa Rita project will be made at Tuesday's city council meeting, which will be at 10 a.m. at City Hall.