Officials take heat on hotel bonds

Officials take heat on hotel bonds

November 30th, 2010 by Andy Johns in News

Staff Photo by John Rawlston/Chattanooga Times Free Press Barry Walston addresses members of the Walker County Development Authority as they take questions and comments about a bond proposal during a public hearing at the Walker County Civic Center on Monday.

ROCK SPRING, Ga. -- Walker County residents won't be on the hook for any of the $15 million in federal stimulus money being sought for a proposed hotel and conference center on Lookout Mountain, county officials told a crowd Monday.

What officials didn't admit until repeated questions from the crowd is that a property tax increase could be levied on residents to make up $36 million in bonds backed by the county if the development goes bankrupt.

"Is it the right thing to do for us as taxpayers to stick our neck out for a hotel?" asked Brian Hart, of Villanow, Ga.

Walker officials have only a few days to decide whether or not to approve a bond issue that would give the development $15 million in stimulus money to pay for part of the $51 million tab.

On Monday, about 50 residents flooded a meeting room at the Walker County Civic Center, expressing wariness of so-called "free money."

"Nobody's for this thing that I've talked to," said LaFayette, Ga., resident Jack Hart, who led the charge at the hearing for those against any public funding for the 150-room hotel and conference center.

The meeting began with county officials explaining that local residents would not be on responsible for the $15 million in stimulus bonds that would be issued to a collection of companies who want to build the project.

"The county has no obligation," said Don Oliver, the attorney for the Walker County "Not a dollar. Zero."

When Oliver first mentioned the property tax increase of 1 mill that's been pledged to back the remaining $36 million non-stimulus bonds, a murmur spread through the crowd.

Walker County resident Barry Walston said he's seen retreat centers and resorts across the country fall on hard times and said it was a bad time to start such a business.

"They're all in trouble," Walston said.

Development authority member Virgil Sperry said he couldn't guarantee a "screaming success," but said he is "confident that (hotel) has good prospects."

Oliver said the project could still fall through if investors don't support the project. If they do, he said, that's evidence that the hotel complex is a solid venture.

The county must decide whether or not to move forward by Sunday.

Contact staff writer Andy Johns at ajohns@timesfreepress.com or call 423-757-6324.