3 Council Colleagues Blow Off Special Meeting to Probe $160 mil Giveaway to Hotel Developer

By Matt Coker Wed., Feb. 1 2012 at 9:25 AM

Harry Sidhu

As expected, Anaheim City Council members Kris Murray, Gail Eastman and Harry Sidhu failed to show up to last night's special meeting regarding their votes last week approving nearly $160 million in bed-tax subsidies to the developer of two Disney Resort-area hotels.

About 75 residents and community activists showed up, but with no quorum to reverse, postpone or at least discuss the sweetheart deal for the GardenWalk hotel partnership, it is scheduled to go into effect today.

Tom Tait

Mayor Tom Tait, who called the special meeting a week after joining Councilwoman Lorri Galloway in opposing the tax giveaway, cautioned the audience not to read too much into the absence of their three council colleagues.

In fact, he noted that Sidhu was said to have undergone back surgery that day.

It's unclear whether Sidhu injured his back lugging the $6,800 in campaign cash GardenWalk hotel developers William O'Connell and Ajesh Patel arranged to have businesses give the councilman before the tax subsidy vote.

More on the deal and the events that led to last night's protest here:

Occupy-Type Protest Planned Tonight Over $158 Million "Bailout" for Anaheim Hotels

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Jason Sumague-Young

Love you article on this issue. I made a video highlighting the Anaheim City Council meeting in which this was approved.

http://youtu.be/vc-1Y-xfass

Guest

The people against this need to understand what kind of tax break the partnership is getting, and some simple math. The partnership is basically asking for an 80% reduction of the transit occupancy tax (TOT), which is like 10% or 12% for a 15 year period. That means the city is still getting tax revenue. Let's say a room is $100 and TOT is 10%. The city would still get $2. Now, how much would the city get if they don't build the hotels? $0. Which would you rather have?

909Jeff

What do the people expect to be done with that money? The purpose of a bed tax is to create a source of income to be spent on tourism marketing efforts, which in turn benefit the travel and tourism industry.

this sounds like a reinvestment into the tourism industry which is a HUGE source of revenue for the city and state.

20ftJesus

...and the creation of jobs. I've never understood what the OCW has against business. Of course, some backs will get scratched, but that's life.

Matthew T. Coker

Personally, I have nothing against business, although I do wonder if that area needs two more hotels while other city services aimed directly at residents are cut, cut, cut.

FishWithoutBicycle

Exactly what I was thinking...funny how there's always money to be found for new development and yet city services continue to be slashed...

FishWithoutBicycle

I'm not against business or job creation...but I object to just handing millions of dollars to a developer because they dangle the promise of increased tax revenue and jobs...

(Read the comments on yesterday's post...I elaborate a little more on the subject there...at least the jobs part...) :-)

FishWithoutBicycle

We have an open relationship... ;-)

909Jeff

I thought you'd be more upset that your boy is meeting his "Goomah" at the local hotel!

FishWithoutBicycle

Yes, one must break a few eggs to make a omelet...sounds reasonable. I don't claim to understand how the tax laws work...but I bristle at the idea that developers have to be enticed with tax breaks and other subsidies by the city they want to build in.

20ftJesus

"Of course, why would you stay at a hotel in the city you live in?"

Because that's where I meet the goomah for lunch.

909Jeff

You gotta spend money to make money...

What may be misunderstood about "bed taxes" is that they largely come from people who are not residents of the city. Of course, why would you stay at a hotel in the city you live in? Therefore they are directed to the local government to be used under their discretion to market and foster growth in the local tourism industry.

This would be a bigger story if they were diverting property taxes or sales taxes or any other tax funded by the resident tax payer. But very little of this money came from a resident of Anaheim.