Douglas County may be getting a posh resort hotel, but only if the Board of Commissioners are willing to leverage nearly $39 million in bonds to help seal the deal.
The 350-room Westin Hotel and Conference Center would be built on the grounds of the Foxhall Resort and Sporting Club in southern Douglas County.
The cost of the resort hotel, which would also have a golf course, is estimated at around $100 million. Foxhall is looking for the Development Authority of Douglas County (DADC) to issue the $38.99 million in bonds for an adjacent conference center, exhibition center and to pay for infrastructure improvements like roads and parking.
Representatives from Foxhall, the development authority and various consultants gave presentations and answered questions during a special called meeting of the Board of Commissioners Thursday afternoon.
Foxhall Chairman Harrison Merrill, Jr., said Westin expressed as recently as this week they’re “on board” and ready to operate the resort once everything is place.
Merrill said the resort is part of $2.5 billion in overall development eventually planned at Foxhall that would include additional hotels, businesses, educational institutions and residential buildings.
The commissioners didn’t make any decisions Thursday, but may take up the issue at a future meeting.
Chris Pumphrey, executive director of the DADC, said the commissioners would first pass a resolution expressing interest in the project but wouldn’t commit the BOC to issuing bonds.
“The resolution is really an inducement,” said UrbanIS Managing Director Charles Whatley, who has been consulting with the DADC on the project. “It gives you the right at a later day to issue bonds if all the other pieces come together.”
Ron Wilson, who chairs the DADC board of directors, pushed for an answer for why a public-private partnership like the one being asked for is needed.
Consultant Paul Breslin of Horwath HTL, said one reason public support is needed is because governments can capitalize on the future value of the resort by paying down the bond debt with taxes generated from the hotel.
Harrison Merrill, Sr., who owns Foxhall, said if the BOC passes the inducement resolution, he can start seeking investors for the project. He estimates it should take about 6-12 months to secure funding.
Pumphrey said the resort could be up and running by 2015 or 2016 if the county moves forward and everything goes smoothly.
Merrill said part of his optimism at the success of the project is that Foxhall already has over 100,000 visitors attending events from cross country races to weddings.
“No hotel ever has that,” Merrill said. “I don’t know of any example. Paul (Breslin) couldn't give me one in the country that’s had the people before the hotel. Normally you get the hotel and then you go out and get the people.”
Under the proposal, the conference center and exhibition center would be owned by the Development Authority of Douglas County, which would issue $35 million in bonds to pay for the construction.
However, Westin would operate the conference and exhibition centers as part of the resort.
The total cost of the bond Foxhall is seeking is $38.99 million when issuance costs and two years of capitalized interest are added to the total. That money would be payed back over 25 years, with an annual cost to service the debt estimated at $2.4 million.
Foxhall and the Development Authority project the county raising $5.4 million in additional tax revenues, including $2.7 million that would be available to pay the annual bond debt.
The $5.4 million does assume the county’s hotel/motel tax would be 8 percent. It is currently 5 percent. The county asked the state legislative delegation to change it to 8 percent earlier this year, but the bill died out as part of political wrangling over changes to the county Board of Elections. The BOC and state delegation are meeting next week to try to work out their differences on those issues and others.
Merrill said he understands the precarious position the BOC is in after recently passing an unpopular tax increase. He said he reached an agreement earlier this week with the hotel, which has agreed to pay any shortfall if the projected tax revenues don’t wind up being enough to cover the yearly debt on the bond.
But County Attorney Ken Bernard still had some concerns.
“Nobody is saying this is not a great idea,” said Bernard. “The question is this: Do we need it, want it, can we pay for it, can we justify it and what are our exposures? Because I don’t care who’s sitting at this table, there’s nobody that can say 100 percent the taxpayers aren't exposed and they're always going to be protected.”
Nick Byers, who sits on the DADC board of directors, is also President of the South Fulton Parkway Alliance, which has worked on economic development for the road that stretches 25 miles from the Douglas County border with Fulton County near Foxhall all the way to the Atlanta Airport.
Byers spends a lot of his time in south Douglas and is a big advocate for taking advantage of the proximity to the airport and the tax advantages Douglas has over Fulton County, which he believes could spur high-end growth in the area around Foxhall.
“We really have a new front door to our house,” Byers said. “And we need to open the door. Or at least look out the door and see what’s out there.”
Foxhall and the DADC are projecting $37 million in annual retail sales in the county, 390 permanent employees, $10.5 million in annual payroll, $556,000 in annual property taxes, $4.9 million in local sales taxes and $5.5 million in annual local government revenues if the resort is built.
Earlier Thursday, during the BOC’s work session, the commissioners discussed extending the county’s fire services agreement with the city of Douglasville until Oct. 31. County Administrator Eric Linton said the state requires the city and county finalize a long-term service agreement for fire and other services by that date.
Also, Bernard said he got word from Gov. Nathan Deal’s office that the special election for Clerk of Courts will most likely be a partisan race rather than a nonpartisan election as originally expected. The election will likely be held Nov. 5, but with potential runoffs, Commission Chairman Tom Worthan said he feared subsequent elections could drag the race out into next year.
Also, Douglas County Development Services Director Mark Teal asked that $8,039.80 form the Tree Fund be moved to Property Maintenance. Teal said there is $117,000 in the tree fund, which is paid into by builders and used by the county to put trees on county land. He said some of the money could be used to assist in landscaping around the sign at the new jail.
Records Administrator Becky Hebert asked the BOC to consider spending $44,783 to move the Records Department from the courthouse to the Blake Gammill Building. She said inmate labor could be used to lessen the cost, but it would likely take six months to a year rather than being able to complete the move this year if professionals are used.