City Panel Delays Hotel Subsidy Plan
Faced with objections from labor leaders and the threat of a lawsuit, a City Council panel delayed action Tuesday on a plan to provide $150 million in subsidies and loans for a 55-story hotel across the street from the Los Angeles Convention Center.
The committee asked for more information on the proposed agreement with Wolff Urban Development that would give the firm all the bed taxes the hotel generated for 20 years, totaling about $114 million, as well as $36 million in loans, fee waivers and street improvements.
Leaders of the Los Angeles Chamber of Commerce, Central City Assn. and city convention bureau support the project. Leaders of unions representing city inspectors and engineers said the fee waivers for building permits and inspections could harm employees. Peter Zen, owner of the Bonaventure Hotel, said the subsidy would create an uneven playing field. A lawyer for downtown hotels said they might sue to block the subsidy unless all downtown hotels got to keep a share of their bed taxes.
Mayoral candidate Bob Hertzberg called for requiring require that the planned hotel’s profits be used to pay back the city for the tax breaks.
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