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2015-11-12

Could this be a 'sign o' the times?'

By Judith Pannebaker BCC Editor

The last time a hotel came a calling in Bandera, developers requested an off-premises sign to generate money for both them and the city. This time, if the developers' terms are agreed upon, it will require the municipality to shell out much more moola.
In this background article, "Assistance and incentives for business development in Bandera" served as the topic du jour at a July 2 workshop of Bandera City Council. Discussions during a Tuesday, Nov. 10, workshop on the same topic will be published in the Nov. 19 edition of the Courier.
Incentive requests
In April, Gene Hartman, facilitator for proposed mixed-use project on Main Street that would include a hotel, had provided Mayor John Hegemier with documents outlining incentives requested by the developers. In turn, Hegemier asked council for guidance about what council was willing to offer. Project owner-developer is Gene Longoria.
Hegemier told council the developer originally requested an increase in the Hotel Occupancy Tax (HOT funds) to the maximum amount of 16 percent. "Currently we are at 13 percent," Hegemire said.
Correcting him, Bandera County Convention and Visitors Bureau Executive Director Patricia Moore said, "The maximum is currently 18 percent and Bandera is currently at 15 percent." Hotel Occupancy Taxes are levied on out-of-county visitors who stay overnight in the city's hotels, motels, guest houses and beds and breakfasts.
According to Hegemier, complex developers also requested funding for all required off-site development improvements, including new offsite parking along a to-be-instituted one-way Oak Street; providing a tax abatement for all personal and real property taxes for the first 10 years of operation; waiving all fees for permits, utility connection fees, impact fees, tap fees and offsite utility extensions, if needed; providing $100,000 of onsite improvements to grade and build pad sites for the building foundation and parking lot; and providing additional offsite parking along Oak Street if needed to meet city parking space requirements.
Hartman also asked that the CVB execute a three-year contract with Longoria to lease the conference center for $36,000 per year to be paid from the HOT funds.
We'll give you ...
In turn, according to Hegemier, Longoria would contribute land for the project; apply for a conventional loan from a local lender; develop 12,000 square feet of retail spaces and restaurant with drive thru; develop 32 furnished loft rentals with full kitchenettes, as well as 21,006 square feet of conference space with warming kitchen, serving bar and two water fountains.
The complex would also include six retail spaces. "We have one lady who wants 5,000 square feet and we're trying to work it in," Hartman said. Additionally, Longoria, he said, would manage day-to-day operations of the so-named Bandera Main Street Shops and Lofts.
When asked about employment possibilities, Hartman said there would be about 15 part-time employees in the restaurant and 60 in the retail spaces. Hotel housekeeping staff would be a mix of both full-time and part-time positions.
Hartman noted the project would cost $5.6 million at $150 per square foot. The pro forma for marketing the first year would be $100,000 - with $36,000 budgeted for a salaried marketer and an additional $5,000 per month for marketing itself. "This is a public-private venture and we would work with CVB and the city to accomplish the goals," Hartman said.
Conference
center kibosh
However, in a later workshop in July, presiding officer Mayor Pro Tem Suzanne Schauman put the kibosh on the conference center, saying, "(The developers) wanted the CVB to rent out the conference center for $36,000 (per year) and that is not going to happen." This revelation seemed to signal the beginning of the end for the conference center.
As Councilman Glenn Clark noted, "We want more rooms and can do away with the conference center." All concurred, "The more rooms we can get in Bandera the better."
Additionally, the "furnished loft rentals with full kitchenettes" didn't sit well with most councilmen, who felt the kitchenettes would create a conflict for businesses in town. Longoria described the kitchenette as having a short counter with a sink, small dishwasher and two stove burners with a microwave above it.
"This will not cut into the restaurant business but is more of a convenience for people," he said.
Noting that "Bandera only has a volunteer fire department," Mike Armstrong, city code inspector, asked Hartman and Longoria to "get rid" of the stove or burners.
Acquiescing, Hartman said, "We're sensitive to that issue and the item will be removed from the plans."
Regarding the management of daily operations, Longoria said the hotel would not have a 24-hour desk staff, but would, instead, be monitored by a private company.
Additionally, although Bandera County Commissioners recently approved rudimentary steps to possible tax abatement incentives for new businesses in the county, the abatements would not carry over to new development within the city limits.
Texas Capital Fund
Hartman noted that he had been contacted by the Texas Capital Fund because "they have money to spend and thought this might be a good opportunity to assist the City of Bandera with funding." In turn, City Administrator Lamar Schulz said that the Texas Capital Fund would have to be researched to determine if the loans would be feasible for Bandera.
A program under the umbrella of the Texas Department of Agriculture, the Texas Capital Fund provides zero-interest loans to fund real estate acquisition or improvements, which create or retain permanent jobs in primarily rural communities and counties.
A cursory examination of the website, texasagriculture.gov/GrantsServices/RuralEconomicDevelo-pment/TexasCapitalFund.aspx, revealed that the grant applicable to hotel and retail space development would probably come under the Texas Capital Fund Infrastructure-Real Estate Programs, which encourage new business development and expansions.
Funds from the real estate program must be used for real estate development to assist a business that commits to create and-or retain permanent jobs, primarily for low and moderate-income persons - which might describe most working people in Bandera. However, the real estate and-or improvements must be owned by the community and leased to the business.
Application minimum and maximum awards are $100,000 to $1,500,000.