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Wednesday, October 22, 2014 |  Madison, WI: 36.0° F  Fog/Mist
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Madison committees to grapple with Edgewater Hotel project again Monday night
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This week, Madison will be again consumed by the Edgewater Hotel redevelopment project, with two key committees deliberating on different aspects of it.

Both meetings are on Monday night at roughly the same time: Board of Estimates (PDF) meets at 4:30 p.m., the Landmarks Commission (PDF) at 4:45 p.m.

The city's various governing bodies and committees have been wrangling over the controversial $100-million project by Hammes Sports and Entertainment for months. Here is a rundown of several key issues facing policy makers.

Two for the price of one.

The Common Council decided to go ahead and hold both meetings at the same time on the same night, in an effort to move the project ahead for a Common Council vote at its May 18 meeting.

Some have criticized the move. With all the scrutiny the project has gotten, how will people decide which meeting to go to? How will the developer be able to ask questions from both bodies?

"I can't see why this can't wait until the next regularly scheduled [Board of Estimates] meeting, since several of the delays have been because of Hammes," says Ald. Mike Verveer. "I don't see what the rush is. It does a tremendous disservice to my constituents."

Ald. Marsha Rummel is also critical, saying, "It does a disservice to the public and it's a mistake. It sends the message that we don't care. It's just bad process."

But Council President Mark Clear says an attempt to reschedule the Board of Estimates meeting proved unsuccessful because "other nights didn't work for one reason or another."

Instead, Board of Estimates will adjourn for a couple of hours to hear testimony at Landmarks, and then go back into session. Clear says, "The idea is to try to wait until the public testimony is over." But he adds, they won't wait forever, since the last time Landmarks considered an Edgewater proposal, it took seven hours.

TIF application

Hammes is asking for $16 million in tax incremental financing for the project. Some say winning approval for the TIF application will be the toughest vote for Common Council.

"Is this a good deal for the city? is the basic question," says Verveer, who is on the board. "Beyond that, how does this fit into our adopted financial policy?"

"For a lot of alders -- and lucky for Hammes they only need 11 votes -- the $16 million is going to be a tougher vote," he adds.

In its application, Hammes is asking for some big exceptions to the city's TIF policy. Exceptions are regularly granted for TIF applications, says Joe Gromacki, the city's TIF coordinator.

The first is the "50% rule," which states: "No more than 50% of the net present value of the tax increment generated by a private development project shall be made available to that project as gap financing."

In a memo (PDF) to the council, Gromacki wrote, "The incremental value of the Project, as estimated by the City Assessor's Office, would generate sufficient tax increment to support a TIF Loan of approximately $3,300,000 if the 50% Rule was applied. The proposed loan amount significantly exceeds the limit of this policy. Approval of an exception to policy that allows 100% of the tax increment generated by the Project would support approximately $6,600,000 of the $16,000,000 TIF Loan."

Hammes is also asking for an exception to the self-supporting rule, which "prohibits using tax increment from other property within a TID to supplement a particular project." Meaning, increased property tax gain from other properties in the district would be required to pay down the $16 million. In his memo, Gromacki writes the district "is currently generating sufficient tax increment, estimated at $1,500,000 per year. Combined with an estimated $900,000 of increment generated by the Project, staff forecasts that tax increments will be sufficient to repay the entire $16,000,000 TIF Loan by approximately 2019."

Gromacki says that Hammes wanted as much as $20 million in TIF money, but adds, "city staff dug their heels in to say it's not feasible for us to go to $20 million."

Landmarks Redux

The Landmarks Commission, which voted last November to deny Hammes' application for a certificate of appropriateness, will take a second look at the project, which has been modified.

Clear says the big difference now is that the neighboring National Guardian Life building is now included in the standards to be considered for the project. Still, he says, "The overall issue is really one of subjectivity. When landmarks made the decision last time, some people thought it was not visually compatible and some people did.

There's really no way to describe in law what that means."

But, Verveer says the project is no more appropriate for the neighborhood than it was before. "I would argue that the Mansion Hill historic district is not only the city's most important historic district, but the state's most important historic district," he says.

He adds that proposed hotel tower breaks the district's height limit "in spades." "It's really hard for me to reconcile why I've said no to every other developer over the years and then say yes to the Edgewater."

There's a train a'comin'

With the announcement last week that Wisconsin would locate the Madison's high-speed rail station at the Monona Terrace, suddenly the Edgewater project lost a lot of its marquee value.

"The Edgewater is simply too far for conventions, believe it or not," Verveer says. "We need more beds within a stones throw of Monona Terrace. I think the governor's announcement will accelerate development near the Terrace."

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