Event Center Convention Hotel Plan In Limbo

Stalled hotel lease and land purchase dominate meeting agenda

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The Payson Council on Thursday declined to officially give a hotel developer more time to develop a once-eagerly courted convention hotel next to the rodeo grounds.

Instead, the council simply refused to act on the developer's request for an extension of the previously approved lease of five acres of town-owned land next to the Event Center, on which the developer planned to build a 150-room convention hotel.

The council hoped that by neither giving the developer an extension or canceling the lease the town could leave its options open should it find another developer.

Moreover, several council members suggested that the town may get another resort hotel developer to build an even larger hotel on privately owned land, which would enable Payson to use the land for a proposed expansion of the Event Center.

"If we can get another hotel that will pay us bed tax and sales tax and we end up with a full 36 acres to develop for the Event Center, that's a win/win situation," said Councilor Ed Blair.

"I'm prone to do nothing," said Vice Mayor Su Connell. But she said perhaps the town could make sure to give the existing developer first right of refusal if someone else proposed a use for the property. "I know that this developer has worked very hard for the town and we dragged our feet for whatever reason."

The decision to do nothing about the event center hotel lease headlined a meeting that included several other key issues, including approval of the settlement of a $250,000 lawsuit and approval of a $540,000 down payment on buying 13.5 acres to expand hangars and other facilities at the airport.

The approval of the legal settlement with Charlie Hopkins involved a drunken driver in the parking lot of the Tonto Apache Tribe-owned casino. A man who had been in the casino bar, left the front entrance as a passenger in someone else's car. However, the other driver simply delivered the intoxicated man to his car. The drunken man then ran over a law enforcement officer, Hopkins, when trying to exit the parking lot.

The council held a 17-minute executive session, after which it unanimously approved a settlement, which included $10,000 in cash from the general fund and $250,000 from a statewide risk management policy the town carries.

The council also voted unanimously to approve a $540,000 payment for land needed to expand certain airport hangars and facilities. The town had already accepted and spent a $1.7 million federal grant, in anticipation of buying the land in question at the completing of a federal land swap involving the Forest Service.

Town Manager Debra Galbraith said the town would have to pay back the $1.7 million if it didn't go through with the purchase of the 13.5 acres for about $2.5 million. In addition, the landowners had offered to throw in another two acres for free. Galbraith said an additional $800,000 federal grant could offset the remaining costs, although the town wouldn't get the money until 2009.

The requested $540,000 comes at a bad time, with the town facing a 15 percent cut in next year over this year's spending levels.

Galbraith noted that the $540,000 was included in the budget projections presented to the council last week.

With that, the board unanimously approved the down payment.

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