Water park at Ford Park moving forward
Officials within Jefferson County and the city of Beaumont are moving quickly to approve a ground lease and begin construction of a water park and hotel at Ford Park.
But not everyone is on board with the possible deal.
Tuesday April 15, City Council members had a closed-door executive session about the proposed water park and hotel, and the week before that, county commissioners signed a letter of intent to bring the Ford Park addition to fruition.
It seems developers are still in talks with the city and county about what precisely will be given to the developer in the form of tax abatements and other incentives to ensure the project’s financial viability.
County Judge Jeff Branick emphasized there would be no county money used from the general fund on the proposed water park and hotel.
“It’s not going to involve any money being spent out of the general revenues of the county to fund the project. It’s their own financing for construction,” Branick said. “The county will enter into a ground lease for the water park and hotel. They will pay us $25,000 a year for the hotel ground lease and, if that revenue exceeds $500,000, they will pay us $50,000 a year for the ground lease. In addition, the hotel has agreed to build out at least 3,000 square feet of convention space within the hotel and refinish approximately 8,000 square feet of convention space within the existing Ford Park facility to make those finishes consistent with that of the hotel. The water park will pay us $15,000 a year for their ground lease and the county will grant ... I think we’re going to give them both a 10-year property tax abatement, both the hotel and the water park. And we’re going to give the hotel 15 years of rebate on their hotel/motel (HOT) taxes, the water park 10 years of rebates on the sales tax on the ticket sales.
“Basically what we’re giving up are the taxes we aren’t collecting because there’s no facility there,” Branick said.
Charlie Gibbs, a self-described businessman who has traveled across the U.S. promoting Beaumont on behalf of the Beaumont Convention and Visitors Bureau (CVB), said Beaumont should be jumping at the chance to have a water park attached to a Hotel at Ford Park, a nine-plus-acre plot that has mostly stood empty.
“We’re in the business to create people coming to town,” Gibbs said. “Competition escalates everything, and they did the same thing in San Marcos. They built a hotel right across from the Civic Center, and it increased everybody’s business. Nobody’s business went down. Everybody’s business increased. So it’s an opportunity. You don’t have an opportunity of someone coming in and spending $30 to $40 million in your city. We haven’t had that in I can’t remember when, and I’ve lived here for 50-some-odd years.”
But many in Jefferson County have decried Ford Park — originally marketed as a way to attract big names in the music industry and as being at least revenue neutral — as being a money hole. For the last 10 years the facility has been
subsidized heavily by Jefferson County taxpayers: some $1.7 million last year, according to Branick. Taxpayers are slated to subsidize Ford Park even more in 2014 due to the facility’s age and postponed maintenance, Branick said.
And though the county seems confident the proposal is solid, at least two Beaumont City Council members have signaled distaste with the deal.
Jamie Smith, whose Ward IV includes Ford Park, has already publicly expressed his distrust of the deal, saying he is on board with a water park, but not for granting hotel occupancy tax (HOT) abatements as it would unduly burden existing hotels who are currently paying the city and county HOT taxes. Currently, the city collects 7 percent, the state collects 6 percent and the county collects 2 percent in HOT taxes on Beaumont hotel occupancy.
And Smith already seems to have an ally on the council who agrees.
“The hotel portion of the hotel/water park project is so grossly unfair to the Beaumont hotels and does not give us a conference hotel as it has less rooms and conference space than the two largest hotels in Beaumont,” said At-large Councilman W.L Pate in an email. “The facts are our HOT tax receipts have declined in Beaumont between 2008-2013 from $15.9 million to $11.3 million. This decrease of over $4.6 million in HOT receipts is because the supply of rooms has increased and logically the rates have decreased to be competitive.”
Pate and Smith have agreed that the water park proposal would generate extra revenue to the county in other areas such as sales tax, but are standing by their dislike of abating a hotel.
Although the water park deal has the potential to make the county some extra money in sales tax, Branick confirmed the deal likely won’t bring Ford Park into the black.
“There’s some anger over that. But the county owns an asset that the taxpayers are paying for for the next several years through the bond that supported the construction,” Branick said. “We want to make that asset as valuable as we can. We want to make that asset as successful as we can, and this is the type of project that has the opportunity to make it a much more successful venue to decrease, actually bring in money in the form of grounds leases. Hopefully it will improve sales tax collection throughout the county and occupancy rates (in hotels) throughout the county. I think it’s an opportunity to lessen the subsidy and burden on the taxpayers.”
When taxpayers consider the other amenities at Ford Park including the arena and baseball/softball fields that are used throughout the year by traveling teams, and the fact that other water parks in the area aren’t as easily accessible, Branick said the pros outweigh the cons.
“There is one in Baytown that was actually built by the city of Baytown with public money and they are making a killing on it, and it’s not as big a water park as we’re introducing here,” Branick said. “The one there is three or four acres, and we’re looking at one that’s about nine acres here, so I think it’s going to be a much more eye-catching facility and of course it’s right on Interstate 10, which the one in Baytown is not. So the developers are pretty confident it’s going to be a great success, especially since it’s going to be aligned with the ball fields.”
Schlitterbahn in Galveston — the powerhouse of Texas water parks — is also too far away and not on as busy an interstate as I-10, Gibbs said.
Gibbs said the water park would add a few hundred jobs.
“They’ll probably hire 200 summer jobs for kids — college kids, high school kids,” Gibbs said.
The next move, Branick said, is for the county to embody their letter of intent in the next two weeks to allow for public money to be used for private purposes, a legal maneuver Branick said was added to the Texas Constitution to allow for economic development.
“Rebating sales taxes, or tax abatements, are considered the appropriation of public money for private purposes, so they allow that to be done statutorily,” he said. “That was basically done so that Texas could begin to compete with other states that were already doing it. We were losing out on some projects to other states.”
Once the city and county officially agree on the terms, construction on the water park and hotel could begin in the next few months with completion slated for spring or summer 2015.