- $525 Million Plutonium Settlement provides once in a lifetime opportunity to invest in concrete project that creates generational prosperity for the City of Aiken.
- City borrowed $9.6 million to purchase the property at ultra-low interest rate and anticipates repaying that within two years from anticipated Plutonium Settlement funding.
- City has requested $20 million in Plutonium funds to directly support Pascalis. That request is being considered by the General Assembly and passage could come as early as June of 2022.
- To lure the $60-$70 million private dollars estimated to build the hotel and apartments/retail space, the City will borrow against future hospitality and accommodations revenue an estimated $15-20 million to complete the garage/conference center/street and infrastructure improvements. (IPRB similar to financing of public safety and new municipal building)
- Developers will receive no tax abatements, no TIF, and no ongoing subsidy. Their incentives will be to adjacent location of parking and the event center to draw hotel guests. The sole, one-time, financial incentive will be a discounted price for the property upon which they will build the hotel and apartments.
HOW WILL THAT BE PAID BACK?
- Aiken’s 1 percent hospitality tax on restaurant meals, beverages and prepared convenience foodstuffs provides more than $1.5 million per year in revenues that are limited by state law to expenditures that promote tourism and growth in the hospitality sector. These funds will be available to defray the debt service related to the public financing of the garage and event center.
- Local accommodations tax revenues paid on overnight stays at area hotel and motel properties must also be used by law to promote tourism and provide tourism infrastructure, such as parking facilities and event centers.
- City taxpayers will see NO PROPERTY TAX impact related to the financing of the project
- In fact, the private sector investment in the project will increase the property tax revenues received on these downtown parcels by at least 875% FROM DAY ONE! Increased value of the property itself brings more revenue to the City, County and School District with NO CHANGE to existing millage rate.
- Pascalis will create a stimulus that encourages the private improvement of surrounding properties and will bring new commercial and retail businesses to the area, thus creating more prosperity, jobs and revenues for local government to improve services.
Supporting Data:
- Hotel: AECOM Study
- Aiken has about 600 fewer hotel rooms than comparable cities
- Aiken lacks hotels with modern facilities within a 2-mile radius of downtown. Of the 10 hotels within a 2-mile range of downtown, only 1 has been built since the year 2000
- Bandwagon, a destination marketing firm, states that Aiken has a need for upper-tier hotels explaining that Aiken’s 5 most common subgroups of visitors seek upper-tier hotels.
- Conference Center:
- AECOM Study: An initial study showed Aiken could support a conference center with a ballroom between 5,000-10,000 sq ft
- A Conference center demand study done by HVS revealed that a conference center ballroom of around 6,000 sq ft. adjacent to upscale lodging was a need and could be supported in downtown Aiken
- HVS conference center demand study reveals that most of the events will be meetings, social events and civic group gatherings. Though much of the events will stem from local people and businesses, they project and additional 6,000 hotel nights will be generated from activity at the conference center.
- It is expected that this project will bring to downtown:
- 150 new jobs
- 150 residents
- An additional 3.3 million dollars in local government tax revenues annually
- An additional $50-70 million in private sector investment to build hotel and apartments
- Housing Study Aiken’s latest study on rental housing revealed that Aiken’s most significant need in rental housing is 1- and 2-bedroom units in the downtown area. Almost 3,000 people work in downtown Aiken, yet less than 1 percent of those people live in downtown primarily due to a lack of available housing.