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Decision delayed

Decision delayed

Council moves both conference center proposals forward

November 19th, 2013 in News

Trey Propes, left, and Scott Ehrhardt, right, address members of the City Council while speaking on behalf of Ehrhardt Hospitality Group's conference center proposal during Monday night's meeting and vote at City Hall. Seated at front right is Kirk Farmer of the other developer, Farmer Holding Company.

Photo by Kris Wilson

After more than two hours of debate, the Jefferson City Council voted to move both conference center proposals forward to the development stage, effectively holding off on any decision between the two.

At the City Council meeting Monday, members voted 6-4 to move conference center proposals from Jefferson City-based Farmer Holding Co. and Hannibal-based Ehrhardt Hospitality group forward to the development stage, where contract negotiations will begin.

Third Ward Councilman Ken Hussey, 4th Ward Councilwoman Carrie Carroll, 5th Ward Councilman Larry Henry and 5th Ward Councilman Ralph Bray voted against the motion.

Interim City Administrator Drew Hilpert said the next step would be to discuss whether the council once again would like to hire a consultant for the next step. The council had hired Charles Johnson, of Johnson Consulting, to be the facilitator of the last phase at a cost of $17,000, but that contract has ended. Hilpert said the council also needs to discuss what developer costs would be reimbursable in the next phase and he expected to have those discussions within the next few weeks.

Hilpert declined to give any type of timeline for the next stage of contract negotiations, at one point stating it could take anywhere from two months to two years. Once negotiations are finished, Hilpert said he would bring the council contracts with each developer to vote on.

"We've got the bare bones of an idea," Hilpert said. "All the guts are coming later."

Second Ward Councilman Rick Mihalevich, who made the motion to advance both proposals, said he wanted to get more details and answers on both proposals before making the final decision on choosing one or neither.

"I don't think we have the answers that we need to move forward," Mihalevich said. "I'm willing to go forward to try to get some of these questions answered."

Both developers were pleased with Monday's outcome and hoped it would lead to more information and answers on both.

Farmer Holding Co. has proposed a $36 million hotel and conference

center at the Capital Mall, while Ehrhardt Hospitality has proposed a $24.6 million hotel and conference center at the West McCarty Street site, which is owned by the state.

Scott Ehrhardt, with Ehrhardt Hospitality Group, said being moved to the next phase will allow the city and developer to meet with the state and see what state officials would be willing to contribute to the project, as well as what is needed to acquire the land.

"I think it's a great decision," Ehrhardt said.

Kirk Farmer, with Farmer Holding Co., said by moving both proposals forward, the council and the public will be able to find out which proposal truly is feasible and the best for the city.

"It allows the public the greatest flexibility," Farmer said. "This allows the public to move forward."

Though earlier in the meeting, Farmer called the Ehrhardt proposal at the West McCarty Street site a "Hail Mary," he said moving to the next phase will allow everyone to find out if the downtown location can work or not.

Both Farmer and Ehrhardt expressed a willingness to work with the other should their proposal be selected.

The motion to move both proposals forward surprisingly originated from a motion to reject both proposals by Hussey, who said the original goal of the council request for proposals was to see what the $9 million of lodging tax funds would get the city. Now that they know the answer to that, he said it may be time to rethink whether a conference center is feasible at all.

"Maybe we're after something that we just simply can not truly afford," Hussey said.

Hussey said it may be time to "get creative" and think of alternate ways to use the $9 million to promote tourism in a way that will provide the community the best return on its investment.

Mayor Eric Struemph said if the council had voted to reject both proposals, it would have been the "worst case scenario."

"A no-no (vote) right now is a horrible use of our tax dollars," Struemph said.