Title
Incorporated County Of Los Alamos Ordinance No. 695; An Ordinance Adopting An Economic Development Project For Public Support Of TNJLA LLC., A New Mexico Corporation
Recommended Action
I move that Council adopt, as amended at the October 1, 2019 Council Meeting, Incorporated County of Los Alamos Ordinance No. 695 ; An Ordinance Adopting An Economic Development Project For Public Support Of TNJLA LLC., A New Mexico Corporation; I further move that, upon passage, the Ordinance be published in summary form.
County Manager's Recommendation
The County Manager recommends Council approval of this Ordinance
Body
After initially tabling the item on August 27, 2019, the continuation of the public hearing for this Ordinance was held on October 1, 2019. Several amendments to the Ordinance and Project Participation Agreement (PPA) were considered by Council and the following were accepted for incorporation into the final Ordinance and PPA:
-- TNJLA agrees to actively and continuously operate the hotel and conference center for the fifteen (15) year PPA term (extended from ten years)
--Remove “retail” from description of “food and beverage retail space”
--Addition of this requirement into the PPA: “In choosing an operator or owner of the stand-alone food and beverage space TNJLA shall solicit locally, regionally, and nationally”
Since amendments were made to the ordinance, including the Project Participation Agreement, the amended ordinance is now back tonight before Council for consideration.
Project Summary:
On June 9, 2009 the Council approved Incorporated County of Los Alamos Ordinance No. 543 which amended and restated the County's Economic Development Plan in compliance with the New Mexico Local Economic Development Act (LEDA). Based upon the guidelines within this program the applicant, TNJLA LLC., submitted the required materials for consideration of support.
TNJLA is a New Mexico corporation located in Albuquerque, NM. TNJLA is one of several LLC’s that are owned and operated by Tushar Patel and associates, a family run small business. TNJ Group has an average of 4.25 "stars" on Tripadvisor.com for their portfolio of properties. They have other hotel properties in New Mexico and this would be their first investment in Los Alamos County. TNJLA has made the request for the donation of the County land so that they can develop a new 86 room extended stay hotel with an event center that accommodates 250-300 people banquet style in Los Alamos.
The requested public support is a grant of County owned parcels of land: on 20th Street Extension; Lots 1C, 2C, 3C, 4C, 5C, and 6C which has the “Smart House” located on it. The total acreage is approximately 2.6 acres.
Los Alamos County has been seeking an "event" space for more than 20 years. The concept of “event” or “conference” space appears in many of the County’s strategic plans, including the Comprehensive Plan (2016); the Tourism Strategic Plan (2018); and the Economic Vitality Action Plan (in both plans 2010 and 2019). Approximately 8 years ago the County considered contributing as much as $6 million to a hotel and conference center concept that would have been a Hilton property, however, the market study at the time determined that adding hotel rooms would not be conducive to our existing hotel properties, although the study did extensive research on the event/conference center space and it was abundantly clear that there was necessity and demand for such a space even in the 2012 market. Since then our market has improved/changed and LAC has completed many of the milestones that were reasons why not to move forward with the project at that time.
The current project includes the following key terms:
1. County land will only be released to TNJLA upon entering into a Project Participation Agreement with the County;
2. TNJLA must submit and be issued a Building Permit for new construction for the new hotel within 12 months of the Effective Date of the PPA;
4. TNJLA will issue the County a Financial Guaranty in the form of a subordinated lien for the balance of the grant amount in decreasing value for the fifteen (15) year period of the PPA and a personal guaranty for the time period from the date of the County conveys the property to TNJLA until six (6) months after the Certificate of Occupancy is issued for the hotel/conference center;
5. TNJLA agrees to actively and continuously operate the hotel and conference center for the fifteen (15) year PPA term;
6. TNJLA will create and maintain a minimum of 17 full time jobs.
The ordinance and project participation agreement (with amendments from October 1, 2019 meeting) are included as Attachment A, and the developer has submitted photos/site plan/elevations to illustrate conceptual plans for the proposed facility. As will be discussed during the meeting, these conceptual presentations are subject to changes as the developer has not yet performed site specific due diligence.
Alternatives
Council could choose not to approve this Ordinance or Council could choose to make other amendments to this Ordinance or Project Participation Agreement.
Fiscal and Staff Impact/New Item
The fiscal impact is minimal to the County since the grant is in the form of a land contribution and the PPA provides for an economic return to the County. The staff impact will be minimal as the performance review metrics will be studied and reviewed on an annual basis for compliance.
Attachments
A - Incorporated County of Los Alamos Ordinance No. 695
B - Publication Notice
C - ROI for 20th Street LEDA
D - Pictures of other TNJLA hotel properties
E - Elevations
F - Proposed site map