AUBURN — Despite 11th-hour talks between all involved parties, a local development board rejected two separate requests by a Syracuse developer looking to build a hotel in downtown Auburn.
The Auburn Industrial Development Authority board voted 9-0 against a proposal that would have allowed AIDA to use eminent domain to move the hotel project along.
The board also voted 5-4 against developer Pioneer Companies’ requests for various financial incentives that included a 25-year agreement to fix the hotel’s assessment.
The votes came after two years of talks between AIDA, Pioneer and Auburn city officials over an 88-room Hilton Garden Inn at the corner of Water and State streets.
The discussion intensified almost two months ago after it became public that the developer was asking AIDA to use eminent domain to acquire properties if they can’t negotiate deals themselves.
At the time, those properties included the site of the Wag’In Tail dog-grooming business, the New Shanghai Chinese food restaurant and an adjacent open lot.
After the meeting, David Murphy and David Norcross of Pioneer did not comment when asked if the project is dead.
However, AIDA board Chairman Jim Dacey said the decision doesn’t necessarily mean the project can’t still happen. In fact, the owners of Wag’In Tail and New Shanghai had very recently signed contracts with Pioneer to sell.
“It would depend on the developers coming back and talking about the PILOT,” Dacey said while talking to multiple reporters.
That PILOT, a term which stands for payment in lieu of taxes, would have allowed the developer to pay property taxes based on today’s assessment of the properties at the site. That assessment would stay the same for 25 years, according to the proposal.
The terms of that agreement were likely the topic of the discussion among the board during a two-hour closed session. During the closed session, AIDA officials occasionally came out to talk with representatives from Pioneer before returning to the meeting room.
According to state open meetings laws, a public board can only talk behind closed doors about a land acquisition if public discussion would significantly affect the land’s value, which state open government experts say is not the case with eminent domain. However, the law does allow boards to discuss some terms of a contract with a corporation, an exception that can include PILOT agreements.
While eminent domain was the most controversial issue in the eyes of the public, AIDA board member Matthew Smith said after the meeting that the PILOT was a major sticking point for the majority of the board.
Smith said a 25-year agreement, which is longer than standard PILOTs, would set a “horrible precedent” for future development projects in the city.
“I think the board realized that this was one of the most lucrative projects in AIDA history,” said Smith, who has also been a vocal opponent of eminent domain.
“It was not worthy of a 25-year PILOT and ridiculous conditions that really are not going to benefit the city taxpayers,” he said.
The crowd of 30 to 40 people who waited through the closed talks cheered loudly after the board voted down the proposals. The eminent domain issue sparked public debate for weeks leading up to the meeting. Local residents marched downtown during a rally last month and packed a public hearing at city hall.
The issue also gained national attention, with a major cable news network reporting on the eminent domain proposal.
But eminent domain would ultimately not have been in play for Doug Ward, who owns the Wag’In Tail property with his wife, Renee. Just hours before the meeting, they signed a deal with Pioneer that would have allowed them to stay at their State Street location if the hotel was approved.
Doug Ward said they did what they had to do to protect themselves through the process. But he also said he was “absolutely impressed” that the AIDA board members voted together against eminent domain.
“We have a real sense of relief that this is over for us,” he said. “But this is far better to see them defeat it, especially in the fashion that they did.”
Mike Kazanivsky, who owns the vacant parcel on the site, expressed his relief with tears after the meeting. Kazanivsky has owned the land for more than 10 years with plans to build a mini-golf course and ice cream stand.
“I’ll be able to sleep tonight. The first time in three months,” Kazanivsky said.
Staff writer Christopher Caskey can be reached at 253-5311 ext. 282 or email@example.com.