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RDC approves $300,000 for preliminary host-hotel design as talks continue over TIF incentives
Summary
The Bloomington Redevelopment Commission authorized preliminary design funding to advance negotiations for a proposed host hotel near the convention center, while commissioners pressed staff for more details about incentives, ownership and partnership options before committing larger sums.
The Bloomington Redevelopment Commission on June 2 approved a staff request to fund preliminary architectural design work—$300,000 was cited in staff discussion—to refine size, layout and early cost estimates for a proposed host hotel near the convention center on city-owned College Square property.
The approved design work is limited to preliminary drawings and cost estimating; it does not commit the commission to particular incentives or to disposing of city land. Staff and outside counsel said the design deliverables will help the city and any partner estimate total development costs and negotiate a letter of intent.
Why it matters: The convention center expansion under construction increases demand for a nearby host hotel. Commissioners and staff discussed multiple possible incentive structures — tax abatements, TIF support, direct cash, bonding arrangements or an RDC partnership model — and emphasized that the city needs a reliable project budget before structuring incentives.
What was approved: Staff asked the RDC to pay for preliminary design work so the city would “own the work product” and be positioned to negotiate. Staff explained that about $100,000 has already gone to environmental and preliminary due diligence work and that soil borings and other site assessments are underway.
Debate over structure and risk: Commissioners split on how much forward funding the RDC should provide before a written commitment from a developer. Some members said the RDC should own the drawings and consider a partnership model (citing Carmel’s approach) to capture future revenue streams and to preserve control over long-term capital upkeep. Others asked for a clearer “menu” of possible incentive structures before authorizing additional spending. The commission agreed to invite outside counsel Scott Chen to a future meeting to explain typical incentive arrangements and to brief the RDC on options.
Developer selection and next steps: The county’s capital review board (CIB) had identified a preferred hotel developer (the transcript references the developer chosen by the CIB). Staff said a letter of intent with the hotel developer would be negotiated after the design work provides a project budget. Staff also suggested that an RDC representative could sit in on negotiations and that the RDC could discuss disposition or partnership terms in executive session.
Outcome: Motion to approve the preliminary-design funding passed (four ayes, one nay). Staff will return with further due diligence results, soil-boring reports, and a proposed engagement plan that may include outside counsel and an RDC designee participating in negotiations.
