Oct. 03–PATERSON ? A city-based charity is seeking more than $100 million in state tax credits to help fund a 17-story hotel and convention center next to St. Joseph’s Regional Medical Center, part of a project that also would include a seven-story office building.
But the request could hit a wall if the mayor withholds support, and he was noncommittal about the project this week.
Frank Brady, the chief executive officer for Medical Missions for Children, is asking the City Council and Mayor Jeffery Jones to endorse the project in an effort to gain the tax credits through the New Jersey Economic Development Authority.
Three years ago, Paterson rejected Brady’s request for the city’s guarantee of more than $50 million in bonds for the hotel. He is asking for a different type of backing now.
“We’re going to do a top-shelf job and it’s something we’re all going to be proud of,” Brady told the council Tuesday night.
The council next week is scheduled to vote on a resolution in support of the project, and all signs are that it will gain approval. “I fully support this,” said Councilman Rigo Rodriguez. “I believe it’s our job to protect your investment.”
But Brady faces a tougher challenge in getting Jones to send the state a letter endorsing the project. “The council can do anything it wants, but the administration has a different standard of review and everything has to make sense,” Jones said. “As to which way I’m leaning, I’m not going to say yet.”
Brady said on Tuesday night that the mayor’s backing was one of the things needed to gain the state tax credits.
For more than two years, Jones has been pushing for the construction of a hotel near the Great Falls. Over the summer, he met with investors from India to discuss that idea and other economic development possibilities. Jones also has questioned St. Joseph’s involvement in the project as well as the role played by Councilman Kenneth Morris, who is the medical center’s director of government affairs.
In 2010, St. Joseph’s issued a press release proclaiming that the hotel project stemmed from a partnership between the hospital and Medical Missions for Children. That press release included a photo of Brady, then-mayor Joey Torres, St. Joseph’s president William McDonald and Morris standing in front of an artist’s rendering of the proposed building.
On Tuesday night, Brady told the City Council that St. Joseph’s only role would be providing the land for the project under a lease agreement. Morris left the council chambers to remove himself from discussion of the project.
Brady said the project would be funded with a loan from Commerce Bank, support from Morristown-based Hampshire Real Estate Cos., and other investors through EB-5, a federal program that provides visas to immigrants who invest at least $1 million in projects in areas with high unemployment.
Medical Missions is seeking assistance through the Urban Transit Hub Tax Credit program, which expires at the end of the year. The proposed council resolution, sponsored by Councilman William McKoy, says there are about $200 million in tax credits still available under the program and that Paterson is the only one of eight cities eligible not to get an award.
Officials said the proposed resolution requires no commitment or risk by the city, though it does say the council eventually would consider a payment-in-lieu-of-taxes agreement.
The two towers would be built on Main Street on the land between the hospital’s new parking garage and its main entrance, Brady said.
Medical Missions has an ongoing agreement with Hilton Hotels & Resorts to operate the hotel and convention center, Brady said. He told the council he expected between 40 and 60 percent of the rooms to be filled by people using the medical center and 22 percent to come from Hilton’s international reservation system.
Brady also said the project would allow his organization to create an internship program with local high schools for students studying hotel or event management.
If all goes well, construction could start in the spring and the towers would be completed within 18 months, he told the council.
“The sooner we get it open, the sooner the cash flow starts,” he said.
