Who Says Illinois is Broke? We’re Spending $200 Million on Hotel Expansion
In case you missed it, Medill Reports that the Metropolitan Pier and Exposition Authority(McPier) is taking taxpayer money to invest in enterprise which benefits McPier
The $1.1 billion bond offering will include $921 million to pay off existing debt as well as $200 million for hotel expansion plans. The new money will help build a new 450-room tower onto the 800-room Hyatt Regency McCormick Place hotel, which is owned by McCormick Place authority and run by Hyatt management.
Retiring old bonds sounds sensible enough, but what in the name of Hades is McPier, a State of Illinois sub-entity, doing spending $200 Million on hotel expansion? It’s insider trading, possibly legal insider trading, but nonetheless, trading with taxpayer money to make gains for a public entity which competes against taxpaying enterprise.
The bond issue is funded by a special set of taxes, and State guarantee. Per Crain’s
The debt will be paid back through tourism-related taxes, including a 6% tax on auto rentals in Cook County, a 2.5% tax on Chicago hotel rooms and a 1% tax on downtown restaurants. If McPier fails to collect enough from these avenues, state sales tax will cover the shortfall.
So existing Hotels are hit up for 2.5% of their revenue to fund speculation on building a hotel at an already underutilized convention facility. Just a thought, but if this was a good investment, wouldn’t private hotel developers be jumping at the chance to build a new hotel at 2300 Lake Shore? Or is McPier crowding out private industry to take the biggest cut from the top line of convention revenue? Take a look at the Google Map of restaurant locations near McCormick Place.
There’s a Burger King at 2328 South Michigan and a McDonalds at 2525 S King Dr, hmm..this looks good Shor, ah it is in the Hyatt, who could own that one…Mr. Leonard’s Soul Food Deli is not far away at 2005 S. Michigan, and looks interesting enough, but how do you get across Lake Shore and the Metra Tracks to get there? Oh, I see, you go up a mile, then back a mile to net 167 feet to Mr. Leonard’s. Triad Sushi Lounge 1933 S. Indiana might appeal on name recognition alone to overseas Triad members, but again, even the Triad has a hard time crossing 8 lanes of traffic.