Miramar Hotel Timeline Gets Pushed Back
Updated On: Feb 05 2014 11:17:09 AM CST
Millionaire developer Rick Caruso is no longer asking for big tax breaks from Santa Barbara County to help rebuild the landmark Miramar Hotel.
It's been more than a year since Caruso told the public his timeline was to have the hotel open in 2016, but that most likely will be pushed back.
The Miramar property in Montecito has sat vacant for years. In January 2013, Caruso told a crowd of journalist of his plans.
"My goal is we open up this property in 2016," he said.
However at the time, a stalemate between the developer and the county prevented any movement. It's now been more than a year since the two parties talked.
The big issue is the Hotel Incentive Program. The program would give Caruso a 70 percent rebate on the 10 percent transient occupancy tax guests pay when they stay in a hotel room in the unincorporated areas of Santa Barbara County.
"We recognize the important economic contribution tourism plays for Santa Barbara County. So this was really designed to get a kickstart at a time when banks weren't loaning a lot of money," said Dennis Bozanich, the assistant to the county chief executive officer.
At the time, Caruso said he would only be able to get the money for the project if he got a 15-year guarantee for the rebate.
"We get our TOT issue resolved quickly, and we get out on the market this year for our financing and we break ground next year," Caruso said in 2013.
Since the Board of Supervisors would need to approve the Hotel Incentive Program every year during budget hearings, the guarantee was not possible.
"We tried to provide an incentive, the terms were not satisfactory and Mr. Caruso was unable to take us up on our offer," said Salud Carbajal, First District supervisor.
Matt Middlebrook, Caruso's executive vice president of development, told NewsChannel 3 that Caruso Affiliated "threw in the towel on the transient occupancy tax" -- meaning, they will no longer pursue talks with the county regarding the Hotel Incentive Program.
But even if they wanted to, Carbajal doesn't think the offer would still be available since both the developer and Board of Supervisors would have to sign an agreement.
"(The Hotel Incentive Program) was established for a time when we had a really bad economy, to provide an incentive for Mr. Caruso to move forward. The economy has gotten a lot better, and despite Mr. Caruso not accepting the county's terms, I'm not sure that that incentive would still be on the table today because the economy has improved dramatically," he said.
Middlebrook said the program is not in the equation and in the past six months the economy has moved in their favor and they are "still actively looking at ways to identify financing."
However, he doubts construction will start this year as planned.
"We need to get into substantive design, engineering and landscaping," said Middlebrook.
"I think it's hard to know what the timeline would be. Generally on projects of this scale and scope, we're probably still talking anywhere from six to 12 months of additional work," said Bozanich.
Middlebrook said an announcement from Caruso Affiliated is expected in two to three months. He didn't say what that announcement will be.
"I'm hopeful that in 60 to 90 days, we hear that he's going to build this project, which I think the community and the county would really appreciate and look forward to," said Carbajal.
Last month, Caruso Affiliated updated the Montecito Association on the progress of the project, but gave no solid update.
Ted Urschel, the president of the association said he is hoping to get together with the developer in a few weeks, but would not comment further.
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