The City of Aiken is preparing to enter into a public-private partnership involving the redevelopment of the old Aiken County hospital property.
Aiken City Council will discuss investing roughly $12.5 million into the project during the special City Council work session at 4 p.m. Thursday, Aug. 29, at the Aiken Municipal Building.
The purpose of the work session is "discussion regarding potential public-private partnership with WTC LLC."
The city is looking to enter into a memorandum of understanding with WTC LLC of Graniteville – the company looking to purchase and redevelop the 828 Richland Ave. W. property into a hotel and conference center and apartments.
"The approximately 10.4 acres property would consist of a 100-room hotel, a 400-person conference center, surface parking lot and approximately 150 apartments," according to the work session agenda.
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The property, which was the Aiken County Hospital until the mid-1970s, then the administrative center for Aiken County government until 2014, is being reviewed for purchase by WTC, although no sale has been completed as of yet.
"The project would be an investment of approximately $45 million," according to city agenda documents. "As part of this investment, the developers are proposing a public-private partnership between WTC LLC and the City of Aiken.
"In order for this partnership to be considered, it is fundamental to this that a multi-county business park agreement be struck between Aiken County and WTC LLC. Under this agreement, the developer would pay a Fee In Lieu of Taxes at an agreed upon value over a defined period of time in this case, 20 years."
The portion of participation by the City of Aiken is $12.5 million, according to the agenda. Private sector dollars would total $32.5 million.
City officials claim a 20-year projected economic impact of the project would be a projected market value of $240 million, according to the agenda.
The city proposes to accomplish the $12.5-million investment for the project through the following funding sources:
• $10 million from a 20-year Fee in Lieu of Taxes agreement accomplished through the multicounty business park agreement.
• $1.175 million from borrowing against expected collection of the property’s hotel accommodation taxes over 20 years. This is based on an average daily occupancy of 50% for 100 rooms with an average daily rate of $140.
• $1 million from storm water infrastructure work. Money from CPST IV for downtown stormwater infrastructure improvements.
• $325,000 from hospitality tax funding for public surface parking at the property.
The city would pay out funding in allocations of 20% as five benchmarks are achieved during the project, according to the agenda.
"To protect the city’s interest, we have several conditions and clawbacks in the proposed agreement," City Manager Stuart Bedenbaugh stated in the agenda document.
These conditions include that "WTC LLC must deliver the agreed upon scope of the hotel, parking and apartments," and that "WTC LLC must substantially complete the project within 36 months or the available funds will be reduced by $100,000 per month."
The memorandum of understanding, or MOU for short, could appear on City Council's agenda for a vote at the Sept. 9 regular meeting.