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MailTribune.com
  • Deal should go forward

    Red Lion purchase should be judged by its benefits, not by comparative cost
  • Medford City Council members said unanimously Monday they are satisfied a pending purchase of part of the Red Lion Hotel is in the city's best interest. While we have qualms about the opaque process, we agree.
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  • Medford City Council members said unanimously Monday they are satisfied a pending purchase of part of the Red Lion Hotel is in the city's best interest. While we have qualms about the opaque process, we agree.
    The council held a closed-door session Monday with representatives of a company formed by Lithia Motors executives Sid and Mark DeBoer that is in the process of buying the hotel.
    The company, DHD, wants to sell 3.29 acres at the south end of the property to the Medford Urban Renewal Agency for $1.6 million. The entire 8-acre Red Lion property is for sale for $3.5 million, but DHD has not disclosed the actual purchase price to protect the seller's interest.
    MURA does not yet have the money to buy the property, so the City Council is prepared to front the purchase price from the city's contingency fund, which would be reimbursed by MURA.
    Some council members and city residents have questioned whether the city might end up paying more than half the total purchase price for less than half the land. Even if that turns out to be the case, it misses the point.
    Urban renewal dollars — which by law must be spent to further the goals of revitalizing a designated area of the city — are not intended to be invested in money-making deals.
    MURA's facade improvement program, for instance, essentially gave money to downtown business owners in the form of matching grants to spruce up building exteriors. The results are there for all to see, and the resulting increase in property value will generate higher tax revenue in the future when MURA has ceased to exist.
    The Red Lion purchase meets MURA's needs at a reasonable price, and appears to include a commitment from DHD that a substantial sum will be invested in improving the hotel, which is in need of an upgrade to compete with newer operations in the area.
    MURA will be able to build a parking lot to accommodate events at The Commons across the street, clean up the west bank of Bear Creek and add a walking trail, which has long been a MURA goal. Another goal is to build a pedestrian bridge across the creek, linking Hawthorne Park with The Commons and the downtown business district.
    Those are considerable benefits and a reasonable return for an investment of $1.6 million.
    If the overall deal results in an upgraded hotel and conference center in the heart of town, along with more parking and creekside improvements, that's a reasonable use of urban renewal dollars.
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