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Representing the Taxpayer (Editorial)

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The Jonesboro Advertising & Promotions Commission took a sensible step last week. It decided against committing $300,000 in taxpayer money to the Hyatt Place Hotel & Convention Center in Jonesboro, citing developer Chris Keller’s failure to provide requested information.

The $30 million Hyatt project, planned for the Centre Park Complex, would have 147 rooms and a 40,000-SF convention center. But it’s just one of two such projects in Jonesboro, a city of 70,000. The other is being built by Tim O’Reilly, CEO of O’Reilly Hospitality Management of Springfield, Missouri, who has an agreement with Hilton Worldwide Holdings Inc. to build a 202-room Embassy Suites Hotel and a 40,000-SF convention center on the Arkansas State University campus.

The Hyatt development had run into trouble, with contractors and subcontractors alleging they were owed $1.5 million, and the A&P Commission had demanded that Keller answer several questions about the project, noting “some serious red flags.”

We have consistently questioned the need for two convention center projects in Jonesboro, mindful of the disaster that ensued when the “twice-as-nice” city of Texarkana pushed ahead with dueling convention centers — one in Texarkana, Arkansas, one in Texarkana, Texas — in an ill-conceived effort to jumpstart economic development. The convention center on the Arkansas side also accumulated contractor liens, and last year the holding company for the project filed Chapter 11 bankruptcy.

Compounding the conflict in Jonesboro was that both convention center projects had received taxpayer money. However, the A&P Commission has recovered most of the $75,000 it had already given the Hyatt project. (And in the it’s-a-small-world department, we note that the commission’s new chairman is Jerry Morgan, a 40 Under 40 honoree in 2007 and our Executive Q&A this week.)

We appreciate the oversight the commission is exercising over the spending of tax revenue.

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