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Delays on hotel cause city council to stall action on parking garage

Butler Mayor Tom Donaldson said a meeting next Tuesday could be the breaking point for the Centre City project.

City council had a special meeting this morning that was to award contracts for its proposed 239-space parking garage.

However, the city had to table any bid action because the developer of the proposed neighboring hotel has yet to finalize its agreements to buy land for the project from the city redevelopment authority.

“They’ve had some snags in their agreement,” Donaldson said.

Council said it cannot move forward with the garage until it knows for certain the Marriott Springhill Suites hotel will be built because the hotel will be the primary tenant of the garage — guaranteeing to pay for at least 50 spaces each night.

Donaldson said he had expected J.S. Capitol, the developer of the project, to buy the property at the corner of East Jefferson and South McKean streets this past Tuesday, but the deal wasn’t done.

Council went into recess from its meeting today. It will reconvene Tuesday night to make a decision on the garage.

While council hopes to award bids at that meeting, there could not be any left on the table.

Council said bidders can begin withdrawing their bids Monday, which marks the 60-day deadline from when the bids were collected in June.

City officials said the developer is using that deadline to get a larger percentage of the stake in ownership of the hotel.

The redevelopment authority is to own 36 percent of the property in a partnership with the developer.

“He’s treating this like he’s trying to buy a used car,” Donaldson said of Jeff Schmitz, owner of J.S. Capitol.

But Schmitz on Tuesday said that he was unaware he was supposed to have attended any meetings in Butler that day.

He said his firm is still working with the city redevelopment authority to finalize the deal, but did not comment further.

Council Solicitor Jim Coulter said the developer claims that it has invested a higher percentage of capital in the project than what the current joint venture agreement with the authority represents.

Council members expressed frustration with the status of the Centre City project.

“I’m appalled,” Councilwoman Kathy Kline said of the hotel’s delays. “Especially after the developer in his own words insinuated that the city didn’t have its stuff together (in the past). What’s the problem?”

Councilman Bill May compared the drawn-out process to other hotel developments in the county.

“The developers of the Holiday Inn Express and Hampton Inn in Butler Township got their projects done in no time,” May said.

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