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Dear Editor:
Carmel’s Redevelopment Commission executive director recently informed the City Council the $40 million Hotel Carmichael under construction would cost $58.5 million due to rising material and labor costs. To cover the shortfall, he said, the Commission unilaterally is dipping into pots of money it has collected.
One of those pots holds the proceeds of a mortgage the Commission has taken out on a building it built and actually paid off.
He neglected to tell the Council how the material and labor cost escalation was affecting all the other projects in which the Commission is investing borrowed money, what the balances are in the pots of cash stashed here and there, what other buildings the Commission owns and can mortgage in the future at what price.
He did point to money-saving steps taken in what was to have been a luxury hotel including but not limited to substituting brick for the stone exterior, replacing the marble lobby floor with a synthetic material and using common shingles instead of slate roofing. So much for luxury.
The city’s hired hotel management firm is now taking reservations beginning in September (the hotel might open in May) and a king-sized bedroom goes for $119, or just about what other hotels in the area charge.
Recalling the Center for the Performing Arts was to have cost $17 million but ran $262 million (and counting), Carmel taxpayers need to fasten their seat belts. Turbulence ahead.
Bill Shaffer
Carmel