ICONA CEO Eustace Mita recently presented an elaborate plan for a resort hotel complex in Cape May City. The seven-story structure designed in the style of a turn-of-the-20th-century grand hotel is estimated to require a $150 million investment that may take up to a decade to begin paying for itself.
Earlier in the year, Mita’s attorney asked the city to explore a possible redevelopment zone designation for the area of the old Beach Theater which would serve as a site for the project. As reported in the Herald, the city’s solicitor responded with a letter that rebuffed Mita’s request, reporting that there was no support on the governing body for a redevelopment zone designation.
It’s an equity concern. Why should Mita get advantages not available to every property owner in Cape May? The answer is $150 million dollars. No, mere money does not make special considerations a given. Yet an investment proposition that would make a city project one of the largest such investments in the county’s history does warrant more than a knee-jerk reaction based on some mythical equivalence between a property owner adding a sunroom and a developer seeking to invest significant amounts in a city project.
When a successful entrepreneur–and Mita meets that definition without argument–is proposing an investment of this size and magnitude, it deserves more than a general test of “fairness.” What are the advantages of a redevelopment zone for a project of this scope? How does the city potentially benefit? Is it really the case that this level of investment in the city’s main business, tourism, should be automatically opposed because some feel it would add to a parking problem? Isn’t parking a problem the city must find a solution for regardless of what happens on the old Beach Theater site?
More sophisticated arguments against the redevelopment designation involve fears that the project could by-pass the planning and zoning boards and that it would not be as accountable to the Historic Preservation Commission (HPC). Not so in all cases. Site plan reviews, variance justifications and presentations to the HPC would all have to happen. There is a difference with a redevelopment zone designation, but it is not because the project gets a free pass.
The difference is that the responsible boards would get to establish a set of exceptions that would not have the weight of setting precedent elsewhere in the city. The “normal process” which so many argue should be followed actually exposes the city to legal precedents if variances and exceptions are approved for the project. Nothing in the redevelopment designation requires the city and its boards to grant exceptions. It offers an opportunity to do so with greater flexibility.
There is another difference as well. The redevelopment zone designation would likely mean the governing body could be involved more in the process than it would normally be. Mullock says he does not want the governing body involved. Why? They could get involved even without the redevelopment designation if they choose to do so. That is the meaning of “governing body.”
The Taxpayer’s Association has come out against the project, calling it a “troublesome proposal.” The organization has published a newsletter examining the ICONA proposal and making a response to its various elements. Thoughtful as it is, there is no evidence that this rejection is based on anything more than what the public in general saw at the ICONA presentation.
When the Taxpayer’s Association urges the city “to terminate any further consideration of the use of the Redevelopment Zone for the Beach Theater property,” the request is to terminate what has never started. There is no evidence that the council’s flat rejection of the redevelopment zone designation is based on any negotiation or in-depth discussions with Mita.
We ask if this is the best way for the city to respond to an entrepreneur proposing a massive investment in the municipality’s future? Giving this proposal careful consideration, seeing if adjustments to the plan would alter opposition, looking carefully at the potential financial impact on the city’s main business line: all these steps seem to have been skipped. For what reason?
Is Cape May’s future so assured and its direction so clearly marked that quick dismissal of a proposed investment of this magnitude is warranted? It is comforting to think so, but the reality may be different.
In the last census, Cape May lost more permanent population than any city of its size in the state. More and more hotel space has disappeared as condo-hotels have been the darlings of investors. Has Cape May really looked at the track record of condo-hotels in terms of upkeep? Do all of the trends in the city’s tourism expansion bode well for the community?
In short, have the city officials given careful consideration to the trends in city property ownership, population and even business development to know that they are beneficial developments? Without that sense of certainty, is it appropriate to reject Mita’s proposal without thorough exploration? Is that the way communities should deal with proposals for major investment?
One high level presentation to council in 2021 does not constitute the city doing its due diligence. The purpose of the redevelopment designation is to allow a municipality to facilitate the development of a blighted and underperforming area in favor of a project that the municipality wants.
The question is, has the city learned enough to decide if it wants this project? Has the development of this site been carefully considered? In all likelihood, Mita and his potential investment will not go forward under the onus of the city’s normal processes. That is not because special favors were not granted. It is because it is probable that those normal processes would not result in the approval needed, especially since every move the various boards make will be subject to consideration as a precedent for the future.
Cape May needs to do its due diligence with this proposal. So far, the city’s leadership has not shown that it understands what the due diligence entails.
A yes or no decision follows from investigation and consideration, it does not preface it.
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From the Bible: Watch your step. Use your head. Make the most of every chance you get… Don’t live carelessly, unthinkingly. From Ephesians 5
