PITTSBORO, NC— Chatham County will receive public comments at its August 15, 2016 session on one-time incentives for a proposed 100-room hotel in Pittsboro, vital to positioning the new Agriculture & Conference Center as a site for conventions and other large events. The hotel is expected to have a $4 million impact on the local economy.
“It is important to note that no incentives would be paid out until the hotel pays its property taxes,” said County Manager Renee Paschal. “The total of incentives is based on percentage of property taxes paid by the hotel, so at no time will the incentives exceed the amount of property taxes paid by the hotel.”
The hearing, which was originally advertised for the Historic Courthouse, will be part of the 6 pm session that has been moved to Chatham Central High School’s auditorium due to another agenda item. The high school is located on NC 907 in Bear Creek in southwest Chatham.
“This is a huge step for Chatham County to finally have a hotel in the Pittsboro area that will help draw crowds and overnight guests to events at the Agriculture & Conference Center,” said Commissioner Chairman Jim Crawford. “Right now, we rely on several wonderful small bed and breakfasts for lodging, but these rooms are sufficient for large events. The closest hotel is more than 17 miles away.”
The hotel would be part of the Russet Run development, a phase of Chatham Park developed by the Eco Group. Located on US 15-501 across from Northwood High School, the development will include the hotel as well as a brewery, senior living center, movie theater and grocery store.
Kyle Touchstone, president of the Chatham Economic Development Corporation (EDC), said that the hotel will be a catalyst for additional growth in jobs, tourism, overnight visitors, and higher sales tax and occupancy tax revenues. “We expect the hotel to invest about $14 million to build the facility and to add about $392,400 in annual sales tax revenues, both directly and indirectly.”
Neha Shah, director of the Pittsboro-Siler City Convention & Visitors Bureau, agreed that a hotel is vital to the success of the Agriculture & Conference Center and for tourism growth in the county. She said, “It is expected to bring in $102,000 in occupancy tax revenues per year, which will help us promote the conference center and attractions in the county.”
Touchstone reported that a study by the Economic Leadership found that the hotel will have a multiplier effect that will generate more jobs and sales in the community. For example:
- The hotel is likely to employ 25 people, but will lead to another six jobs in the community, for a total effect of 31 jobs.
- The hotel’s $675,960 in annual salary earnings will lead to another $155,471 in local earnings.
- The hotel’s estimated annual sales of nearly $3.4 million will generate another $592,000 in local sales.
The construction of the hotel will create about 100 temporary jobs plus another 20 indirect jobs.
Hotel officials have stated that incentives are needed to make this a viable project, due in part to being the first hotel in an untested market. The recommended incentive level would refund the hotel the following percentages of annual property taxes over the first five years before ending in Year 6:
Year 1 – 90%
Year 2 – 80%
Year 3 – 75%
Year 4 – 75%
Year 5 – 60
Year 6 – 0%
“Before any incentives are paid, the company must meet other requirements and must pay their full county property taxes on time,” Paschal said. “If these conditions are met, then we would be paying incentives based on a portion of the property taxes already paid for five years.”