Brevard County commissioners OK $30M marketing grant to Cocoa Beach Westin hotel project

Brevard County commissioners on Tuesday — ignoring its own advisory panel’s recommendation — approved a controversial proposal to grant of up to $30 million to the developer behind the planned Westin Cocoa Beach Resort & Spa, according to News 6 partner Florida Today.

The vote was 3-1. Voting in favor of the grant were County Commission Chair Kristine Zonka, Vice Chair Curt Smith and Commissioner Rita Pritchett. The sole vote against it was by Commissioner John Tobia.

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The money for the developer, Driftwood Capital, will come from up to half of the revenue the Westin expects to generate from the county’s 5% tourist development tax on hotel rooms and other short-term rental. The grant extends for 30 years, with up to $1 million available to the company each year.

The vote came in spite of opposition and a recommendation of “no” from the advisory Brevard County Tourist Development Council, as well as from Brevard County hoteliers and other local residents who addressed the commission before its vote.

Now, the issue could head to court. Daniel Mantzaris, an attorney representing Bob Baugher, the owner of hotels in the Cocoa Beach/Cape Canaveral tourism corridor, said he believes the grant is illegal.

He sent commissioners a five-page memo outlining his views on the issue and also addressed commissioners at Tuesday’s meeting.

“The proposed grant agreement is an unauthorized and prohibited use of the Tourist Development Tax,” Mantzaris said in his memo. “It has been conclusively determined that tourist development tax cannot be used to fund privately owned projects. Regardless of how it is presented, the subject project has not been constructed, and the documents and the funding analysis clearly establish the grant as alternative funding of capital improvements that will be privately owned. Further, the proposed grant agreement is a substantial change to the existing tourist development tax budget and to be approved requires a unanimous vote of the four current commissioner.”

Interim Brevard County Attorney Christine Schverak disagrees, and said the proposed use of the tax is legal and requires only three affirmative votes of the County Commission.

Supporters and opponents of the grant packed the County Commission chambers to express views on Westin’s proposal, with most of the 30 speakers indicating they were against the grant.

The project grant was backed by a high-powered local lobbying team hired by Driftwood that included former Brevard County Commissioner Robin Fisher, attorney Kendall Moore and former Brevard County Attorney Scott Knox.

Driftwood has maintained that it should get the $30 million grant because its project is “transformational” for the Space Coast tourism industry, and will benefit other hotels in the area. Driftwood also said it would have trouble lining up investors for what it says is a $388 million project without the $30 million commitment from the county for the marketing program.

The proposed 502-room Westin resort hotel and conference center would replace Driftwood’s existing 502-room International Palms Resort at that hotel’s State Road A1A site. The Westin would feature 11 food and beverage venues, a spa, three swimming pools, a fitness center, multiple retail locations, and a multistory parking garage to accommodate about 800 vehicles. The complex also would include about 50,000 square feet of indoor conference space and about 70,000 square feet of outdoor conference space.

Driftwood Capital Chief Financial Officer Glenn Wasserman said, within five years after opening, the Westin project would support 1,300 local jobs, and would boost tourism tax revenues by $3.1 million a year, as well as increase local sales tax and property tax revenue.

“A Westin, I think, is a game-changer for this community,” Commissioner Rita Pritchett said, not only for its positive tourism impacts, but also for boosting the value of the property and increasing property tax revenue. “It will have a long-term impact on our community and our quality of life.”

During a lengthy discussion, Tobia sought to persuade at least one more commissioner to oppose the grant, but was unsuccessful.

After the vote, Driftwood officials told FLORIDA TODAY they were pleased by the outcome.

“We are very excited about the grant award,” Wasserman said. “It is something that we were looking for, and we have worked diligently to come up with the structure that would benefit the county, benefit the community, and help us secure the financing that we are going to need in order to develop the property.”

Carlos Rodriguez, chairman, chief executive officer and founder of Driftwood Capital, said that “this will definitely benefit the community and the whole of Brevard County.”

Rodriguez said that “with higher real estate taxes coming from that property, that basically allows the commissioners not to increase the millage rates, not to increase taxes on Brevard County citizens. We are getting a little piece of new dollars, but it is from tourists, not from residents, and the Brevard County residents are getting the impact of all these new tourists coming in and buying in their shops, eating in their restaurants. We cannot accommodate everyone coming to the convention center, so we are going to generate a lot of room nights for fellow hoteliers.”

The Tourist Development Council — an advisory board to the County Commission — did not support Westin’s request. Instead, the panel previously voted 7-1 to support a marketing grant to Westin of up to $500,000 a year for seven years — a total of up to $3.5 million — with the Office of Tourism staff and not Driftwood responsible for coordinating the marketing effort. That proposal was introduced by Tourist Development Council member Giles Malone, who is a partner in the Space Coast Daily media company, as well as a partner in an event and sports management business.

This alternative proposal was not discussed during the County Commission debate on Tuesday.

Cocoa Beach Mayor Ben Malik and City Commissioner Mike Miller were among those supporting Driftwood’s proposal.

Malik said the Westin would replace the “eyesore” that the International Palms is and a location that have had numerous police calls.

But, in questioning Malik and Miller, Tobia noted that the city of Cocoa Beach did not approve any grant money for the project.

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