ROCKVILLE – If there are any issues with clear cut lines between the Team Rockville candidates and their independent opponents, it’s the Adequate Public Facilities Ordinance and development.
In general, the four City Council candidates and mayoral candidate running on the Team Rockville slate supported the 3-2 vote from earlier this year.
It aligned the city’s APFO with the standard set out by Montgomery County, which puts a moratorium on residential development near schools that are at 120 percent capacity. The city’s former standard was 110 percent.
For commercial development, one of the key issues in the race between Team Rockville and independent candidates are incentives allocated from the city to Choice Hotels.
Mayor Bridget Donnell Newton and former Council member Mark Pierzchala cast different votes over Choice Hotels when they served on council together before opposing each other in the 2013 election.
Newton won the election and now faces Sima Osdoby in the general election this year. Osdoby is the mayoral candidate for the Team Rockville slate, which includes four City Council candidates: Pierzchala, council members Virginia Onley and Julie Palakovich Carr and Environment Commission chairman Clark Reed.
Pierzchala voted in the majority twice for the Choice Hotels deal while Newton, then as a council member, abstained.
Since then, Newton has said throughout the campaign that she did not oppose Choice Hotels locating its headquarters in Rockville but disapproved of the city offering cash incentivizes to a publicly traded major corporation.
“I’m still not convinced that public money should be given to publicly traded companies,” she said during a September interview.
Newton’s viewpoint is backed up by independent council candidate Patrick Schoof, who endorsed her candidacy.
Although Schoof called having Choice Hotels’ headquarters in Rockville “a win,” Schoof added they went wrong by giving “a multi-billion dollar corporation who wanted to be in Rockville” waivers and waived fees.
Pierzchala said the council made the right decision to incentivize Choice Hotels.
“So when you’re an elected official and you’re deciding on an incentive, you’re saying will the incentive attract the business and is it worth it or not,” said Pierzchala.
According to the economic development fund agreement between Montgomery County, the mayor and council of Rockville and Choice Hotels International Inc., the city is to pay back the County $156,000 over six years for the Choice Hotels deal.
The county fronted that much money to the hotel corporation and is receiving payments of $26,000 once a year from the city.
“It’s a no interest loan, basically,” said Pierzchala
On top of the direct financial incentive, the mayor and council agreed to provide up to 275 parking spaces at a reduced rate in the Town Square public parking garages for a period of 10 years.
However, Federal Realty Investment Trust has taken over the management of the City-owned parking garages.
“We were spending a lot of money on them,” said Pierzchala about the garages. “It’s millions upon millions of dollars that the deal saved the city.”
A City Council briefing document from Nov. 5 2012 cited separately by Pierzchala, who organized Team Rockville, and local resident Drew Powell, who donated to all six independent candidates, offered three other city incentives.
A “new jobs tax credit” allowed Choice Hotels to be “eligible for a real and personal property tax credit,” depending on capital investment and the assessment rate for up to six years.
Next, a $180,000 permit fee waiver “applies to plumbing, tap, building, electrical, mechanical, fire protection, occupancy and Public Works permits” for Choice Hotels.
According to the document, “Should the applicable fees total less than $180,000, the agreement indicates the difference will be added to the City’s Conditional Grant to Choice Hotels.”
Third, an expedited permit review allowed staff and the council to prioritize the deal so it could be approved quickly.
At question is just how much money the tax credits and waivers actually total.
“It’s not $186,000,” said Schoof. “It’s millions of dollars over many years.”
“It could be a wash. It could be positive,” he added. “But if we’re just looking at the numbers, this will cost the city more for at least the first six years than the city will make.”
However, to Pierzchala, the city made the right and necessary decision by approving the incentives.
“Our part of the incentive is very modest, let’s put it that way,” said Pierzchala, noting Choice Hotels also received incentives from the county and state, which have considerably higher budgets. “They found Rockville attractive but they had other options in Montgomery County.”