Tuesday, April 01, 2008

You Get What You Incent

Akron City Coucil is shocked. Shocked! That David Brennan wants the city to accept a write down of $1 million on a loan for the on-its-way to insolvent Radisson Hotel

Having started down this path with providing subsidies to Goodyear, Bridgestone / Firestone, and the Akron CitiCenter Athletic Club subsidy, it ill behooves council to snivel when other members of Akron’s business community line up at the public trough.

So: the options are to a) take Brennan’s deal – He’s willing to pay off $1.5 million of the $2.5 million balance; or b) decline, and possibly force the hotel into bankruptcy, where the city’s loan is not the first debt to be paid on the list.

If the city picks option b), the uncertainty over the hotel may further impact Akron’s convention business, such as it is., or the hotel may close. Finding another buyer in this economic climate for a hotel in Akron may take a while.

And while were waiting, having a large empty building downtown doesn’t do much for the city either.