When Councilman Ralph McMorris presents his plan for a proposed “South Beach” project to the Galveston City Council on Thursday, listen for the numbers. The interesting parts of this plan are its financial implications.
McMorris is a critic of building high-rise hotels on the beach. He argues that doing so would be a financial disaster, from the public’s point of view, anyway.
He’ll get to make his case Thursday.
McMorris contends the city should buy up private property south of the seawall and convert it to a public beach. He’s particularly focused on the largely undeveloped, privately owned land from Porretto Beach to the east.
In widely publicized cases, the last City Council granted specific-use permits that exempt two seawall properties from rules that limit the height of buildings.
McMorris contends that political decision added value for the landowners. What the City Council didn’t consider was the erosion of the value of property behind the seawall, McMorris said.
For example, if a new hotel tower were built on the beach, would people who had bought condos on the north side of Seawall Boulevard with views of the Gulf go to the appraisal district and ask for a reduction in their property values? McMorris contends that’s likely, and some of his strongest supporters live in condos in Emerald by the Sea. McMorris also contends the developers of a new hotel on the beach would lock those improvements in a Tax Increment Reinvestment Zone. That means that the public wouldn’t see the benefits of increased tax revenues for years.
McMorris proposes that the city use its Redevelopment Authority to buy up the private property. The public property would be added to Stewart Beach and redeveloped as “the only significant urban beach in the Houston region.” McMorris’ proposal covers about 95 acres, making it comparable in size to Miami’s famed South Beach — hence the name.
Much of the public discussion has involved the idea of redeveloping Stewart Beach.
Less attention has been paid to the financial argument of whether it makes more sense, from the public’s point of view, to acquire the property south of Seawall Boulevard to protect the tax base to the north.
It’s an interesting argument.
At the very least, the council should consider conducting a feasibility study.