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Kalahari incentives add up to $61 mil page 2
City releases Kalahari incentives

  • BLOG: Read more on the incentives.

  • Date published: 1/9/2008


    The agreement calls for the city to raise its lodging tax from 5.5 percent to 6 percent before the resort opens. Also, the city would raise the admissions tax in the Celebrate Virginia tourism zone alone from 5 percent to 6 percent before the resort opens.

    Kalahari will buy water from the city at a reduced rate that basically amounts to what it costs the city to buy the water from Spotsylvania and transport it to the resort. That rate will rise with the city's water costs.

    In order for the tax rebates and other parts of the agreement to continue for 20 years, Kalahari must make a $25 million investment in the second phase of its project, which would include 200 more hotel rooms and more water park space, within 10 years of opening. If not, all the tax breaks stop after 10 years.

    The council will have a special meeting at 7:30 p.m. on Jan. 15 to hold a public hearing on the incentives deal, which has been posted to the city's Web site.

    The council could vote on it Jan. 22.

    Council members would likely get a more detailed performance agreement that would govern the distribution of the incentives at a meeting in March.

    In the meantime, the city plans to hire an outside consultant to analyze what costs the city is likely to incur because of the resort.

    The details of the incentives were released shortly before last night's city council meeting, after a 36-minute closed session that included more city staff members than council members.

    Council members approved the basic framework of this package at a closed session before Kalahari announced its plans for Fredericksburg in November.

    Emily Battle: 540/374-5413
    Email: ebattle@freelancestar.com

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    For more on last night's discussion of the Kalahari incentives, and for a link to the document, click on the City Beat blog at Fredericks burg.com/blogs.