The Puri Group won't get city taxpayers' help to redevelop the nine-acre Truman Hotel site in the 1500 block of Jefferson Street.
Because Jefferson City's TIF Commission rejected the proposal earlier this year, state law required a two-thirds council vote to approve the project - but Jefferson City's Council only voted 5-5 near the end of a nearly four-hour meeting to approve tax increment financing (TIF) for the project.
The Puris were seeking an $8.89 million TIF toward an estimated $56.8 million project cost.
Raman Puri, vice president and CFO of Puri Group Enterprises, told the News Tribune he was disappointed in the council's vote because it was discriminatory.
"The (Capital) Mall TIF was approved, and this (hotel project) was a better project, with more money to the community," he explained.
Before the vote, Second Ward Councilman Rick Mihalevich told colleagues: "Each TIF should stand on its own merit - we voted for the mall on reasons we thought were valid at the time."
But he was one of several council members concerned part of the proposed contract with the Puris involved using lodging taxes collected at the new hotels - and at two other hotels the Puris own that currently are outside the city limits but would have been annexed voluntarily to help pay for the TIF.
"Nowhere does this contract say this money goes dollar-for-dollar into remodeling" the Truman conference center - the building closest to Jefferson Street, which also housed the restaurant and lounge, Mihalevich said.
But, Third Ward Councilman Ken Hussey said, "A project like this grows that (lodging tax) fund."
He added: "We need development and we need growth in Jefferson City, and this is an opportunity to do that."
Hussey was joined in voting for the project by: Laura Ward, Second Ward; Erin Wiseman, Third Ward; Glen Costales, Fourth Ward; and Larry Henry, Fifth Ward.
Council members voting against the project were: Rick Prather and Jim Branch, First Ward; Mihalevich; Carlos Graham, Fourth Ward; and Mark Schreiber, Fifth Ward .
The Puris reminded the council they had bought the old Truman Hotel property when no one else would, and the previous owner said they would close the old hotel if no one bought it.
Their project would have resulted in the current, nearly 50 year-old hotel buildings being razed and replaced by two new hotels offering 260 rooms, with the existing conference center also being renovated.
Council members heard from 18 different people before the vote was held, with eight opposed to granting the TIF and 10 - including two members of the Puri family - endorsing it.
As they have in previous meetings, several of the opponents questioned the Puris' estimates as being too high.
But Raymond Puri reminded the council the proposal is a "pay-as-you-go" project - if it ultimately costs less than estimated, the TIF payments would be less. "We have to submit all the receipts and all the bills," he said.
Previous coverage of the Truman Hotel TIF:
No votes on TIF, blight by council, Sept. 7, 2016
Truman Hotel TIF delayed further, Aug. 14, 2016
Truman Hotel TIF: What happens next?, June 26, 2016
Jefferson City TIF Commission rejects Truman Hotel proposal, June 23, 2016
Board opposes TIF project for 'philosophical' reasons, June 23, 2016
New Truman Hotel funding plan proposed, June 19, 2016
Truman Hotel TIF decision delayed again, June 1, 2016
JCPS expects new TIF proposal, May 24, 2016
Developer meets with JCPS board to discuss TIF, May 10, 2016
Truman Hotel TIF meeting rescheduled, April 12, 2016
Schools historically have little power in TIF decisions, April 10, 2016
JCPS balks on proposed Truman Hotel TIF, April 6, 2016
Truman hotel seeking Tax Increment Financing for proposed developments, March 20, 2016
Truman Hotel closes, Dec. 4, 2015