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In Our View / Everett's hotel deal

A matter of time, money

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Seattle fans know the feeling: groaning as their team snatches defeat from the jaws of victory.
Political partisans have experienced it: shaking their heads as a front-runner trips on his tongue and sinks in the polls.
And many railbirds have endured the torment: muttering as a favorite in the fifth race at Emerald Downs finishes out of the money.
When you're rooting for something, you hate to see it fade away.
Our city, our county and our region have seen plenty of promising projects go the way of delay, entropy and eventual abandonment. We could recite the list, but why rip bandages off old wounds?
One unfulfilled ambition is a plan to construct a 156-room Courtyard by Marriott hotel in downtown Everett. The optimistic expectation is that nearby Comcast Arena would ensure business at the hotel -- and a nearby hotel would stimulate attendance at the arena.
Under a deal with the city, the project is supposed to break ground by the end of this month, but it has not achieved liftoff. Touchstone Corp. of Seattle has only $7 million of the $27 million needed to finance the development.
In the coming days, the Everett City Council must choose among three options: give the developer a year's extension, force Touchstone to pay the city $1.1 million for the land (which has been part of a swap), or cancel the project outright.
To weary ears, Mayor Ray Stephanson's support for an extension may sound like a familiar death rattle. Here we go again, desperately hanging on to a losing proposition. But, in this case, an extension seems reasonable.
The hotel is planned as an EB-5 immigrant investment project. This 23-year-old federally supervised program would allow Touchstone to solicit $20 million from people outside the United States. Forty different investors could pony up $500,000 a piece and, in return, receive residency papers for their (presumably) well-heeled families.
The catch? The project must create jobs; in the case of the Courtyard hotel, it needs to create 400 jobs.
In recent months, the federal government has taken steps to clarify -- meaning, to complicate -- what investors must do to qualify for the EB-5 program and how job creation should be measured. So, projects depending on this kind of financing are bogged down.
Worst case scenarios? The logjam can't be cleared up in time to salvage Everett's hotel project. Or, under stricter interpretation, the project no longer qualifies as an EB-5.
It will take time to sort out these questions and, for now, Everett is in a position to grant that time.

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