The Lawrence City Commissioner approved a settlement in the city’s lawsuit against the Oread Hotel at its meeting Tuesday night. The settlement will cut millions from the hotel’s incentives agreement.
Thomas Fritzel, the hotel’s developer, will be forced to resign from his management position after being accused of fraud and racketeering. His resignation will last for the remainder of the hotel’s 20 year incentives agreement.
Terms of the settlement include:
- The Oread reimbursing the city of Lawrence $650,000 and agreeing to reductions in the hotel’s incentives agreement.
- Fritzel resigning as manager of the Oread Hotel and hotel managers being subject to city approval.
- Fritzel and any entity that he or his wife are affiliated with agreeing to a five-year ban on seeking incentives from the city that involve sales tax reimbursements.
This agreement was intended to partially repay the developer for the infrastructure improvements made to the area surrounding the hotel during the 2008 construction. It essentially created a separate taxing district at the hotel’s address that required the city to repay the development group a large percentage of local sales taxes collected.
Commissioner Matthew Herbert shared his thoughts on the decision following public comment.
“We take a $492 thousand dollar debt that we’re owed, we turn it into potentially $1.3 million in payout, plus a 2.5 reduction in what we would have to share. This is a win for the city of Lawrence and our taxpayers. This, from a dollars standpoint, is a no-brainer,” Herbert said. “This is absolutely a win for the city.”
The settlement was approved unanimously by the commissioners.