Developer Lodgeworks planned to build a beautiful five-story, 125-room, upscale hotel in the coastal city of Long Beach, California. Likely salivating over the potential tax revenues that the project would produce, city officials approved the project. And, with unemployment on the rise, much of the community supported the project as well.
But the project is no more, at least for now.
The California Coastal Commission (that unaccountable state bureaucracy responsible for regulating coastal development) approved the project. But not without exacting its pound of flesh. The "problem" with the hotel, as the Commission saw it, was that it was "too" expensive. Therefore, it sought to extort about $1 million from the developer for "the provision of lower-cost overnight accommodations within or in close proximity to the coastal zone." Of course, by increasing the supply of hotel units in the area, Lodgeworks already would be doing its part in putting downward pressure on the average price of overnight accommodations in Long Beach.
So why make Lodgeworks pay extra? Presumably, because the Commission thinks developers, with their cash-filled coffers, can. Except Lodgeworks can't. After the Commission's decision came down, Lodgeworks announced it was indefinitely postponing the project. As Long Beach's Gazettes reported, one Lodgeworks representative explained that the fee "made the project even less economic . . . [i]n a difficult financing climate."
The Commission's extortionate demand not only raises serious legal questions, but also has imposed incalculable economic losses on the Long Beach community and others. Consider the jobs that never will be created, or the lodging opportunities that countless travelers never will enjoy, simply because the Commission thought there was a "need" for lower-cost accommodations. Now, thanks to the infinite wisdom of the Commission, there will be no new accommodations. For anyone.