OGDEN -- The city council has approved $9 million in facility bonds to help finance construction of a four-story Hilton Garden Inn Hotel at The Junction development downtown.
Western States Lodging, based in Taylorsville, and Layton developer Kevin Garn are partnering to build the $13 million hotel and a $3 million underground, city-owned, public parking garage at 2275 Washington Blvd.
The facility bonds will be purchased by U.S. Bank but will be issued by the city so that Western States Lodging and Garn can take advantage of the municipality's tax-exempt status, said Janene Eller-Smith, a policy analyst for the city council.
Garn will be responsible for repaying the facility bonds.
The city council is scheduled to consider on Tuesday the issuing of about $2.8 million in assessment bonds to construct the parking facility. A special assessment area would be created to encompass the footprint of the hotel to repay the bonds.
In addition, the city council functioning as the Ogden Redevelopment Agency is scheduled to decide Dec. 21 whether to issue up to $3 million in tax increment bonds, Eller-Smith said.
The RDA would issue the bonds, with backing from the city, for hotel construction and the parking garage.
Tax increment financing is a tool that captures projected property tax revenue created by a development and then allows those funds to be invested for improvements associated with the project.
David Webster, a partner with Western States Lodging, said his company is looking forward to the finalization of bonds so construction of the parking garage can start by April and construction of the hotel can begin in June.
"It's an interesting project and one that we are excited about and want to bring to fruition," he said Wednesday.
The hotel will have 125 rooms and is slated to open in late 2012.
Western States Lodging has constructed numerous hotels in Utah, including the Hilton Garden Inn and Conference Center and Towne Place Suites, both in Layton, and Spring Hill Suites in Logan.
The company also is building Home2Suites, an extended-stay hotel for Hilton, in Layton.