Mar 29
2024
OTB considering hotel expansion at Batavia Downs
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The board of directors for Western Regional Off-Track Betting Corp. agreed on Thursday to hire two companies to help explore the possible expansion of the 84-room hotel at Batavia Downs in Genesee County.
Approval of the agreements came over the objection of one board director — Erie County’s representative Tim Callan, who said he still has questions about how management arrived at the two vendors chosen to do the work.
“Management did not answer my questions to my satisfaction,” Callan said following Thursday’s meeting.
The board, minus Callan, authorized one contract for $76,000 with Bammel Architects, an Orchard Park firm hired to develop architectural designs for the proposed hotel expansion project.
In another move where Callan also cast the lone “no” vote, the board agreed to enter into a $29,750 contract to allow Spectrum Gaming Group to perform a gaming market analysis that would shed more light on the potential pros and cons of hotel expansion.
Callan said he struggled to understand why the corporation would hire one company to develop drawings for the project and, at the same time, hire another company to perform a feasibility study to determine if the project makes sense.
He also said he asked earlier this week for President and CEO Henry Wojtaszek and other members of OTB’s management team to provide him with more details about the process in which the two contracts were awarded, including whether the corporation solicited bids through either a request for proposals or a request for qualifications. In response, Callan said he was told only that management employed a “competitive process” in both cases.
“What kind of a competitive process?” Callan said following the meeting.
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The Batavia Daily News reported last April that members of the board’s expansion committee discussed the possibility of spending between $50,000 and $100,000 to perform a feasibility study and hire an architect to develop drawings of the proposed hotel expansion.
Following Thursday’s board meeting, Wojtaszek said the expansion proposal currently under consideration would involve 48 additional rooms. At this point in the process, he said the corporation did not have a potential cost estimate for the project.
Wojtaszek said the recommendation to consider expanding the hotel came from David Hart, president of Hart Hotels, the private company that manages the hotel for OTB. He said it is also based on strong occupancy numbers for the hotel in recent years.
“Occupancy has been at 96 percent for the last four months,” Wojtaszek said.
OTB Erie County representative Timothy Callan. Photo by Garrett Looker.
Thursday’s meeting was the first in which Callan had legal authorization to participate as a voting board member. He was appointed in December by Erie County Executive Mark Poloncarz to fill the seat previously held by Poloncarz’s earlier designee, Jennifer Hibit. She resigned after the state Gaming Commission, citing state law, said she could not serve on the board while holding her position as secretary of the Erie County Democratic Committee.
Callan is the deputy comptroller for Erie County and his boss, Erie County Comptroller Kevin Hardwick, has frequently clashed with OTB officials in the past.
In 2022, Hardwick pressed OTB officials for more details regarding the corporation’s purchase of the hotel, noting in a letter to Wojtaszek that OTB’s board authorized the sale of 35,000 square feet of property at Batavia Downs to a group of investors for $605,000 back in 2015. The investment firm, ADK Hospitality LLC, bought the land for the purpose of building a hotel on-site. State records show ADK formed one month before the land sale was approved.
In his letter, Hardwick referenced “various reports” indicating that ADK spent between $5 million and $5.5 million constructing the building and that, in a deal finalized in July 2020, OTB’s board agreed to purchase the hotel for $7.5 million, what the comptroller described as a “considerable markup.”
Hardwick asked Wojtaszek why OTB would engage with an investment group that had never developed a hotel before. He asked for more detailed information about how OTB determined the sale price of the land, who initiated the deal and how much money OTB has spent on rooms in the hotel, before and after it owned it.
Callan said his office is still waiting for answers to some of its questions about the hotel deal.
“A large number of our questions vis-a-vis my day job role were not answered by the corporation in the last couple of years,” he said.
When asked if his objections to the award of both contracts had anything to do with his office’s investigation into the hotel deal in the past, Callan said it wasn’t the main factor but it was part of his consideration.
“While I wouldn’t say that played a role in my decision as a director now with voting on these two resolutions, that’s certainly in the back of my mind about previous processes with the hotel,” Callan said.
