Sunday, March 4, 2012

Another item to keep an eye on when the business plan for the UCLA hotel/conference center is released: Non-commercial use

A post on this blog yesterday noted that with the upcoming Regents meeting in late March, UCLA will soon have to release its business plan for the proposed hotel/conference center if it wants to get it on the agenda. So far, no plan has been released despite an official public records request for a copy from the UCLA Faculty Association.

The preliminary description of the proposal indicated that the hotel/conference center would take only non-commercial business.  An example could be a campus-sponsored research conference and participants in such events.  The non-commercial limitation allows for tax-exempt financing but limits the potential use of the hotel/conference center. It thus raises issues of whether resulting revenue can cover costs.  Commercial use that would violate federal tax code requirements could create problems for UCLA and, indeed, the entire UC system.  An interesting question, therefore, is what the business plan will define as a legitimate use of the facility.  UCLA is not going to default on its financial obligations so if revenue turns out to be below cost, one way or another the campus will have to make up the difference.

We continue to wait for the business plan but note that time is marching on:

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