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NSBNews.net file photos /NEW SMYRNA BEACH -- Four years ago, a series of city commission meetings led by then-Mayor Sally Mackay, were heavily attended by merchants and chamber leaders on the beachside's Flagler Avenue who lobbied for special zoning that would pave the way for a new hotel: The $16 million Hampton Inn & Suites.
Those rallying cries were led by Steve Dennis, then-Southeast Volusia Chamber of Commerce director and CRA commission member, and Robert Wayne Lott, the president-elect of the chamber, a member of the Southeast Volusia hospital board taxing district and purchaser of the weekly Observer newspaper with his wife, Michele Lott.
What wasn't known to the general public in 2008, but revealed just a couple of months ago in a public filing, was an application from the Lotts seeking protection in federal bankruptcy court from the chief developer of the Hampton Inn project, South Carolina-based David Swentor and his Premier Development business partner, David Tart, each of whom gave them $23,000.
The public record portion of the bankruptcy filing did not reveal what the money was owed for beyond listing Swentor and Tart by name and the amounts they were owed. The Lotts have refused repeated inquiries for comment by NSBNews.net.
The Observer ceased printing in November just seven months after the newspaper was relocated from Robert Lott's then-owned "Lott Financial Services" suite on Flagler Avenue to their Edgewater home on Riverside Drive, which also went into foreclosure proceedings that summer. The Lotts sought bankruptcy to stave off hundreds of creditors, including newspaper subscribers, collectively owed nearly half a million dollars.
Other major creditors besides the Hampton Inn developers and the bank holding the mortgage on their home, were three current or former members of the SE Volusia hospital board who invested in the Observer, several credit card companies and their own attorney, Kenneth W. Bohannon, the immediate past president of the SE Volusia Chamber and a planning board member, whose votes helped move the Hampton Inn project along.
The Lotts sought protection as well in bankruptcy from an 82-year-widow, Barbara Crosby, who sued them in circuit court in Volusia County, claiming she was defrauded $60,000 by the Lotts in investing in the newspaper.
Bohannon, the attorney of record for the Lotts in their home foreclosure suit and in their defense against the elderly widow's lawsuit, has repeatedly refused comment to NSBNews.net.
The $46,000 given by the hotel developers to Robert and Michele Lott begs the question: Would as many people have shown up at those early city commission meetings clamouring for the hotel had the Lotts not received the $46,000?
A host of city officials and merchants alike said they were unaware of the financial arrangement. Regardless they believe the hotel is vital to New Smyrna Beach's growth.
David Swentor agreed, saying there was a demonstrated need for the hotel by the business community and the chamber. Swentor said his motivation for giving the Lotts $46,000 up front was strictly to help get the longstanding community newspaper up and running.
"They asked for help and we felt it was important to help them get the newspaper running again under new ownership," Swentor said, explaining the Observer agreed to run advertising from what was advanced to market the hotel once it was built.
"They asked for help and we felt it was important to help them get the newspaper running again under new ownership," Swentor said, explaining the Observer agreed to run advertising from what was advanced to market the hotel once it was built.
But the Observer ceased publication last winter, less than four years after the Lotts acquired it and Swentor and his business partner, David Tart, were not paid back.
Asked how he felt about the Lotts seeking bankruptcy protection for the $46,000 owed to the two principals in the development, Swentor declined comment.
"Im not going to get into that," Swentor said, speaking on behalf of Tart as well. "I'd rather focus on the benefits of the hotel for Flagler Avenue and New Smyrna Beach."
The weekly folded in mid-2008 under its Indiana-based corporate owners, Horizon Publications. The Lotts bought the paper from Horizon for a purported $20,000, according to Doug Hodson, former general manager of the News-Journal Corp.-owned New Smyrna Beach Pennysaver.
The Observer was registered with the state under "Coronado Beach Publishing LLC" with Michele Lott as the sole officer. The newspaper was opened on Canal Street, but after financial struggles, it was moved to Flagler Avenue, Hodson said.
Hodson, who later briefly worked for the Observer, said the Lotts only paid Horizon half the $20,000 and the former owners wrote it off as a loss. Like Dennis, Hodson, too, was on the CRA commission before abruptly resigning last winter just months after Dennis.
Three other longtime CRA members abruptly resigned amid questions of conflicts of interest and other matters. Four replacement members said they were no longer interested in serving, leading to the city commision directly taking over their responsibilities last month.
FAST FACTS
Opinions divided on sprawling hotel for quaint Flagler Avenue
NEW SMYRNA BEACH -- More than a hundred people agreed a world-class hotel for this tourist-oriented seaside community would boost the local economy by millions, but there was sharp division whether quaint Flagler Avenue with its charming boutiques would be ruined by a towering structure with as many as 150 rooms.
Mayor Sally Mackay was able to gain a majority vote on the City Commission for approval of a hospitality land-use development that could be built as an "overlay" in a commercial district such as U.S. 1, State Road 44, East or West Canal or the causeway corridors. And yes, even historic Flagler Avenue.
Editor's Note: For the rest of the story on our coverage of the the effort of Steve Dennis and Robert Lott, vote for special zoning required zoning as a precursor to the building of the hotel, click the link below.
http://nsbnews.net/content/opinions-divided-sprawling-hotel-quaint-flagler-avenue
Here is a quote summary from Lott that night:
Robert Lott, president-elect of the chamber, owner of Lott Financial on Flagler, a principal owner of The Observer weekly newspaper on Canal Street, a member of the Southeast Volusia Hospital Authority and chairman of the Edgewater Economic Development Commission, said a hotel on Flagler or anywhere else in New Smyrna Beach would bring in millions. "Don't cut anybody out of this opportunity," Lott implored the commission. "It would be totally unfair."