DATE: Sunday, May 25, 1997                  TAG: 9705250040

SECTION: LOCAL                   PAGE: B1   EDITION: FINAL 

SOURCE: BY JON GLASS, STAFF WRITER 

DATELINE: NORFOLK                           LENGTH:  131 lines

COUNCIL MEANS BUSINESS AT WATERSIDE FINANCIAL LURE PUSHES ASIDE OTHER CONCERNS

City Councilwoman Daun S. Hester knew that many women find Hooters restaurants offensive - from the name, slang for a woman's breasts, to the waitresses-as-sex-objects in tight tank tops and short shorts.

But she also knew this: Hooters is a reputable national chain with a track record of success and drawing crowds - something downtown Norfolk's Waterside marketplace needs if it's to keep afloat.

So, Hester said Friday, she set aside personal feelings when she and her six male colleagues on the City Council recently blessed the use of $300,000 to renovate a space in Waterside for a Hooters.

``If I had put gender into it, I would have said, `No,' '' Hester said. ``But I had to think like a councilwoman. People are always complaining about what we're subsidizing, so we're trying to get to those things that will pay their way - which is key.''

The arrival of Hooters in Waterside has put a new twist on the long-running debate over the millions of dollars Norfolk is spending to revive downtown - while many pressing needs in the community go unattended, some taxpayers argue.

There is no shortage of opinions on Hooters.

``They could have used that money to fight drugs and keep kids off the street and fight blight,'' said Wilma Suiter, president of the Oakwood Civic League. ``That's a chain restaurant, and they should be able to put up the money on their own. If they're going to start financing businesses, I can open a business and they can finance me.''

Ben Rogerson, a retired city police captain and president of the Elizabeth Park Civic League, said: ``Why are we continuously sinking money in that area when a lot of neighborhoods go lacking in so many ways? We're short on money for our schools, yet they can always find money for downtown.''

According to city and Waterside officials, the agreement with Hooters is a sweetheart deal for Norfolk's residents.

For starters, Hooters will put up at least $300,000 for the renovation of its first-floor riverfront space at Waterside.

And based on sales projections, the city will recover its $300,000 up-front investment in less than two years from taxes and lease revenue paid by Hooters, said R. Vann Massey, Waterside's vice president and general manager.

During its 10-year lease with Waterside, Hooters is expected to generate slightly more than $1 million in tax revenue, including meals and sales taxes. In addition, Hooters will pay about $1.7 million in lease revenue, based on a percentage of the restaurant's gross sales.

That $2.7 million represents a rate of return of 800 percent on the city's $300,000 investment, Massey said.

``That's an incredible deal,'' Massey said.

City Hall considers Waterside, built in 1983 and privately owned, a major player in downtown's redevelopment.

Taxpayers have a financial stake: Norfolk's Redevelopment and Housing Authority owns the riverfront land where Waterside was built and also has underwritten loans to construct and expand the attraction.

Since 1990, Norfolk has spent about $2.4 million to cover operating shortfalls since Waterside took on more debt to expand, officials said. During the same time period, however, businesses in Waterside have returned about $9 million in tax revenue to the city.

In the coming year, Waterside is expected to pump in more than $2 million in taxes.

``We're in the business of trying to make money as well as to provide an amenity,'' Massey said.

And that's at the core of city officials' arguments for why they are investing so much money downtown: The expanded tax base and other financial spinoffs will make more money available for schools and other needs.

The social debate over Hooters' locating at Waterside is more difficult to argue than the financial benefits, officials acknowledge. Massey said he lost a female friend over the deal.

And City Council members say they've fielded calls from angry constituents who don't think Hooters fits Waterside's family-oriented image.

In promotional literature, Hooters estimates that 70 percent of its clientele are men, and describes its restaurants as ``delightfully tacky, yet unrefined.''

``I understand some people's objections to Hooters,'' said Mayor Paul D. Fraim. ``But I think, by and large, the image of Hooters is one of a well-run, cleanly run establishment that is able to draw customers, and that is what we're trying to do.''

The City Council does not have veto power over the tenants Waterside chooses, but it could have used political persuasion or refused to appropriate the $300,000 for Hooters, officials said.

``I guess if we had raised enough stink we could have had it not come in,'' Hester said.

The council did not take a separate public vote on appropriating the money, part of a $1.1 million payment to the Redevelopment and Housing Authority included in the 1997-98 budget for maintenance and tenant allowances at Waterside.

Council members said they discussed money for Hooters privately with city staffers in a closed meeting several weeks ago. The discussion involved proprietary business information about Hooters and details of the lease agreement, items that qualify for executive sessions under Virginia's Freedom of Information Act, officials said.

City officials said the Hooters matter was handled no differently than any other proposed business contract the council discusses.

Hester said she suggested during discussion that other restaurants be considered. Other council members also said they raised concerns but went along after being convinced of the financial benefits to the city.

Hooters is located in other waterfront marketplaces on the East Coast, including Miami, Jacksonville and Baltimore. Massey said he received nothing but favorable reviews from landlords, who told him those Hooters were ``extremely profitable and always pay their rent.''

A Hooters located on Military Highway for several years has caused ``absolutely no problems at all,'' he said.

``They are a beach-themed restaurant and they create a fun atmosphere,'' Massey said. ``I think most of the people who criticize don't know what it is and have never been in one.''

Gil Stotler, a spokesman for the Baltimore Area Convention and Visitors Association, said there were some ``minor protests by a few women's liberation groups'' when Hooters opened in Harborplace several years ago. But the issue ``just kind of went away.''

Mike Shaver, general manager of the Waterside Hooters, said the restaurant has made one concession: Instead of outfitting waitresses in midriff-exposing tank tops, the women will be required to tuck the shirts in their shorts.

Shaver said the Hooters, which will open early next month, may attract other big-name businesses to Waterside - besides drawing conventioneers and tourists.

``Hooters is a destination restaurant,'' Shaver said.

Sybil Stone, president of the Norfolk Federation of Civic Leagues, said she personally is unhappy about Hooters at Waterside, saying the restaurant ``makes a sexist statement about women.'' And she hopes it doesn't set a precedent for turning downtown into a ``nightclub city.''

But she, like Hester, takes a broader view.

``We need to be concerned about providing diversity for tourists to keep them coming back, even from a regional perspective,'' Stone said. ``For every tourist dollar that comes in, that's one that doesn't come from taxpayers.'' ILLUSTRATION: Hooters logo

Send Suggestions or Comments to webmaster@scholar.lib.vt.edu