Dickinson officials: Hotels are for tourists too; Planning and Zoning Commission to discuss 3,000-worker facility
Dickinson officials predict crew camps to handle housing of temporary oil industry workers will have lesser impact on local hotels than one business owner believes.
Officials received a letter from Jeff Stockert, a Dickinson native and part owner of My Place Hotel in Dickinson, on Wednesday, in which he expressed concern for what a crew camp could do to business at local hotels, suggesting that construction of a crew camp should be scaled back.
"I am not suggesting to you that the best course of action is to deny the accommodation project. What I am suggesting is that perhaps the project should 'walk before it runs.' What would be wrong with permitting 400 units, for example, to measure impact and then go from there," he wrote.
Earlier this month, Accommodate International out of Austin, Texas, proposed building a facility on Energy Drive to house 3,000 workers. Construction could start this summer.
The issue is on the agenda for Wednesday's Planning and Zoning Commission meeting, which begins at 7 a.m. at City Hall, 99 Second St. E.
Planning and zoning will make sure requirements are met and discuss issues surrounding the camp.
Shawn Kessel, city administrator, said if there is a recommendation Wednesday, it would then go to the city commission for approval.
But Kessel said it is more likely that a smaller facility would be built first.
"The intention is not to build a facility for 3,000 people right away," he said. "A smaller facility would be built in a first phase and hopefully completed the first phase by November if approved. It's unlikely that a 3,000-person facility would be completed right away because we would need to see what the demand was like first."
The temporary facility would offer food and beverage service, game rooms, laundry, arcades, mail service, exercise rooms, Wi-Fi, computer rooms and television relaxation areas.
The facility would be configured into four buildings three to four stories high on 44 acres.
The temporary housing won't be around forever, though.
City Commissioner Klayton Oltmanns said Dickinson needs to focus on making sure the hotels are occupied by tourists now and long after crew camps are gone.
"We can't function as a tourist destination if there is no housing for tourists," he said. "It's nice that we have nearly 100 percent occupancy, but we absolutely need to be able to book rooms for conventions and tourists and we need to have room rates that are appealing."
Oltmanns said that the crew camp would also be taxed for the property it uses, which is estimated to generate $1.2 million annually if a 3,000-person crew camp is constructed, not to mention other taxes the workers would pay living in Dickinson.
"There is no hotel in North Dakota that pays that in property taxes, and the city made sure the camp would be taxed on an annual basis," he said. "Right now, hotels in the area can act like mini apartments and there certainly could be families living there that are not paying any property taxes. But these crews will be singles, no families. They won't affect the school system and the camps will be tied to our water and sewer and infrastructure so that we know we can support it.
"I would argue that the hotels are already unregulated, unsupervised man camps that are already rented by the oil industry. And shortly, Dickinson could get a reputation that it is only an oil-accommodating town because of lack of rooms if we don't have temporary housing for the workers and allow tourists to book hotel rooms."
Oltmanns said Dickinson could have a large number of temporary workers over the next three to 10 years.
"We need temporary housing for these workers, especially when you look at what has been done to skyrocketing rent and home prices," he said. "When these workers leave eventually, we'll see property values go down if we only build permanent housing now. If we build temporary housing for the current need, it will help to better manage the cost of living for everyone in the community."
Terri Thiel, executive director of the Dickinson Convention & Visitors Bureau, said motel and hotel managers have discussed the crew camps and possible impacts.
"There are oil workers already staying in hotels and motels here, and the hotel and motel owners have been appreciative of their business," she said. "The hotels know there needs be a balance of permanent and temporary housing, especially to relieve pressure on them during tourist times of the year, so I think business will still be good for the hotels.
"And in the long-term, we may have created a good opportunity to bring these workers back to visit attractions in the western part of the state, especially if the rooms they've been are welcoming to them. We want all of the hotels to make sure things are thought out and the industry continues to have good returns long-term, no boom or bust."