KINGSTON — Although business isn't what it used to be, the occasional tourist still drops by Dolores Pitt's curio shop at Main Street and U.S. Highway 70 to ask what happened to Lake Texoma State Lodge.
These days, the only guests on the grassy spot where the lodge once stood overlooking the Roosevelt Memorial Bridge on Lake Texoma are the Texas-size mosquitoes.
“It feels like we've been ripped off,” Pitt said, who owns D's Creative Corner in Kingston.
Like many area residents, Pitt is angry that the private developers who promised the state to build a four-star hotel in the area to replace the lodge have yet to move forward on the project.
Four miles east of Kingston, the hands of a clock at the Lake Texomaland Fun Park are frozen at 6:30 and weeds and grass have overtaken the go-cart track as well as a nearby riding stable.
Although a sign at the abandoned amusement park, proclaims it's “time for fun,” the park, which once contained bumper boats and a video game arcade, has been closed for several years. Like much of the surrounding land, the riding stable and amusement park are owned by Oklahoma City-based Pointe Vista Development.
Marshall County residents still are waiting for a luxury hotel to be built on the site seven years after Pointe Vista inked a deal with the state to purchase the lodge and 750 acres of parkland for $14.6 million. The development group is owned by Chaparral Energy CEO Mark Fischer and former Chesapeake Energy CEO Aubrey McClendon.
Tension between residents and business owners on the banks of Lake Texoma and Pointe Vista is growing as a deadline looms for the developer to build the hotel.
Tourist traffic in this Marshall County town of about 1,000 residents has slowed somewhat since the lodge and a clutch of lakeside cabins at the park shut down in late 2006. Pitt estimates her business has dropped off by about two-thirds since the lodge and cabins closed.
“We're paying the bills, but that's about all we're doing,” Pitt said. “I'm not making any money.”
Through a spokesman, Pointe Vista said it shares the residents' frustration with a lack of progress on the development. Pointe Vista spokesman Brent Gooden gave The Oklahoman an eight-page written response to a reporter's questions about the project.
“We understand and respect their frustration. In fact, like many in the area, we wish we were underway with the project,” Gooden said. “Even though the market over the past few years has not been favorable toward hospitality and hotel development, given the improving economic outlook, we believe and upscale resort is doable.”
As with the residents of Kingston, Pointe Vista's relationship with state officials also has become strained.
After meeting in closed session at its June meeting, the Oklahoma Commissioners of the Land Office voted to spend up to $250,000 to hire outside legal representation to represent the state in the Pointe Vista matter.
“At this point in time we just feel like it's important to have outside legal counsel to advise us on what options will be on the table for the land commission and the interest of the state,” Gov. Mary Fallin said after the meeting.
Fallin was an early supporter of the Pointe Vista development. In 2007, during her tenure in the U.S. House of Representatives, Fallin and Rep. Tom Cole, R-Moore teamed up to sponsor a bill to transfer 227 acres of shoreline at Lake Texoma from the U.S. Army Corps of Engineers to Oklahoma. The transfer would allow the state to sell the land to Pointe Vista and pave the way private development.
At the time, Fallin touted the legislation as “one of the last pieces of the puzzle” to bring millions of dollars of new private investment to Lake Texoma, creating new jobs in the area.
Six years later, Pointe Vista has yet to break ground on the development. The state has the right to sue Pointe Vista if the hotel is not substantially completed by May 2014.
Over the past 18 months, Fallin has met with Pointe Vista to attempt to encourage the developers to move the project along. At her direction, the Commissioners of the Land Office sent a pointed letter to Pointe Vista in February asking for a specific timeline for the project and other information.
In its response — sent seven weeks later — Pointe Vista blamed the economic downturn of 2008 for drying up financing for the project and said it would likely ask for an extension to hold up its end of the development contract with the state.
“In the aftermath of the financial crisis, it became virtually impossible to obtain equity investors and financing for the Pointe Vista project,” Pointe Vista CEO Mark Fischer and son, Scott Fischer, the developer's chief operating officer, said in the letter. “In addition, during the past few years, one of our lead investors has faced significant business and financial challenges.”
Harry Birdwell, secretary for the Commissioners of the Land Office, said the commission has grown more concerned about the future of the project as time has passed without a groundbreaking. Pointe Vista's response to the commission's letter did little reassure him.
“I still don't think they answered my questions,” he said.
Without a firm development plan in place, Birdwell said he would not recommend that the land commission give Pointe Vista an extension on its contract.
“We have tried to suggest alternatives to get them moving — the governor has introduced people she has met all over the country,” Birdwell said. “We've done all we can to help them find resources.”
Push for privatization
Before the state moved to sell the Lake Texoma parkland, lodge and cabins to Pointe Vista, the facilities were beginning to show their age and funding for needed upgrades was scarce.
The Oklahoma Tourism and Recreation Department estimates that it needed $20 million to $40 million to make repairs at Lake Texoma. Occupancy was down at the park and the state had operated the Lodge and cabins for several years at a loss before Pointe Vista acquired the property.
In 2005, the Oklahoma state park system faced a $90 million backlog of maintenance needs. Faced with a lack of state funding, the state moved to privatize a portion of the park.
Pointe Vista's plans to develop a $750 million to $1 billion resort-like development on the shores of Lake Texoma were initially met with enthusiasm from the locals, said Mark Codner, publisher of the Madill Record newspaper.
“At the time, we thought privatization would do things for the local economy that the state couldn't — we thought it was the way to go,” Codner said.
Although construction has yet to begin, Pointe Vista estimates that it has already invested about $45 million into the development.
The developer has spent most of that money on additional real estate in the area — about $21.5 million. That includes purchasing a marina at Catfish Bay and the nearby Chickasaw Pointe Golf Course. Pointe Vista has sunk more money into upgrades and renovations at the golf course and marina.
The developer said it also has spent millions on architectural, engineering and planning professional services.
The Pointe Vista site also lacks necessary infrastructure, Gooden said. Plans to tie into the city of Kingston's wastewater system had to be scrapped, because the city can't afford to expand its facilities.
The money that Pointe Vista has tied up in the area does not matter to Lisa Davis, one of the organizers of the group Restore Lake Texoma State Park. The group says it does not want the state to grant Pointe Vista any extensions to build the development.
“These are bad business decisions that the state made. These are bad business decisions that Pointe Vista made,” Davis said. “We should not be made to pay for their bad business decisions.”
Up in the air
In 2008, Pointe Vista negotiated to purchase an additional 1,022 acres of parkland at Lake Texoma that includes a campground at Catfish Bay. The parkland, owned by the U.S. Army Corps of Engineers, would be transferred to the Tourism Department, and then sold to Pointe Vista.
“When we talked to the developer, they felt like they needed the whole area to do the project justice,” said Claudia Conner, general counsel for the Tourism Department.
Although the land remains under contract to Pointe Vista, an environmental-impact statement required by the federal government to complete the sale has never been finalized. Pointe Vista has yet to pay for the environmental study.
“The developer already put a deposit down with the Corps of Engineers for $300,000, but that was some years ago,” Conner said.
The federal government determined that the environmental review would cost more than $2.5 million, a price Pointe Vista has indicated to be too high, according to the letter it sent to the state in April. The developer is trying negotiate a reduction of the cost of the review and is willing to pay up to $1.2 million to fund the environmental study, it said in written comments to The Oklahoman.
While the Bar-B-Q Shack still serves up smoked brisket from a metal building on Kingston's main drag, business has slowed since the state lodge closed in 2006, owner Donna Bearden said.
The lodge and cabins along the shore of Lake Texoma once brought a steady stream of traffic to Bearden's business, but most of her customers these days are locals, she said.
“It's not what it used to be,” Bearden said. “When they announced this development, I thought we were going to be the next Branson, I really did.”
Bearden has since put up the Bar-B-Q shack up for sale. “Will sacrifice for $135,000”, she wrote in one classified ad for the business.
At 6.3 percent, unemployment was higher in Marshall County in April than the statewide 4.9 percent, according to the most recent data available. Algae outbreaks at Lake Texoma in 2011 and 2012 also saw tourism to the area decline as much as 20 percent, as Gooden is quick to point out.
Sales tax revenues in Marshall County plunged from $3.5 million in the 2005 fiscal year, before the lodge closed, to $1.6 million in 2006, but rebounded to $3.5 million for 2012, according to Oklahoma Tax Commission records.
Rightly or wrongly, a perception in the area exists that Pointe Vista has starved out many local businesses.
The Marshall County Chamber of Commerce has sent out news releases and engaged in other marketing since the lodge shut down to combat the perception that the park is closed. A campground at Catfish Bay is part of the 1,022 acres of Lake Texoma parkland under contract to Pointe Vista Development, but it remains open.
“People think that since the lodge is shut down that there is nothing to do down here — they have the perception that the whole park is closed,” said Vicki Byrd, chairwoman of the economic development committee of the Marshall County Chamber of Commerce.
The economic development committee recently sent a letter to the Commissioners of the Land Office urging them to stand firm to the project deadlines and force Pointe Vista to begin work on the hotel.
Codner, who also is a member of chamber's economic development committee, said that the developer has been engaged in the community, even donating money to local schools.
“With the exception of not building the hotel, they have been a really good corporate neighbor,” Codner said. However, the lack of movement on the development has meant lost tourism dollars and investment from other business in the area, he said.
“We have had people who have lost their businesses because of it — and other businesses that would have come to the area, but have not because of this,” Codner said.
Over chips and salsa at the Gecko Grill, a sleepy Tex-Mex restaurant off Highway 70 in Kingston, Stephen Willis, an organizer for the Restore Lake Texoma State Park group, along with Davis and Bearden discuss filing a civil-rights complaint with the U.S. Justice Department over how the Pointe Vista development process has been handled by the state.
“They handed this contract to two wealthy white men in Oklahoma City,” Willis said. “Low-income people in the area couldn't even afford a room at that four-star hotel.”
The local population, women, minorities and local Indian tribes were left out of the bidding process to purchase the land, Davis said.
“I will not be relegated to cleaning the toilets for some place where I used to be able to go in through the front door of that lodge,” Davis said.
The community is divided on what should happen to Pointe Vista. Some, like Pitt, would like to see the land returned to the state. Restore Lake Texoma State Park, which claims to have about 300 members, last week issued a letter to state officials calling the sales of park land a violation of federal law and demanded that the Pointe Vista land turned back into a state park.
Codner remains hopeful the development will move forward.
“I think that their intention is to put this project together,” he said. “I would love to see it built tomorrow. Everyone has tried to work on it, but for various reasons, it just hasn't happened yet.”
Byrd also said she still believes that the Pointe Vista land on Lake Texoma would still be world-class location for a four-star hotel that would draw visitors from around the region.
Pointe Vista said that it is hopeful that financing for the project may finally materialize as the hospitality industry improves.
Truncating the development and building a scaled-down version of the hotel would not be competitive with nearby casino hotels built by area Indian tribes, Gooden said.
“We do not intend to compromise on the quality of the original idea,” Gooden said.
“Our most recent economic data indicate the region can support a quality resort development, when properly timed, geared around the natural amenities offered at Lake Texoma, and based on the concepts we presented in our original design five years ago.”
CONTRIBUTING: Michael McNutt, Capitol Bureau