The Corpus Christi type B hires move marks a decisive step in the ongoing legal dispute surrounding the downtown Homewood Suites by Hilton development. On October 27, the Corpus Christi Type B board unanimously hired Hyde Kelley LLP for representation.
A Legal Dispute Over Taxpayer Incentives
In late 2023, the Type B board approved a $2 million incentive package for developers of the Homewood Suites project. The Corpus Christi City Council later endorsed this proposal to support downtown economic growth.
However, that same funding now lies at the center of a lawsuit alleging that developers misrepresented information from the FEMA to secure the money. The lawsuit lists the City of Corpus Christi as a defendant and Mayor Paulette Guajardo as defendants, intensifying public scrutiny over their handling of the incentive.
The controversy centers on whether the hotel developers, Elevate QOF LLC, properly disclosed FEMA’s updated flood zone requirements when applying for the funds.
Behind Closed Doors: One Hour of Deliberation
The Type B board spent over an hour in executive session reviewing the matter with legal staff before reconvening in public to cast its vote. Upon returning to open session, the board quickly hired Hyde Kelley LLP to safeguard legal interests.
Vice President Diana Summers confirmed the decision came after records requests linked to the ongoing lawsuit. She did not disclose who filed those requests. Still, she emphasized that the board acted to ensure compliance and transparency in legal matters.
How the Dispute Began
Developers applied for funding on September 27, 2023; by December, the Type B board approved it.
Developers claimed that the funding would help offset newly imposed construction costs due to FEMA’s updated flood maps. They also cited an economic impact report prepared by the Corpus Christi Regional Economic Development Corporation, which predicted the $30 million project would create local jobs and generate more than $1 million in city incentives.
Despite the projected benefits, another developer, Ajit David of RGB Hospitality, filed a lawsuit arguing that Elevate QOF LLC had misrepresented federal information to obtain public funds. This allegation has triggered a chain of investigations and heightened concerns about the city’s oversight of public incentive programs.
City Council and Audit Findings
The Corpus Christi City Council actively oversees and participates in the matter. In August 2024, Auditor George Holland reported findings suggesting possible fraud, abuse, or illegal activity occurred.
Following that assessment, Holland recommended hiring outside legal counsel to ensure an impartial investigation. Acting on his advice, the City Council voted in September to pursue an independent inquiry into the developers’ actions.
By October 7, the council had approved a request for staff to recruit an external attorney from a pre-approved list to examine the allegations surrounding the Type B funding.
What Comes Next
The hiring of Hyde Kelley LLP marks a new phase in the legal battle. The Austin firm will now represent the Type B Corporation as the case unfolds in court. Both the city and Type B board face public pressure to ensure transparency in taxpayer fund use.
Officials remain silent, but the case highlights rising concerns over accountability and trust in local development.
As investigations continue, Corpus Christi residents watch closely, seeking assurance of integrity and protection of public funds.