Case against Hammons' Osage Beach project moves to federal court

A court case challenging John Q. Hammons' Chateau on the Lake of the Ozarks project has been moved to federal court, the Lake Sun Leader reports.

Four Seasons Marina Rentals Inc. originally filed the lawsuit in Camden County against Springfield-based Hammons Hotels, after the city of Osage Beach in late 2007 approved Hammons' request for a $3.7 million tax increment financing district for the project. The suit questions the property's blight designation, which is required by state law in order to use a TIF for redevelopment.

Hammons Hotels' initial redevelopment plan argued the land is blighted and could be improved by the hotel, which officials at the time said could generate about $25 million in annual revenues. That could result in an estimated $500,000 in annual sales tax revenue for the city.

The case has been moved to federal court because attorneys for Four Seasons cited federal law, according to the report. Four Seasons filed a motion to return the case to state court, but it was denied. Federal Judge Nanette Kay Laughrey has set the case for trial on June 1 in Jefferson City.

The nearly $100 million project on the lake's east side calls for a 15-story, 320-room hotel with a spa and meeting space. Plans are to have the resort under construction this summer and completed by spring 2011, the paper reports.