The Corpus Christi B Corporation voted Monday to terminate its 2024 Business Incentive Agreement with Elevate QOF, LLC, replacing it with a new settlement agreement. The board described it as an effort to conclude protracted lit igation over the downtown Homewood Suites hotel project.Hotelier Ajit David sued the City of Corpus Christi in September 2024, seeking to invalidate the economic development agreement that awarded $2 million in Type B sales tax funds to Elevate QOF for the construction of the 126-room Homewood Suites by Hilton at the corner of North Chaparral Street and Lomax Street.City Manager Peter Zanoni, in a written statement to KRIS 6 News, said city staff were not involved in the agreement."City staff and City attorneys learned of this settlement agreement this morning at the Type B Board Meeting. We were not involved in its development or execution. At this time, we are meeting with our City Attorney to determine the agreement's legality and if it needs City Council consideration. At the same time, we have instructed our Finance Director to not make any wire transfers," Zanoni wrote.In a statement released after the vote, Board President Diana Summers said the board approved a Termination, Settlement and Release Agreement "in order to support the City Council's decision to move forward with mediating the dispute and encourage the parties in litigation to resolve their conflict without further litigation and expense incurred by the Corpus Christi taxpayers."The agreement eliminates $500,000 or 25% of the original $2 million incentive, according to both the board's statement and the TSRA obtained by KRIS 6 News. Under the agreement, the B Corporation will pay Elevate QOF $1.5 million within three business days of execution, drawing from the same Type B sales tax fund that backed the original deal.The remaining $500,000 will be reserved to reimburse the city's direct legal costs in defending the David lawsuit up to $300,000 and to indemnify and defend the B Corporation and any board member who served at any time from when the board first considered the original incentive agreement through the execution of the new agreement, according to the agreement.It also requires Elevate QOF to provide a sworn affidavit confirming at least $2 million in qualifying expenditures on the hotel property, along with copies of invoices and proof of payment, according to the TSRA.In a separate funding letter dated August 10, 2026, Summers directed the city's Director of Finance and Procurement, Sergio Villasana Jr., to wire the $1.5 million to a trust account at American Bank. The letter stated the board directed the payment be made "with all due haste," calling the matter time-sensitive because mediation in the David lawsuit was scheduled to begin the same day.The board's statement said the action followed a July 14, 2026, Corpus Christi City Council vote to "direct city staff to pursue mediation with 'all parties concerned' or at the very least, the lawsuit of Ajit David vs. City of Corpus Christi." That vote passed 5-3-1, with Council Members Vaughn, Hernandez, Campos, Paxson and Cantu in favor; Council Member Barrera, Mayor Guajardo and Council Member Scott opposed; and Council Member Roy abstaining."Despite not receiving an express invitation to participate in the ongoing mediation, representatives of the Board of Directors proactively explored whether, as an interested stakeholder, they could help facilitate a resolution that would support a conclusion in a manner consistent with the direction adopted by the City Council when it voted to proceed with mediation," the board's statement said."We remain hopeful that by bringing this chapter to a close for the Type B Corporation, this will support the ongoing efforts of the parties in litigation to reach a resolution that will bring this matter to conclusion," Summers said in the statement. "It is our sincere hope that doing so will allow all involved to move forward in the best interests of the citizens of Corpus Christi and restore the community's full attention to the priorities and issues that matter most to the residents of our beloved city."For the latest local news updates, click here, or download the KRIS 6 News App. Catch all the KRIS 6 News stories and more on our YouTube page. Subscribe today! ...read more read less