Lancaster First
Lancaster, Pennsylvania

Lancaster First Policy Statement

Why We Will NEVER Support the Hotel and Convention Center Project

January 1, 2007

It has been said that it is time for compromise between supporters and opponents of the proposed hotel and convention center project.

It has been said that it is time to put aside our differences, and work together to support the project, to minimize the risk to local taxpayers.

We do not agree.

The actions of two mayors of Lancaster City, Lancaster City Council, previous Lancaster County Commissioners, and the unelected board of the Lancaster County Convention Center Authority, have intentionally slammed the door on "compromise". Their actions combined have committed to this project at least $160 million taxpayer dollars and guarantees plus interest over 40 years, out of an estimated $170+ million cost.

The lure of "easy money" has seduced local business, political, and civic leaders into pursuing an increasingly risky gamble. Yet not a single one of these individuals can look someone in the eye and explain with verifiable facts and figures why this outrageously expensive project is such a good investment of taxpayer dollars.

A few - but not all - of our concerns are:

  • There has been no accountability of any kind to local taxpayers. Millions of dollars have already been spent without adequate explanation. Particularly troublesome have been the exorbitant sums spent on legal fees and consultants without detailed invoices. Most of the repeated "Freedom of Information" and "Right to Know" requests have been ignored or refused. Even members of the LCCCA board are kept in the dark until the day before they are expected to vote on the expenditure of even more taxpayer dollars, and many other expenditures have never been explained to them at all.

  • The original project was widely publicized as the best way to save the historic Watt & Shand building, which was added to the National Register of Historic Places. Today, all that remains of the Watt & Shand buildings are ruins.

  • The original project was widely publicized as a "private-public partnership". Today, only 6.45% of the up-front cash investment is expected to be private funding, or $11 million of the currently anticipated $170.5 million. The claim of an additional "private" investment is to come from future profits to be earned from the taxpayer-owned and financed hotel.

  • The original project was widely publicized as a way to provide additional tax revenue for the cash-strapped School District of Lancaster. Today, the City of Lancaster has taken legal ownership of the Watt & Shand site in an attempt by the Penn Square Partners to avoid paying taxes at all on their "private" hotel building for at least 20 years. Meanwhile, the leaders of Lancaster City have waived hundreds of thousands of dollars in badly-needed fees that should have been collected from this project.

  • No substantial justification for the project has ever been presented to the public. The LCCCA has repeatedly pointed to a marketing report of the original $75 million incarnation of the project from the year 2000 (which has since been discredited by its authors); in fact, the LCCCA and Penn Square Partners web sites still misquote figures from this report. However, in 2003 the project was redesigned "to reduce construction budget costs both for LCCCA and PSP", according to the Penn Square Partners' web site; this resulted in a much larger and far more expensive project than was originally presented to the public. In spite of this, the LCCCA has never presented to the public facts and figures that would show how this vastly expanded project can make any kind of economic sense. Even today, the LCCCA refuses to explain how they arrived at the figures they are currently using to anticipate cash flow and operational losses.

  • State laws have been repeatedly rewritten to support this specific project, without any concern for the long-term consequences. These include substantial cutbacks of prevailing wage laws, the infamous Act 23 (which provides State grants based on anticipated tax collections), and the ability of local governments to force taxpayers to pay all real estate taxes on projects specifically designed to benefit private business.

  • On multiple occasions, the Penn Square Partners have threatened to kill the project unless their demands were met. In each case, the LCCCA caved in. This is not negotiating, this is coercion and intimidation.

  • Multiple lawsuits have been brought against the project by various parties, all concerning various aspects of the project financing. The LCCCA publicly claims victory in court over all of these, but in most of these cases what really happened is the LCCCA threatened to draw out legal actions using taxpayer dollars until the private parties were driven into bankruptcy. This is not legal victory, this is coercion and intimidation.

  • The local media - whose owners stand to reap 44% of the profit from the proposed taxpayer-owned and financed hotel - has consistently attacked those who dare raise questions about this project, while basically ignoring their concerns. This is not reporting, this is coercion and intimidation.

    Compromise means all parties involved in an issue must be willing to give up something. Yet all the calls for "compromise" from the people behind this project include no concessions on their part. This is not compromise, this is coercion.

    Public support for any expenditure of taxpayer dollars requires openness, honesty, accountability, and public involvement. This project has never involved any of these. The result of this has been, and always will be, division and discontent. No matter what happens from this day forward, this project will remain a source of shame for generations to come.

    August 5, 2006

    The time has come to move beyond the mistakes of the past. We need a positive vision for the future of Lancaster that brings everyone together.

    The time has come to begin healing the deep divisions caused by the proposed hotel and convention center. These divisions will continue to grow deeper as long as the current project is still being considered.

    The time has come for those who promote this project to admit defeat - or declare victory, if it makes them feel better - and move on to a project that actually makes sense for Lancaster and its people.

    The financing proposed for this project is as fragile as a house of cards. This project has been declared dead, then revived, so many times as to defy reason. Maintaining the project on life support only serves to delay the inevitable. The justification given for proceeding with a project of this magnitude is even more flimsy.

    The public has been consistently disenfranchised in the creation and evolution of this project. Not only was this proposal presented to the public as a done deal, the size and cost of the project has escalated beyond all reason while thick veils of secrecy were wrapped around the decision making process. Those promoting this project have consistently failed to respond to direct questions by the public, at times attacking those asking the questions. Indeed, the opposition to this project has in large part been created by the actions of the very groups who are promoting this project.

    This project is a splinter which has become infected in the lion's paw of the public. Healing cannot begin until the splinter is removed. It is critical that the people in positions of leadership pull the plug on this project ASAP.

    Those in positions of leadership must recognize the mistakes and failures that have been made, and be willing to address these issues as Lancaster moves into the future. Project supporters must acknowledge the divisiveness caused by their obstinance and intransigence. The people will give them a break if they recognize that they are a part of the problem. They need to reach out to the people they have offended and disenfranchised - the so-called "naysayers".

    Lancaster County has nearly 1/2 million people; decisions can no longer be made by a few well-connected individuals. Grass roots support is absolutely necessary for any public project. Grass roots supporters are NOT employees or associates of these well-connected individuals, but instead people who really care about what happens to their home town.

    Lancaster needs a POSITIVE VISION for the future that brings everyone together. Lancaster needs a project that makes economic sense for its residents, as well as for business interests. Economic development and sustainable growth requires constructive input and public involvement. Any public economic development project without public support will result in the public spending their money elsewhere. Only by creating a sense of involvement by the people can a project ultimately serve the people.

    The time has come for the leaders of Lancaster City and County to move beyond the mistakes of the past, and demonstrate real leadership. The time has come to move constructively and cooperatively into a better future for all the people of Lancaster.

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    updated January 27, 2007 at 2:00 PM

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