Bait and switch

Posted on May 31st, 2009 in News and Commentary

Bait and switch

Courtesy of LookingAtLancaster.com

We’ve all seen far too many instances of “bait and switch”, where we are enticed to look for something that is advertised, only to find that what is actually being offered is quite different. Unfortunately, the hotel and convention center project in downtown Lancaster, PA has been a prime example of “bait and switch” tactics.

For many months now, we’ve been hearing from many different sources about how this project would provide many good jobs for Lancaster residents. With cooperation from a number of different agencies, “Career Link” set up a training program for more than 800 people, with the promise that anyone who completes the course would be guaranteed an interview for a job in the hotel and convention center.

Widely advertised job fairs attracted about 1800 applicants. Yet out of the 150 or so front-line employees that have been made job offers so far, only 80 were hired from these two groups (according to Mark Moosic of Interstate Hotels and Resorts, joint manager of both the hotel and convention center). Where did the rest come from?

Out of well over 2000 applicants who responded to a variety of advertisements, including on web sites like craigslist.org. (Interestingly, not one “help wanted” advertisement for the hotel and convention center has appeared in any of the local newspapers.)

The “good” news is that out of the 150 individuals offered jobs so far, 90% will be full-time positions; 72% of these are Lancaster City residents. Additional people are expected to be hired by the end of 2009, bringing hotel and convention center staffing to about 250; 80% of this total should be full-time.

Another example of “bait and switch” is the total cost of the project. When the project was first proposed, it was expected to cost $75 million; the total cost now is estimated to be $177.6 million, not counting certain interest charges, and threatens to go even higher. The original cost to Lancaster taxpayers was estimated to be $15 million; now it is nearly $64 million, not counting lost real estate tax revenue. (It is worth noting that this project was originally supposed to create 300 to 400 jobs, many more than the 250 or so expected to result from a far more expensive facility.)

Lancaster City and School District of Lancaster taxpayers have been especially hard hit by yet another “bait and switch”: the Intelligencer Journal of August 21, 2001 quoted Nevin Cooley of High as promising the board of the School District of Lancaster that the hotel would generate as much as $400,000 a year in school real estate taxes; additional tax revenue would go to Lancaster City. The current project will pay no real estate taxes whatsoever for at least 20 years. Meanwhile, Lancaster City has forgiven the project hundreds of thousands of dollars in fees, while spending millions of dollars on improving the appearance of the area around the convention center in anticipation of its opening.

Much has been made of the “private-public partnership” behind this project. But how much of a “partnership” is it? For example, the LCCCA is using taxpayer dollars to pay for 100% of the cost of constructing and maintaining both ballrooms, as well as the main kitchen. One of these ballrooms will be controlled by the Penn Square Partners, which will receive all revenue generated from that space. And the hotel is expected to use the kitchen at least 75% of the time. For this and other considerations, the PSP will pay $100 a year, with a 99 year lease. Now that is some partnership.

How are we supposed to react to all of this? Judging by statements made by numerous public officials and civic leaders, as well as articles and editorials in the local newspapers, we are supposed to be very happy about the hotel and convention center project! It is what it is, we have been told; we must not focus on the past, but instead look forward to the future.
We are supposed to focus on the jobs and economic development that might be created by the hotel and convention center project, and just forget about the “bait and switch” agreements which will be so costly to local taxpayers for generations to come.

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