(Twenty-sixth in a series)

By Christiaan A. Hart-Nibbrig

The $15 million grant from the Commonwealth, and the revenue from the hotel room tax, provided the LCCCA with millions of dollars to defend the project in court, and to acquire property for the proposed development.

After buying the Oblender furniture store and properties at 45-49 S. Queen Street and 21 and 23 E. Vine Street for about $1.3 million, the Authority found itself presented with another public relations predicament.

The poorly maintained, but structurally sound, buildings at Vine and Queen Streets were not every day buildings. They happened to be the former home and business of one of the greatest Americans in the country’s history—Thaddeus Stevens.

Stevens, a severe-looking, bald (due to disease), club-footed, republican Congressman during the Civil War and Reconstruction Era, was the moving force behind of the 13^th, 14^th, and 15^th Amendments to the United States Constitution. Those amendments—emancipating African-Americans, giving African-Americans citizenship, and providing African-Americans with the right to vote—are as historically consequential as any in the nation’s history.

Thaddeus Stevens is also credited with establishing widespread free public education in Pennsylvania. For decades, he ran a successful law practice in Lancaster from the Queen and Vine Street location. Arguably, Stevens is the most impactful American to call Lancaster home, far more consequential than the feckless James Buchanan, the country’s 15^th President, whose former residence (Wheatland) just west of the city has been lovingly restored.

Another of the buildings acquired by the authority belonged to Stevens’ longtime confidante, the mixed-race Lydia Hamilton Smith who, apart from being a pioneering black businesswoman, was also said by historians to have been a ‘conductor’ on Harriet Tubman’s Underground Railroad network, helping fugitive slaves escape the slave holding South.

The issue confronting the convention center authority was that the location, where the great American Stevens made his home and business, was directly in the way of where they wanted to build their convention center.

Randolph Harris was the Executive Director of the Historic Preservation Trust during these years. Harris, a conscientious historian, was acutely aware of Stevens’ historical significance. Harris was also cognizant that the Trust owned easements on those properties, requiring the Trust’s approval for any alteration done to the buildings. In 1983, the easements had been signed over to the Trust by the last owners of the buildings.

In December, 1999, soon after the LCCCA board was formed, Harris wrote a letter to Pickard advising him of this fact. Pickard did not respond, and by June, 2000, all of the properties were purchased by the Authority.

In early January, 2001, the Trust announced a proposal to create a ‘Thaddeus Stevens and Lydia Hamilton Smith National Historic Landmark’ on the properties. The Trust recommended that the LCCCA restore all of the buildings and create a museum around the Stevens/Hamilton theme.

In February, 2001, Pickard announced the authority would preserve the building facades. Those facades, at the very least, will have to be incorporated into the architecture of the convention center building,” he was quoted in the Lancaster Newspapers. “Overall, the aesthetics will fit in. Even though it’s going to be a new building, we want it to reflect the heritage of Lancaster.”

Pickard clearly bristled at having to address the Stevens property issue. He stated the authority was unaware of the easements when it purchased the buildings in March, 2000. Pickard blamed the company overseeing the sale, Commonwealth National Title Insurance Co., for not making the authority aware of the easements. The authority originally planned to raze the buildings, until Harris objected, citing the easements.

The authority and Trust explored the possibility of integrating the historic buildings into the convention center design. But center planners objected, concerned that it would reduce the size, and jeopardize the viability of the project.

In April 2001, after negotiating with the Redevelopment Authority of the City of Lancaster (RACL), the Convention Center Authority board voted unanimously to invoke eminent domain and relocate, as in physically transport, three of the historical buildings across the street to a vacant parking lot behind the Swan Hotel. Most historians, including Harris and Robert C. Wilburn, president and chief executive officer of the Gettysburg National Battlefield Museum, thought the idea was a bad one.

“For one public body to be making a decision with another public body in a vacuum, without consulting with people who know about historic preservation law, is not wise,” Harris fumed after the meeting to move the buildings.

“This was scripted, orchestrated, ad infinitum,” Harris continued, “(Authority members) wanted to make the perception we were all engaged in this discussion. But it’s a smokescreen. It’s bogus.”

Even staunch project proponent State Sen. Gibson Armstrong objected to moving the buildings. Armstrong, whose wife sat on the board of directors of the Historic Preservation Trust, publicly questioned moving the buildings. “We don’t need any more lawsuits and we don’t need any more problems,” he said to the New Era.

The rhetoric and public relations campaigning on both sides of the historical building issue got heated.

In May, 2001, Pickard sharply criticized a mayor from South Carolina who publicly spoke about preserving the buildings where they were. Pickard blamed the Trust for “lobbying” for its side.

The issue was effectively resolved on May 22, 2001, when the RACL board voted unanimously to nullify the Stevens/Smith easements held by the Trust. The Intelligencer Journal reported “Nullifying the easements on the historic properties is valid, as long as the convention center authority buys the Swan Hotel, said Thomas Weber, chairman of the redevelopment authority.“

The Authority now could do what it pleased with the properties, and it did.

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Chapter Twenty-Seven: Uncommon management: PSP flexes muscle

(Twenty-fifth in a series)

by Christiaan A. Hart-Nibbrig

The bitter acrimony among the Lancaster citizenry that would mark the next decade of the convention center’s history began to show itself by the year 2000.

Dozens of Lancaster County hotel and motel owners—who now paid a 5% tax for every room rented—filed a joint lawsuit against the project sponsors in March.

Ron Harper, Jr., with his video camera, website, and indefatigable energy, was unleashed and asking uncomfortable questions to proponents of the project wherever he found them.

Downtown store owners, like the respected Rick Atwater, whose family owned and ran Oblender’s Furniture for a century, were left sour after feeling forced to sell out on the cheap.

At regularly scheduled Lancaster County Convention Center Authority (LCCCA) meetings, questions from the public went unanswered. A pie was thrown; insults hurled.

Nearly an entire city block of historic buildings were targeted for demolition.

But the project, stewarded by James O. Pickard, Chairman of the seven-member LCCCA board of directors, proceeded apace.

Jim Pickard ran LCCCA meetings with an imperious hand and an iron gavel. A former republican Pennsylvania Secretary of Commerce (Thornburgh administration, 1983-87), Pickard was also Lancaster Mayor Charlie Smithgall’s handpicked Economic Development Director. From that position, Pickard was a key player in the 1998 purchase of the historic Watt & Shand building by Penn Square Partners.

Pickard, owner of a successful, international, niche saw and knife export business, was a client of Stevens & Lee LLC,, the Reading-based law firm that authored the Convention Center Act of 1994. Stevens & Lee was also the solicitor for the LCCCA and the County, and High Industries’ registered lobbyist in Harrisburg.

The LCCCA business offices were located within the Lancaster branch of Stevens & Lee, on the second floor of the Fulton Bank building on Penn Square, across the street from the proposed facility. The other Penn Square Partner, Lancaster Newspapers, occupied another corner of the Square.

During 2000 and part of 2001, nominally “public” meetings were held in both the County Commissioners’ meeting room, and the tiny Commissioners conference room, where there were, at times, no seats available to the public. By mid-2001, the meetings moved to the City Council Chambers at the cavernous Southern Market Center on Vine Street.

Meeting attendees usually included only board members, whose attendance was often sporadic, and a scant few members of the public. Harper was one of the few citizens regularly present, as were a few hotel and motel owners, such as Rodney Gleiberman of the Continental Inn and Peter Chiccarine, of the Best Western Eden Resort.

As chairman, Pickard displayed a penchant for removing the audience from a meeting mid-stream, while he held executive sessions with only board members and the solicitor – Stevens & Lee partner, and County Attorney, John Espenshade – present. These ‘executive session’ actions caused the attendees and reporters to stand out in the hallway for extended periods until Pickard re-convened the public part of the meeting. (This was a practice later used often by Ted Darcus, a successor to Pickard as LCCCA chair.)

The meetings themselves were often testy and oddly rude exchanges for a community with a reputation for civil comity. If a hotelier made a public comment during a meeting, and they were often the only members of the public there, Pickard would announce, before the speaker said anything that the speaker was a litigant against the Authority.

Sometimes the histrionics devolved into farce. At one meeting in early May, 2001, Harper presented Pickard with a chocolate cream pie—“humble pie,” Harper called it. With mock deference, Harper placed the pie in front of Pickard, who sat in his center seat on the raised dais. In a rage, Pickard roughly grabbed the pie and threw it back toward Harper. He missed, but the entire act was recorded by the local television news cameras and played for the folks at home. Pickard looked unhinged. The small crowd was stunned.

“You’ll get no apology from this chair,” Pickard snarled at Harper. Pickard was criticized by the Lancaster Newspapers, and later apologized for his actions (but not to Harper) at the next meeting.

The other six members of the LCCCA board of directors were a relatively unknown mix of business executives, lawyers, and working stiffs, none of whom, save one, had any experience with conventions or trade shows.

The original members appointed by the County were: Pickard; Garth Sprecher, a communications executive; Camilla Collova, a retired corporate executive; Paul Wright, retired general manager of a large retail store. The city appointees to the LCCCA board were: Willie Borden Jr., a journeyman electrician, Bradley Clark, vice president of a commercial realty firm; and Christina Hausner, an attorney.

Clark was the only member to have any experience with trade shows, or event planning and promotion, and it was not extensive.

The hotelier litigation provided Pickard the justification to prevent the board from answering questions from the public during LCCCA meetings. But the policy proved to be public relations problem and eventually forced Pickard to address it publicly.

Pickard wrote a public “clarification” published in the Lancaster Newspapers:

“We wish to clarify what the public comment section of the agenda is for — and will add this above point of clarification to all of our agendas. We also wish to clarify what the “public comment’ portion of the agenda is NOT: It is not a question and answer session. It is not an opportunity for plaintiffs or defendants in a lawsuit to conduct discovery. The Authority has complied with all the requirements of Sunshine Act and welcomes public input and comment during our meetings. It is not the intention of the Authority to avoid being responsive to legitimate questions, but the lawsuit filed by the hoteliers has had a chilling effect on our ability to respond. We have been advised by our legal counsel that it is inappropriate to respond to questions or comments from the public that impact the pending litigation. …” [capitalization in original]

In a rarely critical comment against the LCCCA, a Sunday News editorial (“Misguided Policy, The Convention Center Autority Overreacts To Requests For Information About The Project”) suggested the authority board open itself up to questions from the public.

The external pressure didn’t faze Pickard, who refused to answer questions, from anyone, regarding the authority’s finances, including the status of the authority’s budget or its building plans.

In a letter to the Lancaster New Era, Mark Clossey, General Manager of the Lancaster Host Resort and Hotel, and a litigant against the Authority, wrote:

“When you cannot ask questions at a public meeting, and are silenced for asking for more information, it reflects how wrong the project truly is. I have never been allowed to enter the arena since a few politicians and bureaucrats said the hotel and convention center is going to be built. I guess that means at any expense. This type of process defeats such projects, not a lawsuit.”

At a later LCCCA board meeting, after Clossey asked a question during the public comment portion, Pickard glared at Clossey, “I’m not obliged to answer any of your questions,” He then added: “The question you just asked falls in the classification of not being responded to.”

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Chapter Twenty-Six: 2000-2001 Part III: Convention Center Authority doesn’t let history stand in the way

(Twenty-third in a series)

“We [the opposition's leading figures] were all working independently and were not even necessarily congenial with one another. There were no gatherings to discuss what we should do, no lawyers or public relations consultants to guide us, no word coming down from the top…”

– Convention center critic and Newslanc publisher, Robert Field, on other opponents of the convention center project.

After PKF was chosen in mid-February 2006, many critics of the Convention Center project turned their attention to the payments made by the Convention Center Authority to the law firm at the center of virtually every aspect of this project: Stevens & Lee.

By 2006, Stevens & Lee had billed (and been paid by) the LCCCA more than six million dollars. Every single one of the more than 200 invoices was devoid of itemized detail with respect to the work performed. Each invoice simply read:

“For professional services rendered on behalf of the Lancaster County Convention Center Authority.”

In December of 2005, Robert Field launched Newslanc.com. On the website, which was updated daily, Field wrote a “Watch Dog” column, in which he would discuss and often praise or criticize local items published in the Lancaster newspapers, with particular attention given to the convention center issue.

NewsLanc newsletters were also handed out at the popular Lancaster Central Market, the minor league Lancaster Barnstormers’ baseball games, and other county events that attracted large crowds. (Field often joined in handing out the fliers, something he occasionally does today.)

Field, drawing from years as a political activist, often ran lively, often pointed, radio spots for NewsLanc at popular Lancaster stations.

Through the Pennsylvania Right to Know law, NewsLanc obtained the invoices for the Stevens & Lee LCCCA billings. There were 228 invoices ranging in amounts from less than one hundred dollars to more than $100,000.

Field analyzed the invoices and concluded that Stevens & Lee would have had to have multiple personnel working full-time on the project to come up with the amounts being charged, which he believed was inconceivable.

To Field, in the early months of 2006, the seemingly cavalier withholding of normal billing procedures was a red flag, and he was determined to get the itemized invoices released. “I took the bait,” he said a few years later.

Joining Field in aggressively questioning the Stevens & Lee invoices were the three new county-appointed members of the LCCCA board of directors.

Laura Douglas, Deb Hall, and Jack Craver – three strong, independent personalities — had already revealed their disenchantment with the project by the time they began asking about the attorneys’ fees.

In early January, 2006, only months after being appointed to the board, the three convened a large public meeting to air out questions about the project. More than 200 people attended the meeting. This was the infamous meeting attended by newly-elected Mayor Rick Gray.

Now, Douglas, Hall, and Craver were asking about the invoices at LCCCA board meetings.

“The issue with the Stevens & Lee bills for me was that it seemed like a lot of money was being paid for this work,” said Douglas after she left the board. “I wanted a ’spot forensic’ to see if the work we were being charged took that amount of time. But we couldn’t get any answers from Ted.”

‘Ted,’ of course, was Ted Darcus, the imperious chairman of the LCCCA board, who consistently and often rudely denied the public and even board members access to itemized invoices, saying they contained confidential information and would not be available as long as there was ongoing litigation.

In June of 2006, another county LCCCA appointee, Deb Hall, whose day job was then president of the Ephrata Chamber of Commerce, and who was a former paralegal, introduced a resolution to hire an independent legal auditor to review the Stevens & Lee bills. The proposal was voted down by the city-majority of the LCCCA board.

It seemed the entire opposition to the project was focused on the Stevens & Lee invoices. Former Lancaster city councilman, Luis Mendoza, wrote (with Field’s assistance) multiple letters to the editor and appeared at LCCCA board meetings demanding the full release of the invoices.

The always entertaining Ron Harper, Jr., in his inimitable fashion, also demanded the bills’ release. Harper appeared at LCCCA meetings with a large cardboard cutout of Authority solicitor (and Stevens & Lee partner) John Espenshade. Harper would make his remarks with his arm around “Flat John,” as he asked the non-responsive Espenshade about the bills during the public comment portion of the meetings. This never failed to garner laughs, even from Darcus and other project supporters.

Craver, the former general manager of New York’s Plaza Hotel, had written a published letter to the editor to one of the Lancaster Newspapers in which he criticizes the project’s lack of a feasibility study, financing, and the administration of the LCCCA board under Darcus, including the refusal to allow the Stevens & Lee invoices to be scrutinized. Craver copied his letter to the Governor and Attorney General.

What Field, the dissident LCCCA board members, and others questioning the Stevens & Lee bills did not know at the time, but subsequently learned, was that the firm had personnel working full-time on the project, and were its de facto developers and managers.

The time and energy the opponents to the convention center project devoted to the Stevens & Lee invoices was misplaced. During this period, the first six months of 2006, important contracts were being drafted, and they were being made without scrutiny.

Key agreements concerning bond financing; architectural design; shared space between the hotel and convention center; naming rights; permit waivers; consultant contracts; demolition of historic property and others were rammed through by Darcus with the votes of the other three city appointees over the pleas for more time to review by the county appointed minority.  Thereafter, the agreements were overlooked as the opposition focused its limited resources on the Stevens & Lee invoices.

Robert Field, with a well-earned reputation for unsparing and often harsh criticism of the foibles of others, is equally blunt with his self appraisal:

“The big mistake was that we did not voice objections at the very next meeting after having thoroughly reviewed the one-sided agreements. Instead, we took the Stevens & Lee invoices bait.

“We [the opposition's leading figures] were all working independently and were not even necessarily congenial with one another. There were no gatherings to discuss what we should do, no lawyers or public relations consultants to guide us, no word coming down from the top…

“The Stevens & Lee invoices issue seemed to suggest ongoing corruption as did the almost million dollars paid to Daniel Logan for services that remain obscure. It took until the end of litigation and the obtaining of the data behind the invoices before we recognized that Stevens & Lee with other high priced consultants were actually running the show on a daily basis.  It helped explain why Ted Darcus and David Hixson would not allow discussions at the meetings. They were but bystanders!”

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Chapter 24: Totaro’s Inquisition

(Twenty-first in the Convention Center series)

“Our goal is to be prudent towards taxpayers’ dollars.”

C. Ted Darcus, Chairman, Lancaster County Convention Center Authority board of Directors, 2006, explaining his board’s expenditures.

Lancaster County Ordinance number 44 of 1999 established a five percent room rental tax for every hotel and motel occupied in Lancaster County. Beginning on January 1, 2000, whether hotel and motel owners raised their prices by five percent, or took the levy out of existing rates, they were required by law to remit five percent of all room rental charges to the Lancaster county treasurer every single month of the year.

The treasurer would then send a check representing about sixty-two percent (62.4%) of the total room tax revenue to the Lancaster County Convention Center Authority. The rest of the tax revenue would go the Pennsylvania Dutch & Convention Visitors Bureau to market the center and promote the County as a tourist destination. The amount the treasurer sent to the Convention Center Authority came to about $3 million annually, depending on room occupancy. This money was spent solely at the discretion of the seven-member LCCCA board of directors.

James Pickard, the Authority’s initial Chairman and Executive Director, had enormous power in deciding how to apportion the funds. In 1999, after the LCCCA was established, Pickard was placed in his dual position by his close friend, Lancaster Mayor Charlie Smithgall.

Pickard served part-time, and took no pay for his work as Executive Director.

Prior to the project’s launch, it was Pickard as Smithgall’s special economic advisor who was tasked with finding a local buyer for the Watt & Shand building, eventually purchased by Penn Square Partners.

The City (read Mayor Smithgall) had also named the other LCCCA appointees, which made up the majority on the board, not that there was county opposition on the board in the early years. With Smithgall’s compliant, hand-picked appointees making up a majority on the board, that meant it was primarily the autocratic Pickard, the former Pennsylvania Secretary of Commerce during the Ridge administration, who decided on what to spend the tax money – and whom the board should hire.

The LCCCA had few fixed expenses. An Executive Director, when they found one, would be paid about $90,000 per year. The LCCCA office also employed a small, three-person administrative staff, which cost around $450,000, including insurance and benefits.

So, after these fixed costs, there was remaining approximately two and a half million dollars left to be spent by the Authority.

For the first three years of the LCCCA’s existence, its major non-fixed expenses went to legal fees.

The Authority had been challenged in court since early in 2000 by several local hoteliers. Millions of dollars were paid to Stevens & Lee and other law firms for legal defense. Stevens & Lee was also paid substantially for “negotiations” with Penn Square Partners, a potential conflict of interest, as the firm also represented High Industries, the General Partner of Penn Square Partners, as its registered lobbyist in Harrisburg. The LCCCA also hired legal counsel for the historic properties challenges it faced in 2001-2.

It is rare for a public authority charged with building $100-plus million projects not to have a paid professional executive director running the day-to-day operations from the start. But convention was something the Lancaster County Convention Center Authority was not following.

In the early years, from 1999 to 2002, the Authority effectively turned its planning, negotiations and decision-making over to the law firm of Stevens & Lee. In fact, for the first two years of the LCCCA’s existence, its offices were in the offices of Stevens & Lee, in the Fulton Bank building on Penn Square.

In the latter part of 2002 and the most of 2003, the LCCCA board was operating without a paid executive director. Pickard once again held the position de facto, without pay and on a part-time basis, after Michael Carper, a former president of a property management firm, resigned as Executive Director suddenly after six months in 2002.

It was on a rare Saturday LCCCA board meeting in March, 2003, when Chairman James Pickard recommended to the board that it hire two consultants.

One consultant, Daniel Logan, turned out to be something of a ‘mystery man’ in this story. Logan had already been tangentially involved in the project. Logan worked out of Philadelphia as the Lancaster Brunswick Hotel’s regional manager for the Philadephia-based owners, GF Management.  It was Logan, according to Mayor Smithgall, who failed to return Smithgall’s phone calls about putting the convention center project in Lancaster Square and incorporating the Brunswick. The brush-off from Logan irked the Mayor, Smithgall said, and he moved on to the Penn Square location for the project.

Whatever sour feelings existed between Smithgall and Logan didn’t override Pickard, who urged the LCCCA board hire Logan to analyze the “operating and marketing plan” for the project. The initial contract called for Logan to be paid $18,000 for a duration of three months.

After the three month contract with Logan expired in June, Logan continued to be paid $150 an hour. In the next year, Logan went on to be paid more than $200,000 without a LCCCA board-approved contract.

It wasn’t until June of 2004 that Logan submitted a “letter contract” to the LCCCA board. The contract finesses the lack of a previous agreement by saying Logan would be paid “the rate at which he has been paid prior to this date.” The contract with Logan was finalized on July 14, 2004. There was no time limit or cap on fees paid to the consultant.

The striking thing about the Logan hire is not the amount of money he was paid, a tab that eventually added up to nearly one million dollars in four years, but that there is almost no evidence of any work product performed by the man.

From an investigation conducted by journalist James Sneddon for NewsLanc.com, it is seen that Logan was very much a mysterious figure.

A former employee of the LCCCA described Logan as the “Invisible Man.” Almost no mention is made of Logan at LCCCA board meeting minutes.

However, according to another LCCCA insider, who spoke on condition of anonymity, Logan was Hixson’s “right hand man,” the ex-staffer said, “He was always with Dave.”

What he was doing “with Dave” is not clear from the invoices submitted by Logan to the LCCCA. The NewsLanc investigation, after examining the invoices, showed that Logan billed for hours he could not have worked. Logan sometimes billed for meetings with other consultants when those other consultants were not there.

Logan typically invoiced the Authority once a month, and billed in daily 8-hour, workday blocks. $1200 a day, $4800 per week, usually about $20,000 monthly.

Logan, from 2003 to 2007, was said to be involved in “pre-sales and marketing.” According to Hixson: “He [Logan] serves as community liaison to the Convention and Visitors Bureau which is obviously a very important working partnership with us in moving forward.”

But in 2005, when the Visitors Bureau held a “Meet us in Lancaster” event, a free weekend for booking agencies in the Baltimore metropolitan area, only Hixson attended. The sales and marketing consultant, Logan, was not present.

At a board meeting in 2006, county-appointed LCCCA board member, Laura Douglas, questioned Hixson about Logan’s one person, Medford, New Jersey-based firm, Growth Business Development:

“There are a number of these extremely high bills without itemization or some sort of results or some sort of actual work to show for it,” Douglas said.

“Sure, fair questions,” Hixson told Douglas and the rest of the board. “We have in our office itemization. Each month we receive the bills from various vendors and advisers that serve us. That is reviewed by me, as well as Willie Borden who is our Treasurer. We also run it by the Chairman [Darcus].”

“So what we do,” continued Hixson, “is review it in our roles as Executive Director, Treasurer, and as Chair, and then we submit the summary out to Board members, but certainly we have the itemization that is closely reviewed by the Treasurer and Executive Director.”

But when Sneddon, for NewsLanc, submitted multiple ‘right-to-know’ document requests to the Authority for the itemized invoices, he was stonewalled.

“Please be advised,” read a letter to Sneddon from the LCCCA, “that the LCCCA has provided you with full and complete invoices on file for the requested documents. Therefore, the LCCCA …. does not have additional information.”

Sneddon wrote: “Either Hixson lied about the detailed invoices, or they have been destroyed.”

The other consultant hired on that Saturday in March, 2003, was Robert C. Hazard, III.

Again, it was at Pickard’s urging that Hazard was hired by the Convention Center Authority.

Pickard told the Authority board why the project needed the Pittsburgh-based Metro Vision Company headed by Hazard.

“The need for Metro Vision relates back to the litigation and the pall it has put on the project. Because of the litigation, the Authority has been unable to attract qualified Executive Director candidates. … For 20 years Hazard has been actively involved in asset development business, specifically publicly owned or sponsored convention centers that headquarter hotel facilities,” enthused Pickard.

Hazard also had a connection to the project, having worked for Interstate Hotels, Inc., the company that was to manage both Lancaster Marriott Hotel and Convention Center facilities. In 2001, on behalf of Interstate, Hazard worked with the Authority on negotiations between the Authority and Interstate.

As with Daniel Logan, Hazard was rarely mentioned at board meetings minutes, and rarely seen at the meetings. And he, too, had examples of mysterious billings.

The NewsLanc investigation found that on two separate dates in September, 2003, Hazard lists “Presentation to LCCCA board and local stakeholders.” Yet no executive sessions or public meetings are listed for those dates.

Later, that same September, Hazard bills the Authority for 8.0 hours for a “Presentation to Government and High.” But records show Hazard didn’t get off the Pennsylvania turnpike in Harrisburg until 5:15 p.m. that day, then checked into his hotel. It is not reasonable that Hazard would be giving a “Presentation” to the “Government” and High well after normal business hours.

Hazard was paid more than $407,000 for twenty-six months of employment for the Authority. There is no trace of work product to show for that outlay.

Yet another costly consultant contract was given by the Authority in June of 2003. This one was one awarded to Philadelphia-based Fairmont Capital Advisors, “an independent financial advisory firm.”

Fairmont’s senior vice president was Thomas Beckett, who became the Authority’s principal financial advisor. Beckett was said to have 15 years municipal market experience, and was hired to provide expertise in the bond markets for the Authority.

Like Logan and Hazard, Beckett’s bills were simple statements that lacked detail. In just under three years, Fairmont billed $409,039 to the Authority, almost all from Beckett’s work.

Beckett’s rate started at $150 per hour, but spiked to $275 within one year. Until April, 2005, Beckett simply submitted hours worked for “consulting.” There was no more detail in the invoices. He was paid $280,000 for that unsubstantiated work. An example is an August, 29, 2004, invoice for “consulting” for 107.02 hours. Cost to the Authority:  $24,079.50.

In early 2006, when it came time to secure an underwriter for the issuance and re-marketing of 2003 and 2006 bonds, Beckett recommended as financial advisor, the George K. Baum & Company of Denver, Colorado. Baum had local offices in West Conshohocken, Pennsylvania. Baum was paid $130,000 out of bond issuing proceeds for its work.

Apart from the fees from the bond settlement, there was a separate bill from Baum for $25,937.50 for 103.5 hours of work at $250 per hour. The work was done by Baum’s new vice president – Tom Beckett.

Fairmont’s final bill was submitted to the Authority in February, 2006. Baum billed the Authority for work done March 7 to March 19, 2003.

Beckett’s dubious timing in recommending Baum, then joining Baum in time to bill more than $25,000 for Authority-related work, was not questioned by the LCCCA board, nor by reporters with any of the Lancaster Newspapers.

In September of 2003, ten months after Carper’s resignation, and after Logan, Hazard, and Beckett were hired, the LCCCA hired, again at the recommendation of James Pickard, David M. Hixson as its Executive Director.

Along with Hixson, who had worked in the press office of former Gov. Ridge, now Executive Director of the LCCCA, there was still another six-figure consultant who found a paycheck with the Lancaster County Convention Center Authority.

In March, 2005, at the request of the LCCCA board and at $350 per hour, a business consultant named Herman Bulls traveled to Lancaster from McClean, Virginia. According to documents investigated by Jim Sneddon for NewsLanc, based on expense records submitted by Bulls, he was in Lancaster from 11:30 am to 4:00 p.m. That 4.5 hours cost Authority $1575. Bulls also billed 5.5 hours in travel, for an additional $1925. Bulls billed a cool $3500 for the nine-hour day.

Bulls, a West Point graduate with a Harvard MBA, was representing his own firm, the Bulls Advisory Group, “a full-service Minority and Veteran owned real-estate firm, providing strategic advisory and implementation services to corporations, higher education, as well as state, local and federal government entities worldwide.”

During that visit, the LCCCA and Bulls agreed that Bulls’ firm would be engaged by the Authority. In June, 2005, the Authority hired Bulls’ managing partner, Maurice Walker, at $300 per hour.

Walker, with an MBA from the University of Virginia, had expertise in the commercial real estate and finance industries. Over an 18-year period Walker worked in the areas of development, technology, operations, investment asset management, compliance, business development/retention. He was a highly qualified consultant.

It was Walker who effectively ran the Authority, along with John Espenshade. He was indeed Hixson’s right-hand man.’

But like the other high priced consultants, Walker was either sloppy or deceptive with his invoices.

Sneddon’s investigation discovered that Walker billed the Authority twice on September 21, 2005, costing the Authority and extra $4200.

On December 31, 2005, Walker claimed in an invoice to have worked for 17.75 hours. This is on New Year’s Eve. That would mean Walker would have had to work from 6:15 to the stroke of midnight, with no breaks for breakfast, lunch, dinner, or a walk with the dog.

Maurice Walker was also paid his hourly rate as he traveled from his home in Bowie, Maryland to Lancaster. Each trip cost approximately $1200, plus mileage.

By the time Walker’s contract was terminated in 2007, after just over two years, the consultant had been paid $1,124,642.61.

The lack of spending oversight on the LCCCA board caught the attention of the Pennsylvania office of Common Cause, a leading non-partisan ‘good government’ organization. In May, 2006, Barry Kauffman, Executive Director of Common Cause/PA, wrote a letter to then-Pennsylvania Governor Edward G. Rendell, urging the Governor to direct the Auditor General to investigate the LCCCA.

Kauffman’s letter merited only a single sentence in a Lancaster Newspapers article, buried in the fifteenth paragraph.

Still, the Common Cause letter to Rendell was a stinging public indictment on the Authority’s operations. Kauffman writes:

“The apparent lack of transparency and accountability regarding this Project have prompted Common Cause/PA to express these concerns to you, and we ask that you instruct the Secretary of Community and Economic Development to 1) conduct a complete review audit of state funding pertaining to this project; 2) ensure that this Project is in full compliance with all state laws regarding grants, contracting public input and oversight; and 3) ensure that all public records about this Project be made available in full compliance with state law.”

There were other consultants who were well-rewarded by the Authority. A Lancaster public relations firm, Kelly Michener, was paid hundreds of thousands of dollars, again with little apparent work product. A company called E4 Exchange, was able to bill the Authority tens of thousands of dollars for apparently phantom work.

But the consultants did help the sponsors in one aspect; they captured the attention of project critics. And that was a very useful role, indeed.

###

Chapter Twenty-Two: ‘An alternate use for the site’: The PKF Feasibility Study

(Twentieth in a series)

While the uncertainty of the convention center project did not affect the die-hard incumbent Republican Charlie Smthgall’s campaign for Mayor of Lancaster in 2005, it did influence his Democrat opponent, Rick Gray.

Gray was a local defense and ACLU attorney with a reputation for representing the disreputable. The burly, goateed, bow-tied Gray seems to have endured a political Hamlet-esqe struggle on the public stage.

“The project proposed by Penn Square Partners holds a promise of good for the county, the city and the school district,” candidate Gray stated on March 22, 2005.

In September, 2005, two months before the election, Robert Field met with Gray at Gray’s invitation in response to a letter Field had sent him. According to Field, Gray indicated concern about the feasibility of the project. Field advised not opposing it, but putting some space between Gray and the project so that project opponents would be more likely to vote for Gray and Gray would be more at liberty to research and decide when he took office.

This conversation between Gray and Field was reflected shortly after in a Lancaster New Era article, October 13, 2005:

“If elected mayor, Rick Gray would immediately meet with his top advisers to evaluate the viability of the downtown hotel and convention center….Keeping the county commissioners’ concerns in mind,’ he told the Lancaster Rotary Club Wednesday, if he and his advisers decide it is not what the city needs, Gray said he’d ‘pull the plug’; on the $134 million project. . . .”

On October 31st, Pat Brogan, who had come from State Rep. Mike Sturla’s office to be director of “Campaign Issues & Communications” in Gray’s campaign, wrote to Field:

“If elected, Rick Gray will convene a group of objective individuals to discuss how this project can be moved forward in an expedited manner. If this group determines that the project cannot proceed on a timely basis, Mr. Gray [will] work with the group to develop an alternate plan.”

Then on December 09, 2005, after his election and only weeks before being sworn in, and after reading a memo from the firm that performed a market study of the project disavowing the current enlarged project, Gray said again: “We’re taking a good look at the project right now with the idea of whether we can move it ahead or not.”

Twenty-five days later, on January 4, 2006, one day after taking his oath of office, Lancaster Mayor Rick Gray strode into the Farm & Home Center, a large meeting venue just outside of Lancaster city. He was about to make his position on the convention center issue perfectly clear.

A public meeting was taking place. The meeting was called by the three new county LCCCA appointees – Douglas, Hall, and Craver — to hear from the public on the project. None of the city appointees were present, nor was Executive Director, Dave Hixson, or solicitor, John Espenshade. The room was filled with more than two hundred citizens.

Most in the room were opponents of the project.

The audience quieted as the new Mayor approached the microphone. Then, in sharp, combative, almost hostile tones, Gray voiced strong support for the project and his frustration at project opponents for trying to stop it.

“Where are your alternatives?” Gray snarled. “If we don’t use this money it’s going somewhere else. If we don’t use it, it’s gone.”

The crowd was stunned. A few clapped. Some booed. Most were quiet. Then Gray turned and strolled out of the room.

But the time was not far when the new Mayor would appear to modify his position.

At this point, late 2005, early 2006, Robert Field had zeroed in on the issue of the absence of a true feasibility study ever performed on the convention center-hotel project.

In separate letters, Field wrote to out-going mayor Charlie Smithgall, Mayor-elect Gray, LCCCA Chairman Ted Darcus, Rep. Mike Sturla, Sen. Armstrong, the president of the school board, president of city council urging each to support a full feasibility study be conducted on the project.

Even Carrie Steinman Nunan, an heir to the Steinman empire, received a letter from Field urging a full feasibility study. Despite the cordial, first name relationship between Ms. Nunan and Field, there was no response.

In a December 29, 2005 letter to New Era editor, Ernie Schreiber, Field wrote: “Something very positive you could immediately do is to write an editorial calling for the County, City, and Authority to jointly commission a genuine feasibility study….”

Field went before the County Commissioners, as well as the LCCCA board.

“It is sorry commentary on the local monopoly print media that a private citizen should have to … expose the false characterizations of pivotal studies pertaining to the Convention Center and Hotel project,” he said to both boards in prepared remarks.

The issue of having an actual feasibility study done on the project got an unexpected boost on January 11, 2006. Exactly one week after he publicly denounced opponents of the project and spoke in favor of it, newly elected Lancaster City Mayor Rick Gray ‘crashed’ the County Commissioners weekly public meeting, and played the role of Hamlet again.

Standing in the back of the room, still wearing his overcoat, Gray told the Commissioners that if they wanted a feasibility study done, they should have Pricewaterhouse update its earlier studies, and the Commissioners should pay for the cost of it.

The Commissioners thanked the mayor for his time, and said they would consider it. Gray then turned and left the meeting without ever sitting down.

Within 90 minutes of Gray’s offer, Field was briefed in his office by a meeting attendee on what the Mayor said. Field immediately spun around in his chair to his computer and wrote a joint letter to Shellenberger and Gray (copying all three Lancaster newspapers), saying he would subsidize the cost of the feasibility study in the amount of $50,000.

“I applaud Mayor Gray’s suggestion that the Commissioners order and pay for a feasibility study and his commitment that, if the project is not feasible, to end his support for the $137 million downtown revitalization initiative. ….

“Should funding be an obstacle, I am prepared to contribute $50,000 toward the cost of a comprehensive feasibility study of the convention center and hotel, …”

Mayor Gray seemed to back away from his position almost immediately. When Commissioner Shellenberger announced on January 14 that another firm should perform the study because of a statement made by one of the Pricewaterhouse consultants distancing the firm from its earlier studies, Gray blasted Shellenberger calling the move “wasteful” and “unnecessary.”

The County Commissioners capitulated to Mayor Gray’s insistence that Pricewaterhouse conduct the study. At its January 18, 2006 public meeting, the Commissioners voted to authorize special counsel, Howard Kelin, to contact Pricewaterhouse about conducting a full feasibility study for the now $137 million project. One week later, Kelin wrote a letter to the firm about re-engaging it for the new study.

But Gray still objected. In addition to Pricewaterhouse doing the study, and imposing a hard 60-day deadline from January, 11, 2006, in a letter to Shellenberger dated January 20, Gray insisted Pricewaterhouse “evaluate the changed project on the same basis as the earlier project was evaluated.” The last caveat would ensure that a market, not a feasibility, study would again be performed.

The debate on whether Pricewaterhouse should perform a full feasibility study on the hotel and convention project was ended when the firm declined to participate in the study on January 28. There was no public explanation given for turning down the work.

On February 9, 2006 – four full weeks after Mayor Gray’s proposal and Field’s $50,000 subsidy offer – the Lancaster County Commissioners still had not commissioned a full feasibility study.

Commissioners Shellenberger and Henderson were receiving other pressures regarding who would conduct the study. The Uptown Economic Development Corporation (UEDC) is an organization comprised primarily of local black business and community leaders. In a letter to Shellenberger dated January 19, 2006, Rev. Roland Forbes, chairman of the UEDC, wrote:

“Recent revelations surrounding the absence of an actual feasibility study have only added to our anxiety. We applaud the efforts of Mayor Gray and you are making to address this glaring due diligence omission. However, total reliance on Price Waterhouse Coopers to review its earlier reports will not instill the project with the public confidence it needs. What is required immediately is an independent peer assessment.”

Forbes continued to recommend that an Orlando, Florida-based firm, ZHA, perform the feasibility study because, he wrote, “ZHA … has no vested interest in this deal.”

At the Commissioners’ weekly meeting on February 9, at which several members of the city’s Uptown Economic Development Corporation (UEDC) spoke in favor of a full feasibility study, the Commissioners voted to send out Requests for Proposals for a full feasibility study.

“Some of us conclude that there has been a rush to judgment,” said UEDC member, Rev. Earl Harris, to the Commissioners, invoking the Johnny Cochran phrase, and perhaps sending a coded message with respect to selecting a firm.

What happened next was a strenuous debate among Shellenberger, Henderson, and Robert Field. The Commissioners individually spoke separately with Field regarding which firm to select to perform the study.

The Commissioners were, in mid-February 2006, significantly politically damaged by extensive Conestoga View and now grand jury coverage in Lancaster newspapers. They were now torn between the UEDC recommendation of ZHA, and Robert Field’s opinion that the international hospitality consultancy of Pannell, Kerr, Forster (PKF) should be selected.

“It was vital that a top firm conduct the study,” said Field. “It had to be a firm whose credentials and reputation could not be questioned. PKF was one of the few who could meet the highest standard.”

The Commissioners were eventually persuaded to choose PKF. On February 16, 2006, Commissioners Shellenberger and Henderson voted to hire PKF to perform the feasibility study (Shaub dissented). The cost: $115,000.

To fit the outlay into the Commissioners discretionary budget, Field raised his pledge to $65,000. “This is something that needs to be done, and which will ultimately bring this community together,” he told the Intelligencer Journal.

In choosing PKF, the county was selecting one of the industry’s most respected firms in hospitality consulting, with a track record with some of the largest hotels and convention centers in the United States and the world.

PKF consultants sought the cooperation of the principals – the LCCCA, RACL, Penn Square Partners. But this cooperation was not forthcoming. In fact, efforts were underway by these entities to discredit the study before it even began its work.

###

Chapter Twenty-One: ‘Free Money’: The LCCCA pays its Consultants

(Eighteenth in a series)

“I don’t believe in serving on boards where I am not wanted.”

– John Fry, then President of Franklin & Marshall College, in his letter of resignation from the Convention Center Authority board to Commissioner Dick Shellenberger, 2005.

“Quite simply, the Convention Center Authority was the worst organization I have ever encountered, let alone been a part of. It is very clear that the Authority had no regard for the source of its revenues, the taxpayer.”

– Laura Douglas, appointed by Lancaster County Commissioners Shellenberger and Henderson in September 2005, referring to her service on the Convention Center Authority board of directors

In September of 2005, the Lancaster County Convention Center Authority (LCCCA) board of directors would have been firmly counted in the sponsors’ column.

At the LCCCA’s inception in September, 1999, both the County Board of Commissioners and the Lancaster city mayoralty were controlled by strong supporters of the project. This meant that sponsors were able to name all seven members to the LCCCA board. And the decisions the board made consistently reflected the sponsors’ positions on the project.

In 2003, as LCCCA terms ended, Commissioners Thibault and Shaub, and Mayor Smithgall, were again able to appoint or re-appoint those who reflected their support of the project. According to the enabling County Ordinance 44, the LCCCA terms were two, three, and four years in duration.

One problem the sponsors did not anticipate until 2007 was the composition, and cooperation, of the LCCCA board.

In 2007, the ’swing vote’  would revert to the County – now effectively Shellenberger and Henderson. That was when the sponsors expected the county would pose a problem to the LCCCA board.

It happened earlier than the sponsors anticipated.

On, September 1, 2005, the three county-appointed board members were: Judy Ware, John Fry, and Garth Sprecher.

Ware was a former art teacher and a philanthropist whose four-year term was ending on September 15, 2005. During her time on the board, Ware was regarded as an enthusiastic supporter of the project. Although Ware and the sponsors of the project wanted her to be re-appointed to the LCCCA board, Shellenberger and Henderson chose to replace her when Ware’s term expired.

Ware’s replacement on the LCCCA board was Laura Clampitt Douglas, a tough, smart, Texas-born businesswoman who didn’t suffer fools. At Douglas’ first LCCCA board meeting, she peppered then-board chairman, Ted Darcus, and executive director, Dave Hixson, with questions and comments on bills the board was paying. Normally, the board paid the bills without discussion.

John Fry was then president of Franklin & Marshall College, the private, liberal arts college located in the northwest section of Lancaster city. In 2003, Fry was appointed to replace Jim Pickard on the LCCCA board. Pickard’s second term had begun only a month earlier. (Pickard, the Board’s first Chairman and Executive Director, stepped down from those positions in 2002, but remained a voting board member until resigning from the board entirely in 2003.)

“We are lucky to have someone of John Fry’s caliber on the board,” said a beaming (soon to be ex-) Commissioner Paul Thibault, announcing Fry’s appointment, in October, 2003.

Fry, like Judy Ware, was known as a committed supporter of the downtown project.

It was assumed Fry’s term ran until 2007. However, when Fry was named to the LCCCA board at a regular Commissioners’ meeting in 2003, it was recorded in the minutes of the meeting that his term would end in 2005. A letter sent to Fry confirming his appointment transcribed the error from the minutes, with the letter also stating that the term would end in 2005.

One afternoon in late September, 2005, with these two documents – the minutes and the letter – Commissioner Shellenberger brought County Treasurer and fellow Republican, Craig Ebersole, to meet with Fry. Shellenberger showed Fry the letter and minutes indicating his term was expiring. The next day Fry submitted his resignation to the County Commissioners.

“I don’t believe in serving on boards where I am not wanted,” Fry wrote in a letter to Shellenberger. “For reasons that are not clear to me, you have requested that I immediately submit my resignation as a member of the Authority.”

Shellenberger and Henderson appointed Deb Hall, president of the Ephrata Chamber of Commerce, to replace Fry on the LCCCA board. Like Douglas, Hall was intelligent and tough-minded. If anything, she had a harder edge than Douglas, and she, too, had questions about the project.

In October of 2005, businessman Garth Sprecher, was one of only two original board members still serving on the LCCCA board. Citing fatigue, Sprecher announced he was resigning from the board on October 15.

“Don’t read anything into this,” Sprecher said of his resignation at his last LCCCA meeting. “I’m just tired.”

Sprecher’s seat was temporarily filled by Timothy Lease, general manager of a large Mountville motel. Lease resigned suddenly after less than a week due to personal issues. He was replaced weeks later by another Shellenberger and Henderson pick, Jack Craver. Craver was a former hotel executive with decades of top-level experience in the hospitality industry, including management of the world renowned Plaza Hotel in New York City.

The changing face of the Convention Center Authority board meant that the days of unquestioned ‘rubber stamping’ of agreements and consultants’ fees were coming to an end. If the LCCCA board was going to debate amongst itself about documents and invoices, then the project could be delayed, perhaps even terminated.

The addition of county appointees Laura Douglas, Deb Hall, and Jack Craver to the LCCCA also promised to make it a much more confrontational board.

“We selected these people because they were going to ask questions that we were not getting answers to,” said Shellenberger. “We hoped the [LCCCA] board would answer their questions.”

The LCCCA board that Douglas, Hall, and Craver joined was led by Chairman, C. Ted Darcus.

If former County Commissioner Paul Thibault (an academic raised in Canada) was an unlikely player in insular Lancaster politics, Ted Darcus was an even rarer find. Darcus, short, black, and Republican, who grew up in Fairmount, West Virginia, found himself, in late middle age, something of a political powerhouse in the city of Lancaster, Pennsylvania.

Before coming to the LCCCA board in 2003, Darcus was president of the Lancaster City Council. In 1999, Darcus voted with the majority of city council to establish the LCCCA.

Darcus, the longtime executive director of the Boys & Girls Club of Lancaster, was also closely involved in the building of the new Bright Side Baptist Church in Lancaster city. Bright Side, founded in 1980 in Lancaster city, is a large Baptist church and community center that currently leases space to a branch of Fulton Bank within its walls.

Bright Side, in its new, $5 million facility built in 2003 on the corner of Hershey and Wabank Avenues, serves a mostly African-American population, providing education, youth, and employment services. It is a center of the African-American community in Lancaster. Bright Side particularly serves the local youth community, Ted Darcus’ clientele, and has many services for them, including after-school programs, education tutorials, day camps, and summer excursions.

A clue to Darcus’ seeming change in disposition on the LCCCA board can be found on one wall of the large, full of energy Bright Side center. On that wall, one will see plaques listing the major donors for the new Bright Side, including High, Buckwalter, and Fulton.

Some critics have wondered whether Darcus, a leading fundraiser for Bright Side, was influenced in his actions on behalf of the convention center project by the substantial financial donations to Bright Side from project sponsors.

On January 12, 2004, the 63 year-old Darcus was voted by his fellow board members chairman of the Convention Center Authority board.

Darcus seemed to take his meeting management style from his predecessor on the board, Jim Pickard, who ran the LCCCA meetings with an imperious iron gavel. As with Pickard, under Darcus, questions from the public – during public meetings – went unanswered.

Ted Darcus could be a rude and belligerent chairman. Darcus had a habit of intentionally looking down at his desk when a member of the public was speaking, often pretending to read or write while citizens tried to make their points. Questions from board members were openly discouraged.

With Darcus as Chairman, no LCCCA committee met on a regular basis.

Rodney Gleiberman, general manager of the Continental Inn and a plaintiff in lawsuits against the LCCCA, and who attended dozens of meetings chaired by Darcus, had this blunt assessment of the Chairman:

“Ted Darcus was a hot-headed, dimwitted, single-minded presence on the Authority board. The man has very poor communication skills. While these might be tolerated qualities in a private company, they are totally inappropriate for running a ‘public’ entity. He was an embarrassment as chair of the LCCCA board of directors.”

Laura Douglas, the businesswoman appointed by the County Commissioners in September,2005, and who served until 2008, said of her time on the LCCCA board:

“Quite simply, the Convention Center Authority was the worst organization I have ever encountered, let alone been a part of. It is very clear that the authority had no regard for the source of its revenues, the taxpayer. … Mr. Darcus was a very strongly divisive force on the board. He was blinded by certain issues, and instead of considering them, would go ahead and move forward.”

The other three city appointees were notable for not being noticed.

Willie Borden Jr. was the only original member still on the LCCCA board. Borden, a journeyman electrician with power company PP&L, barely spoke at the meetings, and almost never voted against Pickard and the majority of the board. His was a dependable vote. Borden held the board position of Treasurer.

Dave Schwanger owned a successful heating oil company with his brother. In 1998, Schwanger was recruited by Sen. Gib Armstrong to run against Rep. Mike Sturla for Sturlas’ seat in the state legislature. (Schwanger was trounced on election day; Armstrong won easily). Schwanger was also close personal friends with project sponsor, Lancaster Mayor Charlie Smithgall, who named him to the LCCCA board. Schwanger was even less noticeable on the dais than the practically mute Borden. He, too, voted with the other city members en bloc.

The fourth member of the city’s LCCCA appointees was Joseph Morales, a native of Brooklyn who came to Lancaster during his teenage years in 1978. Morales worked as an instructor and administrator for IU13, an education services organization that serves public and private schools in Lancaster and Lebanon counties. Morales was more vocal during public meetings than either Borden or Schwanger, occasionally commenting on an agreement, or making a statement, but, he like the other city appointees almost never broke ranks when it came time to vote.

(Since leaving the LCCCA board in 2007, Morales has been the well-paid executive director of the controversial Lancaster Community Safety Coalition [LCSC], a privately-owned organization that has hundreds of surveillance cameras throughout downtown Lancaster. The LCSC is a subsidiary of the Lancaster Alliance, the organization founded by Dale High, Rufus Fulton, Jack Buckwalter, and nine others in 1993.)

So while the city appointees, with the exception of Ted Darcus were not demonstrative, and none had expertise in the hotel or convention center industry, there was little question how the city’s appointees saw their roles on the board.

The schism between the city and county appointees on the LCCCA board was used by supporters of the project as an example of the County Commissioners’ supposed anti-city bias on the project.

“I always had a problem with the idea that I was ‘anti-city,” Shellenberger said after he left office. “I was very familiar with the city, and I wanted to do what was best for the city. We [the Commissioners] supported Clipper Stadium, invested in the Northwest Corridor, and other important city projects. Again, the convention center involved county taxpayers’ money, and we didn’t want the public’s money wasted, or poorly spent.”
The LCCCA had two more people on the board who would have to be considered in the sponsors’ camp.

One was David M. Hixson, the board’s Executive Director. Hixson was the third Executive Director hired by the Authority. The first was Pickard, who was both Chairman and acting Executive Director at the board’s inception in September, 1999. Pickard stepped down as Executive Director in the spring of 2002, and Michael Carper, a former banker and property manager with hotel executive experience, was hired shortly afterward to replace him.

Carper quit suddenly after just six months on the job. The circumstances of Carper’s departure were sealed in the confidential termination agreement between Carper and the Authority.

Hixson was hired in the summer of 2003 to oversee the Authority’s day-to-day activities and manage all phases of the project – contracts, construction, personnel, bill paying – from the Authority’s position.

The round-faced, bespectacled, Hixson wasn’t a particularly articulate or dynamic speaker. Hixson had no experience in either the hospitality or convention center industries. Most of his former positions were as a political press spokesperson. He had a supervisory position with the department of labor in the Ridge administration before coming to the Authority.

Hixson didn’t appear to grasp some of the more complicated details of the project, seeming rather lost at times during meetings. But whatever ability Hixson lacked didn’t discourage Jim Pickard from recommending him. On that basis, Dave Hixson was hired for the $80,000 a-year (plus benefits) position. One month after Hixson was hired, Pickard resigned from the board.

When either Ted Darcus or Dave Hixson had a question, they would look to the end of the dais for the answer. Seated there, as he had since the first LCCCA meeting in 1999, was a quiet, suited, bespectacled, middle-aged man intently monitoring each meeting. This was John Espenshade the LCCCA’s solicitor of the law firm of Stevens & Lee.

Although the LCCCA board was divided 4-3 in favor of the sponsors, with Hixson and Espenshade, it was more like a 6-3 division, with the sponsors controlling the Executive Director, Chairman, and Solicitor positions.

Whether it was a one vote, or three vote advantage, for the time being, sponsors of the project clearly controlled the LCCCA board. Holding that advantage would not be easy.

###

Chapter Nineteen: Witch Hunt

(Seventeenth in a series)

With Robert Field added to the growing number of those openly questioning the convention center and hotel project, sponsors of the project now faced formidable opposition.

The emergence of April Koppenhaver, Randy Carney, and Field, along with Ron Harper, Jr., and others, meant that the Lancaster County Commissioners, specifically Dick Shellenberger and Molly Henderson, had a swelling of support behind them in their challenge to the increasingly expensive, taxpayer subsidized project.

Since the early part of 2005, before the TIF vote, it was apparent Shellenberger and Henderson were going to examine a variety of concerns regarding the project, including the $40 million county guaranty, the hotel room tax, and other issues related to the feasibility of the project. A possible lawsuit challenging Act 23 funding was also publicly discussed by the two Commissioners.

It was the late spring of 2005, and the project was far from complete. Not a shovel of dirt had been turned, funding was not secured, architectural drawings were not finished, and the public was demonstrably becoming more impatient and resistant to the project. It was a project with a very uncertain future.

Then the sponsors were presented with an opportunity which they seized with gusto. It came in the form of the sale of a 200 year-old, county-owned nursing home called Conestoga View.
Prior to the summer of 2005, if the Conestoga View nursing home was mentioned at all in any of the Lancaster newspapers, it was in the obituary section. By the end of the year, Conestoga View made the front pages, the editorial pages, and letters-to-the editor pages almost every day of the week.

The facts around the sale of Conestoga View began in the summer of 2003.

The idea to sell the facility, which employed about twenty percent of the county workforce and housed the county morgue in its basement, as well as a youth intervention center on its 40-acre grounds, was first raised sometime during the campaign summer. It was then when sitting commissioner Pete Shaub brought it up with county solicitor, LCCCA solicitor, and Stevens & Lee partner, John Espenshade.

During the summer of 2003, Shaub and Shellenberger, despite differences in temperament, often campaigned as a team. In September, when Shaub spoke to Shellenberger about the possible sale of Conestoga View, Shellenberger agreed with Shaub that the county should sell the facility. Both believed that selling Conestoga View was consistent with their interest in shrinking government, a standard part of the Republican platform.

“Conestoga View was losing money, and we felt this was the kind of thing that government should not be doing,” said Shellenberger after he left office. “This was the philosophy I campaigned on. Anything the private sector can do, the government should not be competing in and doing.”

Since Shaub was the only sitting commissioner during these pre-election meetings with Shellenberger and Espenshade, they were not in violation of the state’s open meetings, or Sunshine Act, requirements.

After taking office in January, 2004, Shaub and Shellenberger, along with solicitor Espenshade, continued to pursue selling Conestoga View to Complete Healthcare Resources, the private company that had operated the facility for more than a decade. But now that Shellenberger was in office, meeting with Shaub privately to discuss potential legislation meant possibly violating the ‘Sunshine’ law.

The two Commissioners, Shaub and Shellenberger, according to a later grand jury investigation into the sale, deliberately and carefully kept newly-elected Commissioner Henderson ‘out of the loop’ and completely ignorant of these ongoing negotiations. Shellenberger and Shaub were able to circumvent the Sunshine law restrictions by either meeting with Espenshade individually, or by using a common practice known as “walking the halls.”

‘Walking the halls’ is a term used to describe a practice where a surrogate of one official, in this case a County Commissioner, meets with another Commissioner. Then the surrogate ‘walks the halls’ back to the other commissioner’s office and briefs him. This goes back and forth, and it is done frequently as a practical way of not awaiting a public meeting in order to discuss matters between a quorum of Commissioners.   (Only two of the three commissioners make up a quorum!)

The person walking the halls on behalf of then-board Chairman Shaub was County Administrative Officer, Don Elliot, (who happened to use Penn Square Partners’ Nevin Cooley as a professional reference on his application to the county).

The person walking the halls as Shellenberger’s representative was an administrator with a newly created position of Chief Services Officer (CSO) named Gary Heinke.
Gary Heinke and Dick Shellenberger were close personal friends. For several years, they had been active fellow church members, and regularly socialized together before Heinke left Pennsylvania, and moved with his family to Minnesota.

After Shellenberger won the Republican endorsement in early 2003, he contacted Heinke and asked his friend if he would be interested in returning to Lancaster to work as the Chief Services Officer for the county after Shellenberger took office.

Heinke was interested, and Shellenberger, Shaub, and Espenshade all helped Heinke get the job. The three sent Heinke material and job-related questions in advance of the formal interview for the position. Shaub, Shellenberger, and Espenshade also had several meetings with Heinke, none of which the other candidates for the position received. (Elliot was the only candidate to receive advance material for the Chief Administrative Officer post.)

Neither Commissioner Henderson nor the county human resources department were aware of the preferential treatment afforded Heinke and Elliot.

With unanimous Commissioners’ approval, Heinke was hired as Chief Services Officer. He began work on March 29, 2004. Weeks later, his job responsibility was expanded to include supervising five new departments, and overseeing Conestoga View.

During 2004, as negotiations continued between Shaub, Shellenberger, Espenshade, and the private company operating Conestoga View, the relationship between Shaub and Shellenberger deteriorated drastically.

The high-strung, combustible Shaub, who in his previous term often clashed with fellow Republican, Paul Thibault, frequently lashed out publicly at his fellow Commissioners.

“I’d like to know which side of your mouth you are speaking out of today,” he told Commissioner Molly Henderson at one meeting.

At the turn of the year to 2005, Shellenberger and Henderson staged a ‘coup’ for the Chairman’s seat, and voted to place Shellenberger as chairman of the board of Commissioners. Shaub was livid that he lost the Chairman’s seat to Shellenberger. Shaub was also bitterly angry at Henderson, whose vote enabled Shellenberger to depose Shaub.

The animosity between Shaub and Commissioners Shellenberger and Henderson was exacerbated by their present positions on the convention center project. Shellenberger and Henderson were increasingly concerned about the convention center financing and feasibility, and demanding answers from project sponsors. Shaub remained a staunch supporter of the project.

The deal Shaub, Shellenberger, and Espenshade were hammering out with Complete Healthcare Resources had the county selling Conestoga View and its grounds for a total of $13.5 million – $8.5 million for the buildings, the rest for compensation and assurances that no job cuts would be made and no indigent patients denied care. The facility had a long history of caring for the elderly poor.

The morgue and the youth intervention facility would remain on the grounds.

On July 6, 2005, at a regular Commissioners’ meeting, all three Commissioners’ voted to enter into an agreement to sell Conestoga View. This meant they were intending on finalizing the sale at a later date.

The first reaction to the now-pending sale in the Lancaster Newspapers appeared on July 10, 2005, in the “Coffee with Clyde” column, written by then-Sunday News editor, Dave Hennigan.

The “Clyde” columns were a collection of observations and homilies put forth by Hennigan’s alter ego, Clyde. But the column printed on that Sunday in July had a decided edge to it. And it may be there was a voice other than Hennigan’s whispering in ‘Clyde’s’ ear.

Below is the first reaction to the issue that would dominate Lancaster Newspapers’ coverage more than any other in its history:

“July 10, 2005

Coffee With Clyde

Good morning, Clyde. What’s going on?

“The county commissioners played a little ‘full steam ahead’ on Wednesday,” my jogging friend said, sipping his coffee.

Indeed, Clyde. What do you mean?

“They approved the sale of Conestoga View in record time, Mr. Editor. It took the commissioners only six days from when it became public to unload a piece of Lancaster.”

What’s the point, Clyde?

“What’s the rush, Mr. Editor? They pulled this stunt over a holiday weekend, when few people could react, and when a couple did complain, they ignored their request to postpone the vote…”

Hennigan’s column did mention that Commissioner Henderson requested more time for public input before voting on entering into the sale agreement, but Shaub and Shellenberger wanted the vote done on that date, and it was passed. Soon, the newspapers’ coverage conflated Henderson with the other Commissioners’ involvement in pushing the sale.

After the July 6 vote, as if by orchestration, waves of letters to the editor opposing the sale also began to appear in all three papers.

“Last Wednesday, I learned that our county commissioners had been in secret negotiations for many months to sell the Conestoga View Nursing Home,” read one letter printed in the Intelligencer Journal on July 14, 2005.

“I would like to let the public know how the sale of Conestoga View has affected the staff and residents. The staff and residents were informed of the sale the morning before it came out in the evening newspaper. That was a slap in the face,” read another in the Lancaster New Era on August 13, 2005.

These letters were typical, and they were printed by the dozens during those summer months.

A readers “poll” in the Intelligencer Journal showed 96 percent of the self-selected respondents opposed the sale of Conestoga View.

Prominent political officials and ex-officials (all ardent convention center supporters) – like former Mayor Art Morris, former County Commissioner Paul Thibault, and then-Lancaster city Mayor Charlie Smithgall – all very publicly voiced opposition to the sale. Morris was especially critical in his rebuke of all three County Commissioners.

By the time the final sale agreement for Conestoga View was voted on, on September 28, 2005, the unlikely issue of nursing home sale was front page news.

And it was just the beginning of the story.

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Chapter Eighteen: A Board Divided: Convention Center Authority Splits in Two

(Sixteenth in a series)

Until 2005, Robert Field, was largely unknown to the general Lancaster County public, a place that had been his home for almost 40 years. But the Philadelphia-born Field, then in his late sixties, was not completely anonymous in Lancaster. Field was a man of education, ability, and means, whose local friends and acquaintances included academics, musicians, and some at the top of the local Lancaster establishment.

Robert Field was then chairman (and founder) of the Lancaster-based, The Manor Group, “a family of independent companies.” The Manor Group developed and managed apartment complexes and hotels, in the mid-Atlantic region of the United States.

Field owned no hotels in Lancaster County, and thus had ‘no dog in the fight’ concerning the current downtown project. Field hadn’t paid much attention to the issue, but now, with the recent media focus on the project, he became more interested in the matter.

“Our firm had twice over a decade looked into buying the Brunswick Hotel,” said Field. “But we declined because we recognized the scant market for a downtown hotel. I came to feel morally compelled to raise questions about building yet another hotel in the same market.”

In April, 2005, Robert Field went to the Penn Square office of Rufus Fulton, CEO of Fulton Bank, to discuss the project with him. Fulton, whose bank held the smallest stake in Penn Square Partners, referred Field to Jack Buckwalter, Chairman of Lancaster Newspapers. Buckwalter, in turn, suggested that Field meet with Dale High, CEO of High Industries, and the general partner of Penn Square Partners.

The three meetings took place over a four-day period. Field recalled the meetings:

“My conversation with Rufus at the bank gave me reason to believe that he lacked confidence in the convention center project. I surmised that Fulton felt obliged to go along with major clients of the bank by taking a small partnership interest. Jack, at the newspaper, explained that he had been immersed over the past year in directing other Steinman enterprises, and had left the convention center project in the hands of Dale High. When I met with High, I asked Dale if there was a feasibility study, and he said ‘Yes,’ but he declined to let me see it. He did not dispel my perception of the existing downtown hotel market (or lack thereof.) According to Dale, he had assurances from major firms that they would move to downtown provided the convention center project went ahead. High’s explanation of why the new hotel would succeed struck me as: ‘If we build it, they will come.’”

In October, Robert Field shared his thoughts on how best to develop the Watt & Shand site and downtown Lancaster in an Op-Ed piece that appeared in the “Perspective” section of the Sunday News. In that article, Field suggested a mixed-use, residential and commercial, for the building.

There was another aspect of the project that brought Robert Field into the convention center battle. Field bristled at the Lancaster Newspapers reports suggesting only a few dissident Lancaster County citizens objected to the project.

“I read in the Lancaster Newspapers that the only a small group of obstructionists opposed the convention center project,” Field said. “I just didn’t believe that.”

Field was also a veteran political activist, having in 1980 been Sen. Arlen Specter’s campaign finance chairman, and a longtime leader in the drug policy reform movement. He went to Fox 43 Television in York, Pennsylvania, and encouraged them to sponsor a public opinion survey of the project, at Field’s expense.

The questions for the poll were developed by Fox 43 news and Opinion Dynamics, a nationally well-known polling firm that performed surveys for the Fox network among many other national clients.

The startling revelation of the Fox poll results was that 78% of those with an opinion disapproved of the county guaranteeing any portion of the convention center bond issue.

Dissatisfied with how the newspaper reported the principal findings of the poll, Field paid for a half-page advertisement in the morning and afternoon newspapers for the publication of the entire report.

A short while later, Field received a parcel, sent anonymously, which contained all of the studies done on behalf of the project. Field, a builder for decades of projects large and small, was astonished. None of the studies were “feasibility studies,” as purported by project sponsors.

“All of them were ‘market studies’,” Field said. “Market studies do not include projections of economic viability, profits or loss.”

Field contacted American Valuation Group, Inc., a firm of Appraisers Institute-certified appraisers. The Appraisers Institute  is the leading organization for professional real estate appraisers. It establishes standards and practices for real estate appraisal. One of the American Valuation analysts, Mark Kenney, Member, Appraisers Institute, examined each study and wrote:

“In conclusion, my review of the five reports discussed above indicates that they are intended to be market or marketability studies, and neither are represented as feasibility studies nor include sufficient information and analysis required to be considered feasibility studies.”

Field released the American Valuation report to the media.

After reading Kenney’s analysis, Field became concerned about an application the LCCCA had submitted to the state three years earlier, in September, 2002. James Pickard, at the time chairman of the LCCCA board, had represented the following on an application for a $15 million grant:

“Please see the attached Market and Economic Analyses for the Proposed Lancaster County Convention Center prepared by PricewaterhouseCoopers, LLC. This report represents the results of the market and economic feasibility for the project and includes a recommended building program and utilization estimates as well as a financial and economic impact analysis. [Emphasis added.]”

For six years, sponsors of the project had freely used the term “feasibility study” to describe studies that had done on behalf of the project. Field discovered – and had certified – that no true feasibility study had actually been performed on a project.

Robert Field, a man accustomed to getting things done, would see that that would change.

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Chapter Seventeen: Conestoga View

(Fifteenth in a series)

With the RACL purchase of the Watt & Shand building, the city authority would now apply for state loans or bonds on two issues of $24 million and $12 million, totaling $36 million. The bonds for the $12 million issue would be funneled through the Department of Community and Economic Development (DCED) under the Infrastructure and Facilities Improvement Program (IFIP), ratified in 1990.

The IFIP was intended as a state financial assistance program in which the DCED provides multi-year grants to eligible applicants. Grant recipients through this program sell bonds to finance qualifying “infrastructure and facilities” expenses, and then use grant funds from DCED to pay debt service on the IFIP bonds.

The IFIP statute was altered in July, 2004, with the amendment known as ‘Act 23.’

The principal author of the Act 23 amendment [12 Pa.C.S. §3406(b)(11)] was Sen. David Brightbill, a Lancaster County Republican.  Brightbill’s amendment added language allowing “convention centers” and “hotel establishments” to fall within the IFIP funding guidelines. (Brightbill went to work for the Stevens & Lee law firm after leaving the legislature in 2007.) Sen. Gibson Armstrong was also a co-sponsor of Act 23.

Through the program, and under Act 23, RACL planned to apply for one bond for $12 million – to be serviced by anticipated annual state grants predicated upon projected tax collections by the state generated directly and indirectly by the project over a 20-year period. Then RACL was to apply for a second bond of $24 million from conventional sources in the bond market.

The new arrangements meant Penn Square Partners would be reimbursing RACL for debt service payments on the $24 million conventional bond and pay no property taxes for 20 years. After 20 years, the Partners had the option of buying the hotel for a small fraction ($2.5 million) of the property’s likely appraised value at that time. The Partners purchased the Watt & Shand building for $1.25 million, and sold it to RACL for $6.8 million six years later.

If the Partners couldn’t make the debt payments on the $24 million bond issue, the City of Lancaster would be responsible for making the payments. The City also agreed to waive all applicable fees related to the hotel’s construction, including for building permits.   The fee waivers waived many hundreds of thousands of dollars for the Partners. The City also waived a Traffic Impact Study requirement for the project.

The project was now in the hands of the City of Lancaster, which was then led by fervent project supporter, Mayor Charlie Smithgall, and the Republican-dominated Lancaster City Council.

On April 12, 2005, after the City Council approved submitting the Act 23 bond application, the sponsors probably thought the money was as good as in the bank.

The city controller of a small city such as Lancaster has the role of overseeing the accounting and financial systems of the municipality. It is the role of an accountant. In the city of Lancaster, it is an elected position. Usually the Controller comes into office with the mayor of a city. It is a low profile, part-time position.

When Charlie Smithgall was first elected in 1997, his victory and re-election brought with him the entire Republican slate. The Controller on the ticket was a middle-aged, bearded, rather stiff, former West Virginian named Robert B. “RB” Campbell.

Campbell, with an accounting degree from West Virginia University, was a local commercial real estate broker when he was elected. The mayor and his controller had clashing personalities. The garrulous Smithgall, in 2005, was comfortable with the trappings of his office, and expected his agenda followed without questions. Campbell, an independent thinker with a brusque personal manner, bristled at Smithgall’s approach.

Before the school board TIF vote, the County’s special counsel, Howard Kelin, wrote a memorandum to the County Commissioners that questioned the eligibility of the project for the Act 23 funds. Campbell read the memo.

After the ‘miracle’ RACL rescue of the project was announced, it was taken as a formality that the Lancaster City Council would approve the Act 23 applications. And it was a formality. The Council voted 6-1 to apply for the $36 million in bond funds for the hotel. Luis Mendoza, a Republican, dissented and was the only “no” vote.   Mendoza explained that Council members had not been provided sufficient information, despite his many requests.

The next step in the Act 23 process, usually automatic, was for the City Controller to sign the application documents before they were mailed to the Department of Community and Economic Development, the agency that disburses Act 23 funds.

But a funny thing happened on the way to the post office…

When the Act 23 application papers arrived on RB Campbell’s desk, he refused to sign them until, he said, “I could have an independent legal counsel advise me on the legality of the application. Howard Kelin’s memo raised some serious questions about the eligibility for the Act 23 funds.”

Kelin’s analysis centered on Act 23’s language requiring the “project user” — in this case, Penn Square Partners’ “hotel establishment” — to “timely pay all local and Commonwealth taxes and fees.”

Campbell believed, after reading the Kelin memo, and thinking for himself, that his fiduciary duty called for him to be certain about the legality of the application. Smithgall was furious, and, without discussing the matter with Campbell, immediately sued his controller, asking the court under a Mandamus writ, to force him to sign the documents. A Mandamus writ is issued by a Superior court to compel a lower court or a government officer to perform mandatory or ministerial duties.

Here is the timeline of the events surrounding the Act 23 application:

• April 12, 2005: City council votes to apply for $36 million in Act 23 funding.
• April 20, 2005 Controller Campbell is presented with documents related to the financing of the Act 23 grants.
• April 22, 2005, Controller Campbell sends letter to Mayor Smithgall stating that he would not execute the documents in question until he had assurance of the legality of the application in the form of an independent review by counsel of the Controller’s choosing to investigate the issues raised by Kelin’s memorandum.
• April 22, 2005 the Mayor sues the Controller to compel him to sign the documents.
• April 25, 2005, the Controller is ordered to appear in common pleas court; judge entered a preliminary “Mandamus” order requiring the Controller to execute the documents and, in the alternative, allowing the Mayor to sign as attorney-in-fact.
• April 27, 2005 The April 25 court order made permanent
• May, 2005 Campbell files appeal with Pennsylvania Commonwealth Court
• September 14, 2005 Campbell loses appeal to Commonwealth Court. County files amicus brief on behalf of Campbell.

Campbell’s defeat did not discourage Commissioners Shellenberger and Henderson. Although Campbell lost, they would take up his cause and bring another lawsuit on the same Act 23 challenge.

The clamor and attention the project was now generating stirred another Lancaster citizen. This man would charge onto the now raging battlefield. He was only one person, but was an army of one.

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Chapter Sixteen: Robert Field: Lone Ranger

(Thirteenth in a series)

The rejection by the Lancaster School Board of Penn Square Partners’ TIF proposal was understandably disappointing to project sponsors. They were used to getting what they asked for from governmental bodies. And while the funereal words they chose after the vote were, at best, disingenuous, no one could argue the sponsors didn’t have a reason to be upset.

The defeat of the TIF plan, at least in this one instance, showed that the entire local establishment did not bow obediently to the demands of the private partners. The school board said ‘No’ to Penn Square Partners; and Dale High, and Jack Buckwalter, and Charlie Smithgall, and Gib Armstrong, and Mike Sturla et al were not used to anyone saying that to them, especially concerning their beloved project.

There would be harsh retribution for the insolence.

The Sunday News, like the two dailies owned by Lancaster Newspapers, was undisguised in its contempt for the school board after the March 15th vote.

On Easter Sunday, nearly two weeks after the TIF vote, as the sponsors were being quoted in all the Lancaster newspapers saying the project was “dead,” the still fuming Sunday News ran an editorial, “In the dark,” which began:

“Ironic, isn’t it, that during ‘Sunshine Week’ the School District of Lancaster board once again ran afoul of Pennsylvania’s open meetings law?

“It was more than a slap in the face to the public’s right to know, during a week set aside by national newspaper editors to raise awareness of that right, that board members and their solicitor were again making an end run around the Sunshine Act with a vote on Penn Square Partners’ request for a tax increment financing district for the proposed downtown hotel.

“Obviously, we think the board made a mistake in failing to approve the TIF district. We had been hopeful that a new deal negotiated by state Sen. Gib E. Armstrong and Rep. Mike Sturla would get a better reception, although the whole TIF deal may be dead now.

“But the company that publishes the Sunday News, Lancaster Newspapers Inc., is a limited partner in Penn Square Partners. So saying we’re disappointed in the board’s vote won’t exactly shock anyone.

“We are offended, though, by the orchestration of that vote in contradiction of the Sunshine Act.”

Members of the school board personally felt the sting of the sponsor Lancaster Newspapers.

“Some very venomous things have been said about this board,” said SDL president, Patrice Dixon, who was lobbied heavily leading up to the vote. Dixon voted ‘no’ on the PSP proposal.

“It was vengeful,” said former school board member, Mike Winterstein. “It really felt like we crossed the line with the ‘Mennonite Mafia.’ They were out to get us. We better watch out.”

If the sponsors’ reaction to the school board was severe, then the punishment that would be meted out to two of the three sitting Lancaster County Commissioners was absolutely brutal in comparison.

The sponsors of the hotel and convention center project had sound justification to be extremely concerned about the current board of Lancaster County Commissioners. During the campaign of 2003, all of the commissioner candidates, including the formidable Constitution Party Candidate, Jim Clymer, opposed the 2003 $40 million county bond guaranty.

Now, in early January, 2005, with Republican Dick Shellenberger replacing erratic and volatile Pete Shaub as chairman (Shaub remained on the board), the Commissioners were faced with the TIF issue.

Before the SDL vote on the TIF, Shellenberger and Democrat Molly Henderson had submitted “57 Questions” to Penn Square Partners, LCCCA, and RACL. The questions concerned the TIF and many other areas of financing and feasibility of the project, including potential tax payer risk, and the legality of the tax itself. The Commissioners were demanding answers to very difficult questions.

The unwillingness of Penn Square Partners to respond to the Commissioners’ questions raised serious concerns in Shellenberger and Henderson.

Shellenberger and Henderson were now looking at all aspects of the project. They, along with special counsel Howard Kelin, were examining the county guaranty, the tax itself, and the area of the tax. This was likely viewed as a serious threat to the project sponsors.

Furthermore, according to terms of the TIF the County, though it would receive the smallest slice of the property tax revenue from the project, had the authority to order an assessment of the former Watt & Shand property, including whether it was taxable, through the county’s assessor’s office.

Most critically, in September 2007, before the end of their terms, the county would name the pivotal ‘swing’ vote to the Lancaster County Convention Center Authority board of directors.

The last was a major concern of the sponsors.

Shellenberger and Henderson were a political odd couple. Shellenberger was from the most conservative wing of a conservative Lancaster County Republican Party. Raised in the Mennonite Church in Lancaster County, Shellenberger is a former farmer and restaurant owner, whose vivacious wife, Pam, had been a key member of the ‘kitchen cabinet’ of U.S. Representative Joe Pitts, another right-of-center Republican.

Henderson, the former head of Public Health for the city of Lancaster under Republican Smithgall, would be considered a ‘progressive’ Democrat. She was a strong supporter of Hillary Clinton’s Presidential bid. Henderson’s husband, Alex, is a powerful Lancaster attorney. (A former managing partner [currently senior partner] at a top-tier Lancaster law firm, Alex Henderson, a Republican committeeman, also chairs the executive board of directors of Lancaster General Hospital, as well as the Lancaster Area Sewer Authority.)

Coming from opposite ends of the political spectrum, Shellenberger and Henderson came to believe that the convention center project was poorly conceived, executed for benefit of lawyers and consultants, and designed to be dependent on endless taxpayer subsidization.

Both Commissioners were deeply concerned by the rising cost and expanding scope of the project, and the rubber-stamp spending of the LCCCA board, especially as it became apparent that no independent feasibility study had been performed, contrary to the promoters’ claims.

On the issue of the convention center, Chairman Shellenberger split party ranks with Shaub (a rarity in GOP dominated Lancaster County), as well as the City’s Republican Mayor Smithgall and powerful State Senator Armstrong.

Henderson broke party ranks on the convention center with the only elected Democratic State Representative from Lancaster County, Mike Sturla.  Sturla and Armstrong were close allies on the convention center project.

Shellenberger and Henderson started taking measures at the county level to see that the project was not railroaded without check.

“I had to understand how it was going to affect the taxpayers,” said Shellenberger. “And until I got answers to those questions – and I wanted public input, too – I wasn’t going to just vote for it because they [the sponsors] wanted me to.”

Perhaps the first shots in what would become a multi-year battle by the Lancaster Newspapers against Shellenberger and Henderson were targeted primarily at Commissioner Henderson. On the 23^rd of March, 2005, on the front page of the Intelligencer Journal was an article, “Shaub attacks Henderson over center: Accuses her of sabotage,” which begins:

“Lancaster County Commissioner Pete Shaub on Tuesday accused fellow Commissioner Molly Henderson of ’sabotage’ in ‘trying to kill’ the downtown convention center/hotel project.

“‘Commissioner Henderson has repeatedly put up roadblocks to try to kill this project,’ Shaub said. ‘As soon as she heard that (state) Sen. (Gibson E.) Armstrong and (state) Rep. (Mike) Sturla are having an opportunity to form a compromise and let this city accomplish its vision, she wants to kill the project.’”

The second shot appeared on April 3^rd, one week after the ‘miraculous’ resurrection of the project. In another lengthy front page story, the Sunday News (“Good Golly, Molly: Henderson’s questions on downtown project rile her friends in both parties”) takes direct aim at the two commissioners who were raising questions about the project.

“In a convoluted saga that has been full of strange twists, the weird factor is off the charts in seeing Henderson and Republican Dick Shellenberger as the last remaining roadblocks to the convention center, while Shaub is its fiercest defender.”

This was just the beginning of the undeclared (but very real) war of words by Lancaster Newspapers against Shellenberger and Henderson. The fallout from the Commissioners’ alliance on the convention center issue was swift and not to be anticipated, and literally defines a period of Lancaster County history.

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Chapter Fourteen: Citizens Brigade: Opposition gets reinforcements