LETTER: $20 million is but the beginning of County “guarantee”

“Yes, Lancaster County is only liable for $20 million of the $64 million in [Convention Center] construction bonds. But that does not tell the whole story.

“If ‘hotel [room sales] tax’ proceeds fall short of the amount needed to make construction bond payments, Lancaster County government is liable to make up the difference. About the only way that would happen is if hotel occupancy would collapse to about half of its current level; since ‘hotel tax’ collections have only slipped a few percentage points during the worst recession in decades, that is not likely to happen.

“*But what about the OPERATION of the convention center?* This is the issue that Craig Lehman has failed to address.

“It is obvious that the operational budget for the convention center is woefully inadequate. It is already clear that the convention center will need to generate more revenue than anticipated by the “pro-forma” estimates to make ends meet. This will be difficult, especially since utilization of the LCCCA’s spaces is booked at not much more than half of pre-opening estimates. And no major trade shows have been booked beyond the spring of 2010.

“Note that the LCCCA does NOT have any taxing authority; only the County Commissioners can raise taxes. Yes, the LCCCA can legally take the share of the ‘hotel tax’ that currently goes to the Pennsylvania Dutch Convention and Visitors Bureau. But would the County Commissioners willingly let the PDCVB lose such a large part of its funding? Especially since the ‘hotel tax’ funds the three full-time PDCVB employees whose job it is to promote the hotel and convention center.

“What will happen when the convention center needs additional funds to pay for its unanticipated operational losses? Would the County Commissioners really allow the convention center to close when it runs out of money?

“*Of course not.*

“Craig Lehman’s promises will quickly be forgotten, ignored, or rationalized when the LCCCA eventually is forced to come begging for more money.

“I challenge anyone to ask Craig Lehman exactly what he will do when the LCCCA needs additional operating subsidies. It will be interesting to see what kind of spin he puts on that answer.”