The problem is, the need for additional money to subsidize the convention center is unavoidable. Even an increase in hotel room occupancy to 2007 levels would not bring in the more than $300,000 in “hotel tax” which will be necessary to keep the convention center in operation; even that figure is only a preliminary estimate, the actual number could be much higher.
Significantly reducing that amount is impossible; even Mark Moosic of IHR admitted the most they will be able to cut out of the budget would be 2% to 3%.
Part of the problem is the design of the “integrated facility” (to use IHR’s terminology) prevents an immense volume of open space from being physically isolated from the hotel lobby. This means that even if the convention center itself (but not the hotel) would be mothballed, the LCCCA (meaning us taxpayers) would still be liable for huge utility bills for the areas wide open to the hotel lobby.
I expect that the County Commissioners will make up some kind of reasonable-sounding excuse, and pass an increase in the hotel tax before the end of 2010, because the alternatives could be far more unpleasant. The only real question will be just how much further this will hurt the image of the project in the eyes of the public.
Don’t forget that the Penn Square Partners are also facing utility bills far higher than anticipated. How will they deal with it? Based on past experience, they just might ask for more from Lancaster City taxpayers.(Perhaps this is why Lancaster Newspapers clearly favored Smithgall for mayor in the recent election.)…
The sad saga of the taxpayer-financed hotel and convention center project has just begun. What is yet to come could very well make what has already happened seem pale in comparison.
