Wednesday, March 26, 2008

EDITORIAL: Rick Gray's Mythical $20 million; Art Morris's forgotten two million

In August of 2006, Mayor Rick Gray gave an interview to WGAL-TV in which he proclaimed "What we have done is close the funding gap" of $20 million. The "gap" had caused Penn Square Partners to announce that the convention center project was being aborted.

The interview is well worth watching.

Because most of the $20 million in so called savings turned out to be illusionary, the gap actually increased. Furthermore Gray projects $2 million in naming rights, which may have been a low estimate.

Gray claimed there would be $5.2 million "from negotiations with contractors," but building costs actually went up.

Gray also indicated there would be $3 million in easement payments from the impecunious Historic Preservation Trust, which the Trust promptly denied.

Gray said there would be $7 million in savings for the parking garage, but the cost of the parking garage ended up being paid by the public and users rather than the Partners.

What is LCCCA Chair Art Morris thinking about when he questions whether there will be naming rights proceeds, especially given the more than $2 million being charged for naming rights in comparable other locations?

And why is Morris proposing to go hat-in-hand to seek "clarification" from Penn Square Partners when it is obvious that Penn Square Partners misled Gray about the gap being closed?

Penn Square Partners obtained one-sided clauses that mysteriously appeared in its contracts with the Authority, inappropriately diverting millions of dollars of taxpayer money to the hotel developer.

Morris should leave his hat at home and bring a bludgeon for a real negotiation.