The Pennsylvania Dutch Convention & Visitors Bureau voted today to back out of a multi-party financing plan for the Lancaster County Convention Center, according to PDCVB President Kathleen Frankford.
The move comes after Penn Square Partners declined to sign onto the plan. Lancaster County Commissioner Scott F. Martin, who has been leading negotiations on the plan for about two years, initially said he would not proceed without all parties but then last week announced that, in extremity, he would move forward without PSP.
Frankford's statement on the PDCVB decision is as follows.
"Pursuant to Commissioner Martin’s announcement on June 18, the board of the PA Dutch CVB voted today not to support the latest version of the Collaboration Agreement designed to resolve the immediate financial challenges facing the Lancaster County Convention Center Authority (LCCCA).
"The support of the bureau has always been based on an agreement that shares the contributions needed for the LCCCA’s financial stability among all stakeholders.
"This crucial aspect is now absent from the current proposal.
"Thus, as currently drafted, the Collaboration Agreement will have to proceed without our support."
Comment from Martin was not immediately available. When announcing his decision on PSP on June 18, he said if the other parties ratified the agreement without PSP in it, he planned to put it to his fellow commissioners for a vote during their meeting at 10 a.m. July 1, the last day possible under the current arrangement with bondholder Wells Fargo.
If no agreement is reached and the debt goes into default at 5 p.m. July 1, Martin said then, the default interest rate on the nearly $64 million in bonds would be 10 percent, meaning that the annual payment would be more than $6 million.
The hotel tax didn't raise that much money even during a good spell last year, he said, and so through its existing partial guarantee on the bond, the county would have been on the hook for at least $1.3 million a year.