NewsLanc.Com

    Providing Greater Lancaster with an Alternative Source for Local News and Commentary  _________________________________________________________
  September 26, 2006                   NewsLanc.Com, LLC, Publisher                 Volume 1, Number 7
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Edward G. Rendell, Governor
225 Main Capitol Building
Harrisburg PA 17120
(717) 787-2500
E-mail the Governor here.

Gibson Armstrong, State Senator
(717) 787-6535
garmstrong@pasen.gov

Mike Sturla, State Representative
(717) 295-3157
msturla@pahouse.net

J. Richard Gray, Mayor, City of Lancaster
(717) 291-4701
mayorsoffice@cityoflancasterpa.com

Ernest Schreiber, Editor
Lancaster New Era
eschreiber@lnpnews.com
(717) 291-8733

C. Ray Shaw, Editor
Intelligencer Journal
rshaw@lnpnews.com
(717) 291-8650

Marvin Adams, Editor
Sunday News
madams@lnpnews.com
(717) 291-8788

Lancaster Newspapers 'Doublespeak'
Sunday News' Deceptive "Museum Picks Up Steam" Rivals
Intell's "Center Closes Fund Gap"

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Sunday News said: "Museum Picks Up Steam" - Sept. 24, 2006
They Should Have Said: "Sponsors Renege on Demolition Promise."

Sunday News said: "We are satisfied that the provisions we put forth in the agreement have been met," quoting Rita Byrne, Board President of the Historic Preservation Trust.
They Should Have Said: "The Trust relinquished its right to require the securing of final governmental approvals and adequate funding before demolition takes place."

Sunday News said: "In August, Mayor Rick Gray announced developers and officials had come up with money to meet the budget overruns..."
They Should Have Said: "In August, Mayor Rick Gray announced that the sponsors and officials had come up WITH A PLAN to meet the [$20 million] budget overruns...."

Intell said: "Center Closes Fund Gap" - Aug. 11, 2006
They Should Have Said: "Sponsors HOPE to close fund gap, but haven't identified how."

Intell said: "There is a $20 million funding gap" - Sept. 24, 2006
They Should Have Said: "There is a $28 million funding gap because we left out the standard allowance for contingencies."

NewsLanc.Com says: If Lancaster Newspapers was not a monopoly with a 44 percent ownership interest in the project, the Sunday News would report: "The Convention Center/Hotel sponsors have found perhaps $2.5 million toward a remaining $25.5 million deficit. Nevertheless, demolition will proceed."

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Convention Center / Hotel Project RISK per Household.
$3,930 for Lancaster City; $840 for Non-City Household*

Commissioners Shellenberger and Henderson are concerned that in the future the City
and the LCCCA will request tax increases to cover deficits.


CITY GUARANTEES HOTEL
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City mortgage guarantee: $24,000,000, average 20 years.
Principal borrowed: $24,000,000.00    Term: 20 years   Annual interest rate: 5.00%
Total Principal and Interest Paid:                                 $31,677,840

City School tax guarantee:  $800,000 x 20 years =      $16,000,000

(2% of $40,000,000 hotel assessment)

City Tax Increment Financing (TIF) guarantee
       for 17 of the 20 years:                                              $17,000,000

   $64,677,840


$64,677,840 / 20,933 households = $3,090 risk per City household.


COUNTY / LCCCA GUARANTEES – CONVENTION CENTER
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County has guaranteed $20,000,000 of a $40,000,000 bank loan to be converted into tax free bonds.
LCCCA guarantees the other $20,000,000. Since LCCCA is not a taxing authority, risk will be greater than if fully guaranteed by county.

Principal borrowed: $40,000,000.00   Term: 40 years   Annual interest rate: 6.00%  

Total Principal and Interest Repaid:                  $105,641,040


LCCCA is likely to borrow an additional $14 million to help close construction cost gap.

Principal borrowed: $14,000,000   Term:  40 years    Total Annual interest rate: 6.50%

Total Principal and Interest Paid:                               $39,342,696
                                                              $144,983,736

$144,983,736 / 172,560 households =   $840 risk per County household

$3,090 City + $840 County = $3,930 per City household


* These calculations are based upon market conditions. Interest rates and amounts borrowed may vary.