Conferees agree on Convention Center Ownership issue resolved

voting set for tomorrow

April 11, 1993|By William F. Zorzi Jr. | William F. Zorzi Jr.,Staff Writer

After a long day of negotiating, key state lawmakers struck compromise last night that paves the way for construction of the $150 million expansion of the Baltimore Convention Center.

House and Senate conferees overcame their biggest stumbling block by agreeing to finance the state's $100 million share of the project with a combination of revenue and general obligation bonds.

They also settled on ownership provisions acceptable to Mayor Kurt L. Schmoke, who had threatened to withhold the city's $50 million share unless there was a limit on how long the state would have a stake in the building.

Under the plan, the state would have a half-ownership interest in both the old center and the proposed expansion until the bonds are paid off in 21 years. That is similar to the original House language favored by Mr. Schmoke.

The conference committee report will go to the floor of the House of Delegates tomorrow morning and, if approved, on to the Senate. Legislative leaders said they were cautiously optimistic the deal will be approved.

But, coming on the final day of the legislative session, which ends at midnight tomorrow, the measure's passage was by no means guaranteed.

"My biggest concern . . . is that we're going back on the last day, and when you do that, you run the risk of a filibuster," said Sen. John A. Cade, an Anne Arundel Republican, who had fought hard for greater state control over the center.

Breaking the deadlock on the Convention Center last night allowed the conferees to finally take up the capital budget, which had been in limbo pending resolution of the expansion issue.

Senators and delegates were pleased with the outcome of the at times uphill battle they had waged to save the Convention Center bill this year. The measure got off to a dubious start because of a rift between Baltimore legislators and lawmakers from Montgomery and Prince George's counties over last year's budget cuts.

Gov. William Donald Schaefer's approval of an $82 million Performing Arts Center at the University of Maryland at College Park was considered crucial in securing the support of Prince George's legislators.

The Convention Center expansion was critical, administration officials argued, because business has declined as a growing number of conventions required more space than the 115,000-square-feet building.

Without the expansion, they said, that decline would continue.

The administration also said that the tax revenues generated by the additional convention business would more than pay for the project, giving the state's bottom line a boost.

Mayor Schmoke was in Baltimore and could not be reached for comment on the compromise last night. But Sen. Barbara A. Hoffman, a Baltimore Democrat who sat on the conference committee, said that she had been in contact with the mayor earlier in the day and that the arrangement for ownership was acceptable to him.

"If it were any other project, it would have died," Senator Hoffman said. "We've walked away from the table for less. . . . But it would've been a tragedy if it had gone down."

The conferees agreed that at times yesterday, the project -- a top priority in the governor's legislative package -- came dangerously close to dying in conference.

But David S. Iannucci, the governor's chief lobbyist, said that he never believed the project was in trouble because of the commitment of the legislators to making the expansion a reality this year. "I constantly saw a willingness to come back and talk out the areas of disagreement," Mr. Iannucci said.

Mr. Schaefer, who met privately with Senate and House conferees yesterday in an effort to facilitate the compromise, had similar words of praise for the legislators.

The Senate version of the bill had provided for the state to be a 60-percent owner of the original 14-year-old building, an earlier expansion and the proposed expansion for 99 years -- with the option to extend that forever.

Senator Cade had insisted on that language after raising concerns over the city's ability to maintain the existing building -- concerns which reportedly infuriated Mr. Schmoke and prompted his threat.

Under the compromise, construction of the state's portion of the project would be paid for in three steps: the sale of $20 million in 15-year general obligation bonds this year; the sale of $51 million in 20-year revenue bonds next year; and the sale of $30 million in 15-year general obligation bonds in 1995.

The original House proposal called for using revenue bonds to finance the entire package, which would have cost taxpayers, over 20 years, from $45 million to $63 million more than the Senate's plan to finance the expansion with money raised by general obligation bonds.

The use of revenue bonds in the compromise -- which calls for a 50-50 split on the type of bonds sold -- would cost about $17 million more than an all-general obligation bond financing plan.

The proposal requires the city to sell bonds for its $50 million share of the project the same year the state sells its revenue bonds.

The conferees also are requiring that the city and state put the legal work related to bond sales out to competitive bid -- a practice not currently employed by the city.

While the conferees would not say so last night, that action was clearly a swipe at Mr. Schmoke's frequent use of Shapiro and Olander as bond counsel.

The law firm's named partners include Ronald M. Shapiro, campaign treasurer and key fund-raiser for the mayor. Another lawyer affiliated with the firm is Larry S. Gibson, the mayor's political godfather and longtime campaign manager.

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