Council to debate bills on city convention hotel

Decision moves funding legislation out of committee, into full panel

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April 17, 2005|By Eric Siegel | Eric Siegel,SUN STAFF

The first pair of a package of bills needed to create a publicly financed and owned convention headquarters hotel is scheduled to be introduced tomorrow before the Baltimore City Council - accompanied by the first whiff of political controversy over the project.

Council President Sheila Dixon says she will refer the bills to the entire council sitting as a Committee of the Whole rather than an individual committee, as a way to involve all of the members in the process - and that she likely will lead the hearings herself.

That decision rankles Councilman Keiffer J. Mitchell Jr., who opposes complete public funding of the project. As chairman of the council's taxation and finance committee, he typically would have jurisdiction over legislation needed for the financial aspects of the hotel deal.

Mitchell portrayed the move as an end-run around his committee and an attempt to meet an ambitious schedule that calls for construction to begin by the end of the year for the $305 million, 752-room hotel to be operated by Hilton Hotels Corp. City officials say the hotel is needed to boost business at the Baltimore Convention Center.

"They don't want any bumps in the road in this process," he said, pointing out that two other members of his five-person committee also have raised concerns about the financing of the project.

The 11th District Democrat plans to introduce legislation of his own tomorrow to create an independent advisory panel to review all three proposals originally submitted to the Baltimore Development Corp., the city's economic development agency.

"The city should not be in the business of owning a hotel," Mitchell said, reiterating a position he has been expressing since February. "We have a hard enough time trying to manage our housing stock and our school system. This is one more headache we don't need."

But Dixon, who has been strongly supportive of most of the initiatives of the administration of Mayor Martin O'Malley, said her decision on how to conduct the hearings on the hotel bills has nothing to do with Mitchell's stance on the project.

"This is not an end-run," Dixon said. "This is not about politics. It's about having the entire council in this process. This is a huge item. I want inclusive input from everyone."

One of the bills to be introduced tomorrow would set up a special development district to allow property taxes to be used for the project.

Another would authorize the city to issue $305 million in revenue bonds for the hotel and would create a nonprofit corporation to own the hotel.

Additional legislation will be needed to close certain streets and to amend the urban renewal plan that covers the empty parcel next to the convention center on which the hotel would be built.

One of the most contentious aspects of the project is the city's plan to pledge citywide hotel taxes on top of the headquarters hotel revenue to cover the debt service on the bonds - a pledge officials say was necessary to get a favorable bond rating but is unlikely to be needed.

Dixon - who says many of her initial reservations have been allayed but that she's still not "totally convinced" about the plan - said she would not schedule a hearing until all the necessary legislation was introduced.

Dixon was among several council members to attend a lengthy briefing on the project Monday at the Baltimore Development Corp.

The agency contends that the hotel cannot be built without publicly issued, tax-exempt bonds that carry a much lower interest rate than private financing.

"We've heard all the council member's concerns. We're trying to address them," said M.J. "Jay" Brodie, president of the BDC. "We're optimistic that there's a growing understanding of the project. It's not a simple thing."

Although Brodie said he understood the need for careful deliberations, he said he hoped the council would approve the package of bills in time for the bonds to be issued in the fall, with construction to start by the end of the year and be completed by spring of 2008.

"The bond market is not likely to go down, it's likely to go up," he said.

"The convention center is not helped by delay," he added. "This is a highly competitive business."

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