The Lancaster County Commissioners are hoping for better luck the second time out in their case against a downtown convention center.
Attorneys for Commissioners Dick Shellenberger and Molly Henderson this week filed a 53-page brief in their appeal of a county court ruling against them.
They are asking the state's Commonwealth Court to overturn Judge Joseph Madenspacher's October ruling.
Madenspacher granted a permanent injunction sought by the Lancaster County Convention Center Authority, the city Redevelopment Authority and Penn Square Partners to prevent the commissioners from enacting a pair of resolutions that would have eliminated the center's financing.
The Convention Center Authority is building the 220,000-square-foot meeting center in the first block of South Queen Street. The private-sector Penn Square Partners is developing a 300-room Marriott hotel adjacent to the center, on the site of the former Watt & Shand department store. The hotel is being constructed behind the preserved store facade. The city Redevelopment Authority owns the former store site.
The total cost of the project is about $170 million, including $36.3 million in private funds. The rest of the funding is coming from public sources.
At issue in the case is county backing of half of a $40 million construction bond. The county guaranty was approved by a previous board of commissioners - who supported the project - in 2003.
The current commissioners maintained in testimony in September the guaranty is invalid. They contend in their appeal that Madenspacher erred in upholding the agreement.
Madenspacher, county attorney Howard Kelin contended this morning, failed to rule on whether it was proper for the outgoing commissioners board to approve the financing.
The construction money was not needed at the time and the issue was not left to the incoming commissioners, the county filing contends. All the candidates for commissioner at that time said they did not approve of taxpayer risk in the project.
Because, Madenspacher ruled, a private entity could have guaranteed the financing, it was not necessarily a governmental function. As such, he did not have to rule on whether the guaranty was "fake financing."
Kelin argued this morning that Madenspacher's ruling ignored testimony that the financing guarantee had to come from a government with taxing powers to qualify for a state grant.
"If it is has to be a government guarantee, then it has to be a governmental function," Kelin said.
"From the appellate standpoint, we're confident the court will uphold Judge Madenspacher's ruling," said John Fenningham, a Convention Center Authority attorney, this morning.
Lancaster Mayor Rick Gray, who is also an attorney, said the commissioners must prove Madenspacher's ruling was unreasonable. That will be a hard burden to meet, said Gray, a center supporter.
"On a policy basis, it would be very difficult for the Commonwealth Court to overrule a local judge. ... Commonwealth Court is bound by Judge Madenspacher's findings of fact," said Gray.
Neither Shellenberger nor Henderson returned calls for comment before the press deadline this morning.
David Hixson, the Convention Center Authority's executive director, would not comment on the ongoing litigation. He deferred all comment to Fenningham.
Fenningham said the authorities and Penn Square Partners will have 30 days to file their legal briefs in response to the commissioners.
It will then be up to the Commonwealth Court judges to determine whether they will rule based on the briefs or hear oral arguments at a hearing. There is no timetable for that decision, Fenningham said.
Penn Square Partners consists of general partner Penn Square General Corp., a High Industries affiliate, and limited partners Fulton Bank and Penn Square Ltd., LLC, an affiliate of Lancaster Newspapers, Inc., publisher of the Lancaster New Era, Intelligencer Journal and Sunday News.
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