GlobeSt.com UPDATE: Support for $632M Convention Center Expansion is 'No Blank Check'

While stressing that Gov. Ed Rendell "is absolutely, unambiguously and enthusiastically committed to the expansion" and is "determined to get this project under way now," Masch also says the governor "is not going to write a blank check for a $632-million, state-funded project." He called the project "the most expensive capital project ever undertaken by the state."

The state passed a budget bill to provide $400 million in funding, and City Councilman Michael Nutter tells GlobeSt.com, "the expectation is that the state will pay a significant amount of the cost," primarily from gaming revenues under details that have not yet been worked out. The first state requirement is a plan in place, Masch says, "that lays out how the expanded center is going to operate and be funded" once it is complete. The governor also calls for "the strongest possible controls…to ensure that this project will come in on time and on budget."

In getting ready to draft agreements to deliver the first $16-million portion of state funding, Masch says, state officials discovered that all procedures for assuring that the project would not be subject to cost overruns were not in place and that certain analyses regarding the cost to operate the expanded center had not yet been carried out. He specifically cited the question of whether a "taxpayer subsidy is going to be required to cover operating deficits at the expanded center."

He notes that the state was not insisting that all of the "undone work" be completed before it proceeds, but is insisting "all parties to this project must commit themselves to a specific timetable to get this work done as quickly as possible. Our requests are not frivolous. We have no desire to make anyone jump through hoops."

Nutter says of the criticism, "it's a bit of a chicken-and-egg situation. It's hard to create an elaborate business plan until it's clear there will be funding for the project. While we appreciate the commonwealth's frustration in not getting the information it needs, similarly we're frustrated in not having the money. We need a contract between the Convention Center Authority and the Commonwealth in order for funds to be released. It's a complicated contractual agreement." Nevertheless, Nutter says, "we're partners in this, and we are very close to meeting the state's requirements." He expects "it will be wrapped up within a week to 10 days."

The initial $16 million is to pay for design and construction documents and "pay bills the center has paid related to construction activities," Nutter says. The Philadelphia Redevelopment Authority, which is assigned to assemble and acquire land for the expansion, works under its own contract with the state to obtain the funds it needs, according to Nutter. Calls to the Redevelopment Authority and to Al Mezzaroba, CEO of the Convention Center Authority, were not returned by deadline.