ANNAPOLIS — It could become more acrimonious in Annapolis soon — at least as far as Frederick County lawmakers are concerned.

The hiatus in the debate over funding for a downtown Frederick hotel and conference center has come to an end after the Senate Budget and Taxation Committee voted to recommend $16 million in state bond funding for the project.

With little debate, the committee approved a slew of changes to the capital budget Wednesday afternoon.

The move comes after the House Appropriations Committee agreed with Republican Gov. Larry Hogan in striking the General Assembly’s prior authorizations for project funding earlier this session.

When Hogan’s fiscal 2018 budget was unveiled in January, it removed a previous authorization of a $1 million grant for design and planning related to the proposed downtown hotel and conference center. The governor’s capital budget bill also removed $15 million in preauthorizations for bond funding in 2018 and 2019 that the General Assembly passed last year to support the project.

With the Senate committee’s actions Wednesday, the structure of the funding was changed, but still adds up to the $16 million approved or reauthorized by the General Assembly in 2016.

The committee’s version of the capital budget is expected to go before the full Senate later this week.

As amended, the 2018 capital budget would include a $1 million grant for planning and design for the downtown hotel and conference center project, while also removing language that made the funding contingent on a memorandum of understanding signed by the Maryland Stadium Authority, county executive and County Council, Frederick’s mayor and Board of Aldermen, and the private developer of the property.

Last year, the Maryland Stadium Authority and then the Maryland Economic Development Corp. voted not to get involved with the project as it was structured at the time.

Other amendments to funding for the project include adding $4 million in bond appropriation in fiscal 2018, a $7.5 million pre-authorization for the 2019 fiscal year and a $3.5 million pre-authorization for the 2020 fiscal year.

Sen. Ron Young, D-District 3, who supports the project, said he was pleased that the committee was moving forward with funding.

“I expected it, but until it happens, you’re still surprised,” Young said. “I’m sure there will still be a little bit of a battle over it.”

Republican members of Frederick County’s General Assembly delegation have opposed state funding for the project over the past two years.

Sen. Michael Hough, R-District 4, said he was told earlier in the week the funding would not be recommended. “This is nothing more than a backroom deal to pay back Frederick Democrats for their partisan votes to raise taxes and overturn Governor Hogan’s vetoes,” Hough said in a written statement. “It’s a big fat taxpayer gift to their re-election campaigns.”

Lobbyist Bruce Bereano represents Randy Cohen, owner of the Clarion Inn Frederick Event Center, and Brad Kline, developer of a proposed hotel and conference center at Jefferson Tech Park. Bereano said he will continue to lobby against the project, which he says pits private businesses against unfair government competition.

“This matter is not over,” Bereano said. “…Don’t book your room yet.”

The capital and operating budgets move separately through the House of Delegates and Senate. The House passed a version of the budget first this year, and is being followed by the Senate.

Differences between the two versions of the budget will be ironed out by a conference committee of five senators and five delegates.

It was a conference committee that added the bond funding for the conference center project in an end-of-session amendment last year.

The General Assembly’s informal deadline for a final budget is April 3.

Once passed, the governor has line-item veto authority when it comes to capital budget appropriations.

If bills are passed by both chambers early enough in the session — with at least six days remaining — the House and Senate could immediately override any veto by the governor.

The proposed hotel and conference center property at 200 and 212 E. Patrick St. is owned by a business entity formed by members of the Randall family. The Randall family also owns the parent company of The Frederick News-Post.

Plans for the 207-room Marriott and 24,000-square-foot conference center are based on a combination of public and private dollars. Plamondon Hospitality Partners is expected to pay $53 million for the hotel portion of the project.

Follow Danielle E. Gaines on Twitter: @danielleegaines​.

Danielle E. Gaines covers politics and government in Frederick County, splitting her time between Winchester Hall and The State House. Having grown up in Illinois, she lived in New York and California before settling in Maryland.

(58) comments

threecents

For Hough to say, "It’s a big fat taxpayer gift to their re-election campaigns” is not helping his cause. That is too much. Unless he has proof, an elected official should not go there. And Ron already announced he is retiring after this term, though maybe his wife will try to get re-elected.

elymus43

It would be nice to see the money trail on the hotel in Annapolis??????

joelp77440

The hotel is supported by most people but the craziest thing is those who don't support it or like passionately against it. I mean crazy passion. This was discussed several months ago at my NAC and two people almost came to blows. One calling the hotel the "devils work." Weird

threecents

Joel, I agree with you. Even though I am against state and county and city funding for this, I see it is likely a good investment.

gary4books

Just think of the bed bugs it will bring in to Frederick. Horrible.

petersamuel

The News-Post should be ashamed of its stupid and slanted reporting. The headline is absurd. The hotel gets no money from a single sub-committee vote to recommend. Money is only gotten when both houses of the General Assembly vote the money and the Governor signs off.

KellyAlzan

So, this isn't approved?

DickD

Thank you, Peter.[thumbup]

threecents

If I read it right, the article says that this was just a senate committee that voted to recommend the money be included in the budget, so the title of the article seems wrong.

bicep42

The taxpayers who are expected to fund a large part of this monstrosity aren't being consulted or considered in this disgraceful display of corporate welfare.

KellyAlzan

You're right. Nailed it.

This is something our current president would try to do.

gary4books

When one has to lie about a deal to kill it, they should lose.

petersamuel

Pathetic, this will never be built, not for lack of money but for the sheer ineptitude of the City's management of the project, which chose an absurd site for such a huge complex -- too small, two historic buildings, archeological treasure trove, possible hazmat contamination, unknown traffic and parking impacts etc etc. Consultant after consultant is employed to no purpose. Time for the Mayor and board to face the fact: this contraption will not fly.

KellyAlzan

Contamination issue is MOOT. I really wish everyone would stop bringing it up. It's not the first piece of land to possibly be contaminated. Move on from that. Moot.

jthompson

Few things are more outrageous and hypocritical than for our elected officials to publicly lament the lack of state money for school construction and highway improvements while privately encouraging the state government to confer economic development benefits on private business entities.

Burgessdr

Guess you learned nothing as a elected official. You got it all backwards. Private business entities are the ones that generate economic benefits. Elected officials dont generate economic benefits. Private businesses entities create jobs. They employ people. They sell goods or services. Their employees pay income tax, they pay property tax, there is sales tax on the goods sold. Why are you so opposed to businesses that create jobs and generate economic benefit to the city, county, and state? Why are you opposed to a business entity that likely will generate 200-300 jobs $2-$3 million in tax revenue? You just dont get it.

KellyAlzan

Burg - why are you always telling EVERYONE They know nothing? I seen u do that on The Facebook,
too. And you don't even LIVE IN MARYLAND

KellyAlzan

And burg-

I assure you, I assure you.....everyone understands that tax revenue and jobs created (at a whopping $14 / hr). Everyone.

What YOU don't get Burg, is there is NO reason this can not be done entirely with private money. No reason.

And then, the state can use the $16 mil (+) for schools and roads and police and fire and rescue.

Route 66 in VA has a widening project underway. Funded entirely by private funds. Entirely. Private funds.

And burg, tell us why the hotel in harpers ferry is slated to happen entirely with private money??

petersamuel

J Thompson is quite right. Government needs to give priority to what government can do. Take no notice of a person who takes seriously the propaganda that this project will support 300 new jobs. It is in fact inhibiting economically viable job creation since potential investors in self-financing lodging wonder how they can compete with a government sponsored project calling for tens of millions of $s of taxpayer support.

jthompson

There are those who advocate for the replacement of our system of entrepreneurial capitalism (where investors risk their own money, guided by the invisible hand of the marketplace) with the government (where politicians risk the taxpayers' money, guided by the equally invisible hand of lobbyists, political action committees & campaign finance activities) as the preferable means of financing private business entities. While they certainly have the right advocate for their position, I disagree with them.

DickD

So, Young can get money for his buddies, Randall and Plamomdon, but not for schools. Do we really need Young?

KellyAlzan

This is unbelievable.

Young and company know darn well that the people do not support state money being used for this. darn well. Its very piggy. Its selfish. Its wrong.

Titanman123

Isn't this the corporate welfare Bernie/warren preach against? Why should the government pay money to a very wealthy developer? Please explain...

francesca_easa

Why can't they build this stupid hotel on Fredericktowne Mall or former Bechtel site? Can't the historic area stay historic? There goes the charm of downtown Frederick.

nbouqu1

[thumbup]

Dwasserba

"The senate subcommittee members’ microphones were not turned on during discussion of the project — and other decisions — during Tuesday’s meeting." Well that's convenient.

gary4books

I expect with tasting rooms and visitors we will need a good hotel for people to wait for the next day to drive home. Lots of complaints expected here. But when the hotel is built many will appreciate it.

MAVRICKinc7

Haven't we concluded long ago you are and have always been the "company-man?" What "will be" has yet to be decided. With the sale of the Frederick News Post, who's going to be negotiating this deal, that hasn't otherwise been made from behind closed doors and before this latest strategy to take Frederick and its citizen polulation to the cleaners, once AGAIN?

gary4books

Spring is a time for joy. So I enjoy good news. We have already decided I was a "Company Man" in the foreign services. That is old news and far in my past. Have a day!

shiftless88

No one is really disputing the hotel. The issue is the attached convention center that uses public funding.

stevemckay

Exactly! And when someone makes this point, and then asks where is the argument in favor of tax-payer funding?? Answer - there isn't one, there's just crickets.

gary4books

Some eyes are wide shut. The discussion has covered these points. I am happy with the process.

KellyAlzan

Gar - perhaps you're happy because your eyes are wide shut?😑

Titanman123

What no one appreciates is the flyers you put on my wife's car at the Marc station! Knock it off!

DickD

No doubt Frederick has it's share of drunks, Gary, but do you think they are going to be drunk enough to pay $150/night vs. getting a taxi for $20?

rbtdt5

150/night isn't bad and yes, people will pay for location. are you against the golf course and citizens?

KellyAlzan

[thumbup][thumbup][thumbup]

gary4books

Got to wait and see. But not restricted to drunks. Just the cautions and ones who want a leisurely breakfast the next morning.

KellyAlzan

dude, the stating room has been here for eons. no, its not creating a demand for hotel rentals

rcjones66

@gary....I live downtown and I'm one that will appreciate it. I've met a lot of folks visiting on weekends, First Saturdays, In the Streets, etc. that love the walkability of DTF and would like to stay all weekend and shop and eat, but can't unless they drive/cab/Uber out of the immediate downtown area. I'm not convinced we need the Conference Center part, but definitely the Hotel & parking deck..

gary4books

Finally - someone who actually lives downtown. Good points.

nbouqu1

I ran $16M through a mortgage calculator. With an assessed value of say $100M, no insurance costs, no taxes. A 40 year term and an interest rate of 3.25% you get a monthly payment of $59,606. That's per MONTH. Annually that would be $715,272. Now the last MOU we saw had Plamondon paying only $80K per YEAR in rent. So, before we add in the other $15M in public financing, that's $635,272 in annual finance costs to the taxpayers of Maryland.

And we haven't even calculated the extra costs to the city and county for this project such as increased police presence in the area, water and sewer, roads, etc.

nbouqu1

Oh and it gets worse....

According to the Maryland Treasurer's Office, MD bonds mature after 15 years and have an interest rate of 5%. See http://www.treasurer.state.md.us/debtmanagement/faq-on-bonds.aspx

So, for JUST this $16M, that's $126,526 a month. Or $1,518,312 a year. Again, against $80K in annual rent. And we still have another $15M in finance costs to add in and all sorts of other costs that will be incurred by the City, County and State related to this project.

Burgessdr

Your knowledge of economics is pretty limited. You apparently are unaware of the simple concept of revenue. One must look at the entire picture. Net income is revenue minus expenses. Your calculator apparently only has a minus button, and no plus button. The hotel and conference center is estimated by several studies to generate $2 to $3 million in state and local taxes. So if you subtract your $635,272 from that you are left with somewhere $1.4 to $2.4 million. This is simple stuff dude. Jeepers

shiftless88

We know those estimations tend to be optimistic. What if the economy tanks again like in 2008? How much tax revenue was lost during that time?

Burgessdr

Ok your argument is basically that no one should start a business or buy a house or spend any money because the economy might tank. Great argument. I bet you got all your money underneath your mattress and none in stocks, bonds, or houses.

shiftless88

Incorrect Burgess, I'm stating that government shouldn't be subsidizing a private corporation in such a way that if things go south the taxpayers are left holding the bag. Private industry can do what it wants, but government isn't private industry

nbouqu1

While yes, my training is in Political Science and History, not economics, if you look closer at my reply to myself the cost goes up to $1.5M for JUST the State Bonds. Add in the other $15M in county and city support and that doubles the year to year finance costs. So that rather rosy $3M revenue projection? Even if we hit that, we maybe barely break even. And the additional costs to state and local governments that this will incur haven't been factored in, like garbage collection. Sure we have trucks and collectors on a route already, but we're going to need more landfill space a lot sooner. Water and sewer costs? Roads? Police? Various inspectors? etc. etc. etc. If this project doesn't at the very least break even it's a drain on public resources that could otherwise be spent on schools, parks, libraries, other public services or even lower taxes. Plamandon can either build this with their own money (after paying ALL development impact fees) or not at all.

jerseygrl42

...and interestingly enough one of the Plamondons stated last week that the hotel was NOT a necessity as 1/3 of all hotel rooms in the area go EMPTY every day.....

KellyAlzan

Ok. Image be the benefits of the tax revenues if this is built using ZERO TAX PAYER DOLLARS. Who doesn't understand economics???

petersamuel

Donald: if the DH&CC undercuts other hotels it may indeed generate state and local taxes but the hotels losing visitors will then cease paying those taxes. The gross effect of the DH&CC isn't what counts, it's the net which is likely to be small. Same with jobs, spending etc. The 'impact' claims made on behalf of the project are baloney when offsetting losses of other businesses are taken into consideration. Visitors' budgets are limited, so the gain of one business is often offset by losses of others. Government should not be in the business of sponsoring one against others as the City is doing here. It's ineffective, and also plain wrong.

Burgessdr

Samuel. Your knowledge is very simplistic. There is no undercutting. The number of overnight visitors to Frederick INCREASE 5% each year. There are almost 2500 rooms in the city. 5% increase means another 120 rooms needed each years. Every 2-3 years in Frederick another hotel is built. When the last ones were built why didn't you whine and complain that it would undercut other hotels? Such a tangled web you weave with silly claims.

jerseygrl42

This is a damned travesty, using taxpayer funds to enrich two families, Randall and Plamondon...if this project can't make a profit on its own it should NOT be built...we have many more important things that need our financial attention including the trailer park schools and the parking lot I-270...these elected officials just LOVE wasting other people's money while enriching their pals.

bicep42

Why can't they find a developer with 100% private financing?

joelp77440

It wouldn't matter. Some people are so against it they do anything and I mean anything to prevent it. It's developed way beyond a hotel into the landscape of Frederick Culture. This hotel represents change and many of the old guard, who have spent most of their lives in and around Frederick oppose any change. At the NAC I attend, I routinely hear, "bring back Carmack Jays." That closed almost 20 years ago but for some, that was yesterday.

KellyAlzan

The bulk of the opposition of using public dollars. Every single Maryland tax payer should be concerned, it's their money, their state. It's about the money.

As far as the hotel itself - I don't live in Frederick city,
Could care less what is buIlt there. Can see it from my house.

joelp77440

I don't believe you. I have read your posts and you have opposed it from all aspects, either it be public funding or the destruction of the tannery. Most people against it don't live in the city, it has to do with what they remember Frederick as, not what if could be.

nbouqu1

I live in the city, and I'm a MoCo transplant, and I oppose this piece of corporate welfare,

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