Downtown hotel 1

An artist’s rendering of the downtown hotel and conference center project, as viewed from the northwest corner of Patrick and Carroll streets.

The first of five parties on Thursday signed off on a new agreement critical to advancing a proposed downtown hotel and conference center project.

The Frederick Board of Aldermen voted 4-0 to give its blessing to the five-party memorandum of understanding. The nonbinding agreement was required for the project to receive a $1 million appropriation included in the state’s fiscal 2017 budget.

The other partners in the agreement are the Frederick County government, Plamondon Hospitality Partners, the Maryland Stadium Authority and the Maryland Economic Development Corp., or MEDCO.

The aldermen’s approval Thursday came after comments from about a dozen speakers who were for and against the project. Residents and business owners also weighed in on the agreement during two prior workshop sessions.

Much of the document echoes the terms of previously approved agreements for the funding, ownership and operations of the roughly $84 million project.

One major change under the new memorandum is the owner of the conference center, now proposed as the Maryland Economic Development Corp.

MEDCO is a state agency that borrows money and issues bonds to help state and local economic development agencies and private companies with projects that benefit the public.

Prior plans called for hotel developer Plamondon Hospitality Partners to own and operate the conference center.

Plamondon will still be responsible for covering any potential shortfall in anticipated revenue for both the hotel and the conference center.

The agreement also includes provisions that any party can terminate the memorandum at any time for any reason.

Plamondon will also foot the $53 million cost of the 200-room hotel and corresponding retail component, per a December 2015 agreement between the city and Plamondon.

The 20,000-plus-square-foot conference center, parking and related public improvements will come from a combination of city, county and state funds, the prior agreement stated. The total public contribution under the new agreement is listed at $31 million in one place and $30.35 million in a different place.

The city of Frederick’s costs are estimated at about $5.95 million: $2.2 million in tax-increment financing or a “similar funding mechanism,” $3.5 million in cash and bond revenue from the city parking fund; and $250,000 allocated in the city’s capital budget, according to the agreement.

The county will also use tax-increment financing or similar mechanism to provide $2.8 million in funding, according to the agreement. The TIF allows the city and county to use a portion of the anticipated taxes generated from the project toward funding the development.

The Maryland General Assembly has also preauthorized an additional $15 million in its fiscal 2018 and 2019 budgets.

The Frederick County Council is scheduled to hold a public hearing and vote on the agreement Tuesday. The two state agencies are expected to review and vote on the memorandum at meetings within the next month, according to Richard Griffin, the city’s economic development director.

Plamondon can approve the document at any time, Griffin said.

The agreement must be returned to the General Assembly’s budget committees for a 45-day comment period once it is signed by all parties.

Assuming a $7.5 million appropriation from the state in both its fiscal 2018 and 2019 capital budgets, as well as a host of other intermediary milestones, a 20-month construction period could begin by July 2018, according to a project schedule in the agreement. The document does not specify a completion or opening date.

The property at 200 and 212 E. Patrick St. is currently 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.

Follow Nancy Lavin on Twitter: @NancyKLavin.

Nancy Lavin covers social services, demographics and religion for The Frederick News-Post.

(35) comments

gary4books

Arsenic is a naturally occurring element that is widely distributed in the Earth’s crust.

KellyAlzan

bedbugs too. Patrick street will be infested

KellyAlzan

This rogue deal is going to put kirbie delaughter in the county executive seat. Guaranteed.

Not saying I support him as CE, but this will be the straw that broke the camels back.

All this work Jan has done cleaning up from the balane board, and now she is ruining herself.

I hope the plamamdoons are worth the turmoil we'll have after kirbie takes the CE seat.

francesca_easa

"MEDCO is a state agency that borrows money and issues bonds to help state and local economic development agencies and private companies with projects that benefit the public."

How does this benefit the residents of Frederick? Is there a guaranteed minimum wage of $15/hour? Will only people who live in Frederick be hired? Will the view of the skyline still be intact? Will local shopkeepers be guaranteed that no corporations (e.g., Starbucks, TGIF, Subway, CVS) come in and bump out their businesses? Will they have a tourist/concierge desk in the hotel that will undercut the value of the Visitor Center employees and volunteers? Did you notice that the hotel also comes with retail space (e.g., Roy Rogers, Gift Shop). A 20 room bed and breakfast at the site would have been more reasonable. I think we should organize a picket line. I will ask at the library how we can meet to organize this.

BlueDawn666

let us know francesa...about the picket line...you would probably be surprised at how many people will come.

NONE of this is in writing: is there a guaranteed minimum wage of $15/hour? NO Will only people who live in Frederick be hired? NO Will the view of the skyline still be intact? DON'T KNOW YET, there has yet to be any finalized plans...Will local shopkeepers be guaranteed that no corporations (e.g., Starbucks, TGIF, Subway, CVS) come in and bump out their businesses? NO guarantee that none of that won't happen..: remember that.

sofanna

And, in the beginning of discussions on this project, the citizens were NOT going to be taxed. We've been thrown under the bus. I had better hopes for a less corrupt local government. This is being shoved down our throats by the County Executive. I DO NOT WANT to pay for this project.

DickD

Nor do I see why out taxes are being given to subsidize the Plamondons and the Randalls. Adding insult to injury other hotels will have their taxes raised to subsidize their competition. This stinks to high heaven!

elymus43

The city voters should remember this deal in the next election, and VOTE these people out of office

gary4books

They have my vote for helping local businesses downtown.

DickD

We, the taxpayers of Frederick County and the state of Maryland, are about to be cheated of our taxes.

sofanna

They lied to us. Yes we are going to be taxed.

jerseygrl42

...and isn't it interesting that 4 of the 5 entities involve TAXPAYER money to be funneled into this project and eventually to the bottom line of the 2 private entities, Plamondon and Randall.....and you continue to avoid putting the parking deck money into the total which will be in excess of $100 million....

BlueDawn666

Creative misdirection Jersey....but you caught it. You should listen to the meeting last night...listen to how Richard spins this...your head may explode. Don't say I didn't warn you. It was hard to sit there and not be able to counter him. Also make sure you follow this blog..written by Peter Samuel.

Frederick Hotel Boondoggle....
http://frederickhotelboondoggle.us/2016/10/proposed-chamber-of-commerce-letter-of-credit-for-dhcc-causes-stir-in-winchester-hall/#comment-32

His latest post:
“The Board of Public Works is especially concerned that the grant recipients utilize a competitive process to select their contractors.” So writes Catherine Ensor, program manager for the Capital Grants Program at the state Board of Public Works which administers state grants to the DH&CC. (SOURCE: letter to Mayor McClement dated 2016.06.10 in the package A.1)

Is this just boilerplate? Perhaps.

But what if it is meant seriously?

http://frederickhotelboondoggle.us/2016/10/state-board-of-public-works-wants-competitive-procurement-its-lack-has-plagued-this-hotel-project/

Burgessdr

BlueDawn. Powerful argument last night. "I am concerned with the future of Frederick if the hotel gets built. I like to vote for people that govern in the common sense way, use common sense, that makes common sense. There is no evidence that anyone one will come here. This does not make sense. Why are they going to come here. That is common sense. There is nothing here. Why would anyone want to come to Frederick? I agree with the other speaker who said Frederick is a craphole. People here are not educated and the large businesses are milking Frederick. You need to use common sense, this does not make sense, govern the common sense way, use your common sense, this doesnt make sense."

BlueDawn666

I noticed you weren't there last night Donald, I was hoping to meet you. I am surprised you didn't come, what happened? I figured you would have been there...also you seem to have a listening problem...

Burgessdr

It heard it fine. Word for word. Please use common sense. There is nothing here in Frederick. You know that does not make common sense. Why would anyone come to Frederick? That doesn't make sense. The city is not governed with common sense. There is no evidence that anyone would want to come to Frederick. That is not sensible. Coming to Frederick is not sensible. Not a common thing to do. Its not governed commonly. Just make no sense at all. Commonly.

BlueDawn666

So Donald when do you think we might meet in person and discuss this? I will be at the County Council meeting Tuesday will I be seeing you there? You seem to have a lot to say about the DH&CC why don't you come and cheer lead that night, show your support, the Council will be voting for the TIF, but hey at least get your voice heard, and I would really like to meet you dude?

Burgessdr

Be sure to tell the County Council to govern with common sense and that there is nothing worthwhile in Frederick.

gary4books

I have read that a hotel will bring bed bugs to downtown Frederick. We already have the visitors. There IS evidence. This is just to give them reason to stay one or more nights and venture out to local sights.

glenkrc

Who didn't vote? And Why? Seems to me that would warrant being placed in the article.

BlueDawn666

Donna didn't vote cause she wasn't there last night...

glenkrc

Thanks. Makes sense.

Fredmd21704

WHAT? No whining from the Kelly peanut gallery yet?

Dwasserba

If you resist an idea, it's "whining" -- when everyone knows, if you aren't liking something, the best remedy is to hold their nose and shove it doen their throat. Makes you appreciate breathing. Re-aligns your priorities.

BlueDawn666

What's there to whine about?? .....Why should Kelly waste his breathe whining about a done deal?

Fredmd21704

because Kelly doesn't like change.

BlueDawn666

Plamondon will still be responsible for covering any potential shortfall in anticipated revenue for both the hotel and the conference center......BUT they don't have this in writing...they do not have Peter's signature on any legal binding document that holds him to that...remember that.

Nor is this is any legal binding document:
Plamondon will also foot the $53 million cost of the 200-room hotel and corresponding retail component, per a December 2015 agreement between the city and Plamondon.

Richard Griffin kept saying to the Aldermen that no tax dollars are involved but to me this does very much looks like our tax dollars are being used...
The city of Frederick’s costs are estimated at about $5.95 million: $2.2 million in tax-increment financing or a “similar funding mechanism,” $3.5 million in cash and bond revenue from the city parking fund; and $250,000 allocated in the city’s capital budget, according to the agreement...all that money came our tax dollars....so why wasn't Richard telling the truth and why did the Aldermen just sit there with stone cold faces and vote our tax dollars right down a rat's hole? Well because a few of them were worried about their future campaign donations, didn't want to jeopardize those...and it was crowd mentality last night,none of them wanted to break from the crowd..

I was going to say vote wisely in the upcoming election....but when a deal is in the bag it's in the bag, which this deal was years ago...so really I guess this is evidence that your vote really doesn't matter. When a deal is in the bag, it's in the bag, your voice nor your vote counts for much when money is doing the talking..which it was last night, in more ways than one.

jerseygrl42

Its always all about the MONEY...and the taxpayers are usually the losers ... and you can add another $20 Million to this project for the cost of the parking deck

sofanna

I'm glad someone else remembers that the taxpayers weren't supposed to be taxed to support this project. I guess no one cares how much less net cash Fredericktonians will have due to being taxed for something most of us don't want and will never benefit from.

des21

Good for you FNP owners. Toxins be darned! Guests will only be there briefly right?

jerseygrl42

actually MDE has stated that the arsenic and other toxins will have to be abated after the final deal is crafted and before construction can begin...so guess who will pay for that abatement.....

DickD

If they don't clean up the toxins, which they probably can, it will be known and nobody will want to stay there. This is not an issue that concerns me, it is the tax money that concerns me.

gary4books

Good for Frederick.

ReadPhred

[thumbup]

bosco

Don't tax you, don't tax me. Tax that person behind the tree.[wink]

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