Petitioners, Council Continue Arts Center Debate; Supporters Request Current Petition Be Dropped

OCEAN CITY – An intense battle, rooted in allegations of misconceptions, continues to play out in Ocean City over a petition opposing the bond to fund the new Performing Arts Center (PAC) addition at the Roland E. Powell Convention Center.
Tony Christ, spokesperson for the Ocean City Taxpayers for Social Justice (OCTSJ), last month received approval for a petition singling out an $8.5 million bond to fund the new PAC. 
The PAC is part of a $12.7 bond ordinance. The remaining $4.23 million of the ordinance is dedicated to a roof for the Public Safety Building, a roof for the Service Center Building, a new beach patrol headquarters and an effluent disinfection system at the Wastewater Treatment Plant. All the projects will amortize over a period of 10 years.
The PAC project is under contract between the Town of Ocean City and the Maryland Stadium Authority (MSA), which is paying $5.7 million of the auditorium’s costs. The two-story, 1,200-seat auditorium is currently under construction under the auspices of contractor Whiting Turner.
The town is going to the bond market by the end of the year. In the meantime, Ocean City’s portion of the PAC is being paid for out of fund balance that will be reimbursed by the bond, which will ultimately be paid off by the food and beverage tax.
The local sales tax of .5 percent on food and beverage purchases in Ocean City is imposed for the purpose of paying the principal and interest on bonds issued to finance the construction, reconstruction, repair, renovation and equipment of the convention center.
By charter, a petition for referendum has 40 days to circulate and must obtain at least 40 percent of the number of voters, who voted in the last election or 1,226 signatures in this case. The petition’s deadline is Nov. 20. If the required signatures are verified, the bond ordinance pertaining to the PAC can be placed on the next ballot.
For the past couple of weeks, Christ has been up against city officials and PAC supporters as they have been out to clarify what they believe is misinformation being spread by Christ and petitioners.
Last Thursday Christ had submitted an email to City Solicitor Guy Ayres that he was considering announcing the retraction of the petition this week. However, Christ was not in attendance at Monday’s meeting.
Despite Christ’s absence, OCTSJ supporters Herb Pawlukewicz and Ellie Diegelmann were present to further interrogate the Mayor and City Council over the PAC and its funding.
Pawlukewicz questioned the Mayor and City Council over who authorized the PAC construction to begin prior to the bond sale.
City Engineer Terry McGean explained the floor-to-ceiling demising wall that separates the relatively new bay-front ballroom on the second floor from the construction work in the performing arts center was the first step in the project because it will prevent upcoming events at the convention center from being disrupted.
On April 2, following several meetings with MSA, Whiting Turner and convention center staff decided on the window from Oct. 20 to Nov. 12 to begin construction.
“It is always our number one goal when we work on the convention center not to disrupt or cancel any existing events, so very early on we had to establish a three-week window within the building where there were no events in the ballroom so that we could construct that wall,” McGean said. “We had to develop this schedule ahead of time for the contactor so that they could have their staff and subcontractors ready to go and for the sale staff knows not to put any new events into that room.”
Diegelmann said it is not the PAC petitioners are against. They are against the portion of the bond ordinance that states, “The City shall levy and collect ad valorem taxes upon all taxable property within the City … to pay the principle of and interest on the Convention Center portion of the Bonds in any fiscal year.”
She said, “So, if it is not costing the taxpayers one red dime let’s just eliminate clauses like that and there will not be any controversy or divisiveness. You can build the center all you want just don’t make us pay for it.”
Mayor Rick Meehan explained in order for Ocean City to go to the bond market seeking a low-interest rate the language to pledge the full faith and credit of the Town of Ocean City should be included.
“If, in fact, it was worded differently and became a revenue bond, and approved as a revenue bond the interest rate would be higher,” he said. “Since the money [food and beverage tax] is there and the money has proven it will be there, why would we pay a higher interest rate?”
Next Diegelmann brought up Christ’s alternative reasoning behind the petition that the PAC is causing the convention center to lose space and will no longer be able to hold its historically large events, such as the State of Maryland Fireman’s Association memorial service and the cheerleading convention.
Meehan clarified the first phase of the convention center that was completed last year included an expansion of a bay-front ballroom, and replaced all exhibit space that will be taken up by the PAC. The PAC is an addition to the square footage the convention center consisted of before the expansion project began.
According to the mayor, Christ’s statement that the firemen’s memorial service will no longer be able to be held at the convention center due to loss in space is false based on the fact the new ballroom can hold up to 1,896 people and the largest group the convention center has held is 1,720.
“I think it is all subject to interpretation. I am not going to sit here and dispute it with you,” Diegelmann said. “After reading all of the controversy around this…the divisiveness over this has just sickened me … no matter what happens we will lose.”
Meehan furthered the food and beverage tax was established in the 1990’s during the first expansion of the convention center by the State of Maryland. The state established the restrictiveness of the food and beverage tax to only be spent on bond indebtedness related to construction at the convention center to avoid any ambiguity. Currently Ocean City’s food and beverage account stands at over $7 million.
“Since you assume nobody is telling you the correct information, it becomes more difficult,” the mayor said to Diegelmann. “What I am saying is it is a fact the food tax money is there and it will continue to be there but it can only be used to offset and pay the bond indebtedness. You cannot just take it and pay the contractor. It can only be used by state statute to pay the bond indebtedness.”
Diegelmann accused the Mayor and City Council of steamrolling by beginning construction before going to the bond market.
“That is a cliché, and if you want to run things with misinformation that is okay,” the mayor said. “This has been voted on and approved unanimously five different times by two different councils … it wasn’t done with smoke and mirrors. It was done right here in this council chamber, and it was done with everybody’s complete knowledge of what it is going on.”
Council Secretary Mary Knight, who spent the weekend researching to clarify misconceptions advertised by Christ, stated the convention center will be gaining 9.5 percent more space to exhibit area.
Knight added Christ’s assertion the PAC will be just as large as Stephen Decatur High School’s auditorium is false. Stephen Decatur’s auditorium seats 600 and the PAC will seat 1,200 which is the same amount of seating at Virginia Beach’s PAC.
“When the State of Maryland conducted the economic study, they didn’t use just pretend numbers. They looked at other resort areas like ourselves and took actual numbers of their economic impact,” Knight said. “In Ocean City they are expecting $3 million in economic impact. In the State of Maryland they are expecting $300,000 in additional taxes and Worcester County is expecting an additional $70,000. So, all of this negative that is out there, nobody is looking at the actual study and the actual numbers.”
Mid-Atlantic Symphony Orchestra Vice President Marlene Ott was the first to approach the Mayor and City Council on Monday and thank them for growing Worcester County’s cultural atmosphere.
“A lot of times we think of Ocean City as a tourist attraction for those who come here but the improvements that you are doing at the convention center, especially the 1,200-seat professional theatre, will benefit the entire county,” Ott said.
Area resident Nicole Hills, who homeschools her 6-year old son, thanked the Mayor and City Council for bringing a cultural experience to Ocean City that she would otherwise have to drive to Salisbury, Washington D.C. or Philadelphia for.
“I have to say if two different councils agreed on this five times then it should probably just be the law of the land,” Hills said. “There will always be those people who don’t like change … but where would we be if Ocean City was still a dirt road … People need to read the economic report, and if you don’t have time to read the report then you certainly shouldn’t have the time to come before the council and complain. You need to read everything before you question the people who are doing this to benefit the entire town.”
Ocean City Cultural Arts Advisory Board Co-Chair Patti Miller has worked over 10 years to bring a PAC to Ocean City.
“It is a really wonderful and important entity to Ocean City for all of the future children, families, and for our own growth,” Miller said. “What saddens me is with all of the correct information … compiled over the last 10 years, with that many facts and information, just to prove a point that the people are the boss and government is not, is sad. This is going to be the best thing that happened to Ocean City in many years. I hope that common sense prevails, and I hope that Mr. Christ will retract his petition because it doesn’t make sense when you do know the facts. There are facts to be read, and misinformation is not right to be disseminated out by petitioners who do not understand the facts.”