Public-private partnerships bring together the experience and skill of government with the innovation and efficiency of business to produce significant economic development and public service projects for communities.
These partnerships are created through a contractual agreement between a public agency and a for-profit corporation. Through the agreement, the partners share skills and assets to deliver a service or facility for the use of the general public. The partnerships are intended to bring to a project greater efficiency, better access to capital, and increased intellectual resources. They typically result in increased quality at a reasonable cost.
The Lancaster County Convention Center and Lancaster Marriott at Penn Square
In 2001, a public-private partnership was formed for the purpose of developing, designing, building, and operating a convention center and headquartered hotel. The most important regional economic development project in decades, this project had always been planned to bring additional jobs and financial strength to Lancaster.
The partnership joins two entities
- The Lancaster County Convention Center Authority – In September 1999, the Lancaster County Convention Center Authority was formed and charged with the mission of bringing the best convention center to Lancaster. The Convention Center Authority is directed by a volunteer board, which is appointed by Lancaster County and City governments.
- Penn Square Partners – Penn Square Partners comprises general partner Penn Square General Corporation, which is affiliated with the High companies; Fulton Bank; and Lancaster Newspapers, Inc. Formed in February 1998, this alliance was actively involved in furthering public discussion and consensus on the revitalization of downtown. (Fulton Bank, an original member of Penn Square Partners, withdrew from Penn Square Partners to participate in Penn Square Partners’ debt financing.)
The agreements between Penn Square Partners and the Lancaster County Convention Center Authority establish performance covenants and carefully protect the interests of the community.
Components of a Successful Public-Private Partnership
The public-private partnership between the Lancaster County Convention Center Authority and Penn Square Partners has the five critical components that the National Council for Public-Private Partnerships says are necessary for success: political leadership, public sector involvement, a strategic plan, communication with stakeholders, and an appropriate private-sector partner.
Government leaders actively involved with the project included Pennsylvania Governors, State and Local Representatives, County Commissioners, Lancaster City Mayors, and the Lancaster City Council.
Public Sector Involvement
Comprising leaders from various sectors of the community, the Lancaster County Convention Center Authority Board of Directors voluntarily contributes hundreds of hours to make the tough decisions necessary to bring this project to Lancaster. In addition, the project has been supported strongly by both the Redevelopment Authority of the City of Lancaster and the Parking Authority of the City of Lancaster.
Since early 1998, Lancaster’s community and business leaders had been working together to create and implement a plan for stimulating the city’s economic revitalization. A key component of that plan to grow downtown was the construction of a convention center and headquarters hotel. The project was expected to:
- Create 520 to 590 construction jobs.
- Create 200 to 300 full-time jobs to staff the hotel and convention center.
- Increase Lancaster County tourism by an additional 114,000 to 147,500 visitors annually.
- Inject $150 million into the local economy during construction: $110 million in sales of Lancaster County-produced goods and services and $40 million in personal income.
- Inject $42 million per year into the local economy during operation: $31 million per year in sales of Lancaster County-produced goods and services and $11 million per year in personal income.
- Generate additional tax revenue for Lancaster City, Lancaster County, and the School District of Lancaster.
Communications with Stakeholders
Ongoing communications continued with community organizations and special-interest groups that would be affected by the project. A consortium was formed to discuss and participate in the overall direction of the project and enhance Lancaster’s attractiveness as a tourist destination.
Comprising three established and respected Lancaster-based businesses, Penn Square Partners is committed to the prosperity of this community. These businesses employ thousands of Lancaster County residents and pump millions of dollars into the local economy. Throughout the history of the project, Penn Square Partners has demonstrated a commitment to the goal of revitalizing Downtown Lancaster.
An additional partnership was formed with Lancaster’s Historic Preservation Trust when, during a pre-construction archeological dig, a cistern was unearthed that was suspected (and later proved) to have served as a hiding place for Americans escaping slavery. The LCCCA now partners with LancasterHistory.org, the organization that currently leads future development of the project.
History of Public-Private Partnerships in the United States
For more than 200 years, public-private partnerships have been used in this country to develop and renew critical infrastructure.
The first documented public-private partnership in the United States dates back to 1652, when the Water Works Company of Boston, a private firm, agreed to provide drinking water to citizens in the community. Today, U.S. cities work with private industry to provide, on average, about one-third of basic municipal services.