From the time the new Pittsburgh International Airport terminal opened in 1992, Allegheny County officials were eager to lure a hotel to the site. It turns out they were so eager that they negotiated a bad deal for taxpayers.
The Hyatt Regency Hotel opened in 2000 with a pledge by the owner that it would pay as much as $767,000 a year to Allegheny County, Findlay Township and the West Allegheny School District. Twelve years later, not one penny of it has been paid.
In the 1990s, Allegheny County's own authorities were tied up in other projects, so former Commissioners Mike Dawida, a Democrat, and Bob Cranmer, a Republican, approached the Dauphin County General Authority for financing. Dauphin, which had gone on as buying binge that included three golf courses, a Harrisburg parking garage and office building, agreed.
The devil was in the details. It said the Dauphin authority didn't have to make payments in lieu of taxes until after first paying principal and interest on the debt, setting money aside for furniture and equipment, covering rent to Allegheny County Airport Authority for the land and covering Dauphin's administrative expenses.
Although the hotel has been operating in the black, the authority claims it hasn't had enough money to compensate the taxing bodies for their loss of property taxes.
All three entities are contemplating their next step. They have nothing to lose and plenty to gain by pursuing legal options to recoup some compensation for this unwise investment.