Taxpayers could be on the hook for $2 million to help the downtown convention center settle a lawsuit in which banquet staffers claimed they never got a cut of a service charge billed to customers.The city and its Rochester Convention Center Management Corp., a nonprofit formed to oversee the city-owned facility, have reached a $2.4 million settlement of the class action lawsuit, records show.

But the nonprofit’s most recent tax filing showed it has less than $600,000 in net assets.

Thus, Mayor Lovely Warren is seeking City Council approval to loan the nonprofit $2 million to be repaid over 20 years at 2 percent interest. Payments could be deferred in any year the center is unable to pay, records show. There also is a promise to develop a business plan that will increase revenue or reduce expenses at the Joseph A. Floreano Rochester Riverside Convention Center to make repayment possible, Warren wrote to City Council on Thursday.

The lawsuit against the nonprofit was filed in August 2014, in state Supreme Court, originally on behalf of four banquet service workers. The issue was a mandatory 21 percent charge being added to banquet customer bills, and whether those customers could reasonably mistake that as gratuity charge or whether it should be considered as such.

Warren, referring to the add-on as an “administrative charge,” said the settlement covers 2008 through 2014.

In justifying the loan, Warren pointed to the convention center’s economic value for the city, supporting local hotels and other tourism-related businesses by attracting “thousands of visitors” to the area each month. Lawyers and other officials involved in the lawsuit could not immediately be reached for comment Thursday evening.

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