Convention center? Stop the madness

Being a consultant who advises cities about things like convention centers is kind of like being a little kid.

It’s never your fault.

You can draw up feasibility studies that recommend spending tens of millions of dollars (sometime hundreds of millions of dollars) on new or expanded convention centers and never be blamed when it doesn’t work out.

You can recommend the investment even as the convention center market is oversaturated (partly because you’ve told dozens of other cities to build as well).

You can give the politicians cover even if the predictions of hotel room nights and per-conventioneer spending are exaggerations.

And when it doesn’t work out – and it never does – you can blame it on one of two factors. Either the convention center isn’t big enough or there aren’t enough hotel rooms nearby.

Then, when your predictions are wrong, you can get rehired by the same cities to convince them that if they spend even more tens of millions of dollars (or hundred of millions of dollars) things will turn around and the downtown will blossom.

It’s good work if you can get it.

So when the people who run the Greater Tacoma Convention & Trade Center recently told the City Council last month they needed more hotel rooms, it was expected. The council is now talking about using some city land next to the center to coax a hotelier to build those rooms, most likely with some help from the city.

Would that be throwing good money after bad? Tacoma and every other city hit that point a long time ago.

In testimony before Congress last spring, University of Texas professor of public administration Heywood Sanders explained why. In 1986, there were 194 convention centers in the U.S. with 32.5 million square feet. In 1996, there were 254 centers. In 2006, there were 322 and the total square footage has reached 66.8 million square feet.

Over that same time, the convention and meeting business has been slumping. America has too much supply chasing too little demand. Convention centers in cities bigger than Tacoma are practically giving away space in order to sell some hotel rooms and still can’t get enough business.

And yet we all keep building even more space and we keep subsidizing more hotels. In Washington state alone, state government has recently subsidized construction of centers in Tacoma, Bellevue, Spokane, Lynnwood, Yakima, Vancouver, Walla Walla and the Tri-Cities.

Cities build in hopes of renewing their downtowns. When they expand they’re told it is the only way to recoup the initial investment. And they base it on more consultant advice as though they’ll eventually get it right.

In an article titled “The Answer Is Always Yes,” Jeffrey Sachs of SAG told Forbes Magazine: “You lose clients if you shoot down projects. They’ve already made up their minds by the time they come to us.”

Sanders, the man the convention industry loves to hate, takes special aim at these feasibility studies. His examinations have found them overly optimistic and based on predictions that don’t come true.

“They’re for a public that doesn’t understand, for elected officials who want to do the project anyway and for most newspaper types who think, ‘It’s in the press release so I put it in the story,’” Sanders told me in 2003.

But some newspapers have begun asking questions. A project by the Orlando Sentinel in Florida concluded that even a city with Disney World and warm weather can’t make economic sense of its massive convention center. Despite expansions, deficits continue. At least Orlando officials have now pledged not to spend tax dollars for further expansions.

Before it tosses more money at the Tacoma center, the council should take a hard look at its own numbers, hopefully using someone other than the usual consultants to do the work.

Peter Callaghan: 253-597-8657

peter.callaghan@thenewstribune.com

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