The other day I wondered whether Oklahoma City with the proposed MAPS 3 convention center was drifting too far away from the formula that made the original MAPS so successful – investing in ourselves by improving quality of life. The responses were mixed, as expected; but what I didn’t expect was someone to attack the legitimacy of the argument itself.

Nick from okmet.org commented:

I don’t exactly agree with how you present the breakdown of MAPS-related economic development investment in OKC. I would say a convention center and things that lure convention crowds do just as much for quality of life and are equally important if not more so for a city to have, but that’s just my counter-opinion.

Then went on to post some comments, including:

Uh, and state-of-the-art facilities aren’t investing in the community? And the gist is that we shouldn’t even try to compete since someone somewhere will be more competitive? That’s not the can-do attitude that’s been putting OKC on the map a lot lately. Our civic leaders are resourceful and bold. They have studies the issue and came to a conclusion after years of deliberating on the issue that we do in fact need a new convention center, and for bold, they’re going to have some balls and the foresight to build something that will be a major resource for OKC for many generations to come.

OKAY, I’LL BITE.

The idea for a new convention center IS NOT about quality of life – it is clearly about economic development. If we weren’t in the midst of debating the point, I would say it was undebatable. Are there some potential benefits for the community on the side? Maybe. But that is not the reason there has been an “arms race” in convention building over the last decade . This building spree has occurred because cities everywhere recognize that tourism is an export industry; from the standpoint that it imports cash into the community.  And every city wants to add more export industries.

The only problem is that there are no barriers to entry in this export industry; any city can build a bigger, newer convention center in hopes of attracting convention goers.  Convention space is a commodity. Ultimately, success in attracting convention goers will be determined by what the city has to offer in the form of culture, shopping, entertainment, airport access, etc; which are in fact quality of life elements. Many of these elements are still lacking in Oklahoma City and this is where we can apply the “can-do attitude” to make our city more competitive.

If you don’t believe me that convention centers are not about quality of life, listen to Mayor Cornett. The Mayor chose to enumerate the MAPS 3 components in his State of the City address the way he did for a reason:

The first is public transportation. The second is a centrally located, large public park…while these two initiatives are focused directly on the quality of life for our residents, we have a third important opportunity that focuses directly on our economy and indirectly on job creation. And that is a resolution to our undersized, and thus underutilized, convention center.

BUT IS IT EVEN ECONOMIC DEVELOPMENT?

The ironic thing about it is that even from an “economic development” standpoint the impact of a new convention center is dubious.  A Brookings Institute study concluded that the benefits are often overstated:

This analysis should give local leaders pause as they consider calls for ever more public investment into the convention business, while weighing simultaneously where else scarce public funds could be spent to boost the urban economy.

And this was published before the ongoing economic meltdown.

The great thing about the Brookings Institute’s report is that it is both freely available and carried out by an organization without a conflict of interest, neither of which are true of the Chamber’s CSL Tier II study (more on that later).

Some of the Brookings’ studies findings from the summary:

• “The overall convention marketplace is declining in a manner that suggests that a recovery or turnaround is unlikely to yield much increased business for any given community, contrary to repeated industry projections. Moreover this decline began prior to the disruptions of 9-11 and is exacerbated by advances in communications technology. Currently, overall attendance at the 200 largest tradeshow events languishes at 1993 levels.”
• “Nonetheless, localities, sometimes with state assistance, have continued a type of arms race with competing cities to host these events, investing massive amounts of capital in new convention center construction and expansion of existing facilities. Over the past decade alone, public capital spending on convention centers has doubled to $2.4 billion annually, increasing convention space by over 50 percent since 1990. Nationwide, 44 new or expanded convention centers are now in planning or construction.”
• “Faced with increased competition, many cities spend more money on additional convention amenities, like publicly-financed hotels to serve as convention “headquarters.” Another competitive response has been to offer deep discounts to tradeshow groups. Despite dedicated taxes to pay off the public bonds issued to build convention centers, many—including Washington, D.C and St. Louis—operate at a loss.”

And it is not just the Brookings Institute that has found this to be true.  Other expert observers report similar findings.

Steve Malanaga of the Manhattan Institute for Policy Research writes:

The increase in space has vastly outpaced the growth of the convention industry and often failed to generate the kind of economic activity predicted by boosters. Rather than energizing local economies, in fact, some convention centers are emerging as a drag on civic finances, requiring taxpayer operating subsidies on top of their huge, publicly financed construction costs. What’s more, the situation is only likely to get worse. Another eight to ten million square feet of exhibition space is scheduled to come on line within five years, an increase of about 15 percent in an industry where demand is barely growing.

NO AVAILABLE EVIDENCE TO THE CONTRARY

That is at least part of what I am basing my current opinion on.  So what is Nick, the Chamber, and everyone else basing their pro-convention center opinion on?  Hard to say.  The Chamber – and as a result the rest of Oklahoma City leadership – is ostensibly basing their opinion on the Convention, Sports & Leisure (CSL) Tier II study.  BUT, you only hire a firm like CSL when you want someone to tell you to build a bigger convention center.  The real inspiration is probably more closely related to the fact that the Oklahoma City Convention and Visitors Bureau is a division of the Chamber – funded through taxpayer funds provided by an annual agreement with the city.  The fact that the same people pushing the convention center now, also insisted that a site for it be included in the Core 2 Shore plan – which was completed before the CSL study – provides some evidence for this hypothesis.

Either way, whether the CSL study is actually informing their thinking, or is simply an example of “experts for hire”,  I would at least like to have the opportunity to read through the findings of the publicly funded report before people are asked to approve a new tax.  But thus far my repeated requests for a copy of the report have been denied.

About a month ago I wrote Mike Carrier the President of the Convention and Visitor’s Bureau requesting the report and he replied:

We are reviewing the final draft at the present time. Once it is completed, we will have a planned rollout to the local political and business community. Only then will it be available for distribution.

I then asked to be included on the distribution list, to which he replied:

We will add you to the list to receive a copy of the materials that are distributed once they are available.

I waited a month to hear something more before I decided to try my luck with the Chamber.  I received a very quick and courteous response from a Chamber representative. I mean it, the person I traded emails with was very helpful and responsive, and I really appreciate it – but the good messenger delivered some bad news:

The full study is not complete yet. This was Phase I of II. We expect Phase II to be completed sometime in the next month. In all honesty, we really don’t anticipate the full study ever being released to the public. The study contains confidential material from clients. I know that is not the answer you probably want to hear and I wish I could be of more help to you.

TRANSPARENCY IN DECISION-MAKING

Truth be told, I really don’t enjoy taking a position opposite the Chamber.  I was hesitant to publicly oppose the Chamber building proposal and I haven’t even concluded my thoughts on that subject, so to oppose the Chamber on this agreeably defies good sense.  I only request that the decision making process on whether we build a new convention center (and on all other major decisions about our cities development) be made more transparent.  The top-down approach, with most decisions being made behind closed doors, must be abandoned or we will once again have to deal with the destructive consequences.  Because of this lack of transparency, it is impossible to fully understand the logic behind the push for the new convention center. The booster campaign that is sure to come will talk about the pressing need, and the threat of falling behind, and the potential economic impact; but there is never any real evidence or opportunity for an open public discourse.  The MAPS 3 survey was the closest thing we have had to a public process concerning this issue and public transit received over 15 times the number of votes that new convention center did . Even sidewalks had 2.5 times as many votes as a new convention center. I am not saying that that the survey results are the end all, be all; but it does make me wonder whether citizen’s viewpoints ever really count for anything.