Convention Center Hotel “Vote No” Launches first television ad, plus Q & A from Mayor Tom Leppert
It looks like “Vote No Dallas” has come out of it’s shell and is going on the offensive against the attack ads launched by Vote Yes. Here’s their first television ad and content from a Question and Answer document that accompanied the letter from Mayor Leppert that was posted here yesterday.
For more information visit voteNOdallas.com
Q.What is the convention center hotel project?
A. On May 14, 2008, the Dallas City Council approved plans to build an attached convention center hotel on a portion of an 8.4-acre site at the southwest corner of Young
St. and Lamar Blvd. Plans are to build a four-star convention headquarters hotel with 1,000 guestrooms; food and beverage facilities including restaurants, lounges and coffee kiosks; 80,000 square feet of meeting space including grand and junior ballrooms; and 720 parking spaces.
Q.Why is the convention center hotel needed?
A. In today’s competitive market, a city must have an attached convention center hotel to compete nationally and draw the largest U.S. conventions, which attract 20,000 to 50,000 visitors at one time. Until the Council’s recent approval, Dallas was the only city of the top 22 U.S. convention markets without a convention center hotel announced, under construction or completed.
With a $2.6 billion annual economic impact, tourism is a big part of Dallas’ economic vitality. The Dallas Convention Center is a $1 billion asset for the City, an economic engine that generates millions of dollars in revenues used to help fund roads, police, public safety and other city services.
Without the Convention Center and hospitality-related revenues, Dallas taxpayers will be responsible for a much bigger portion of the tax burden. The Convention Center is
an important asset we must protect, and the hotel is a vitally important investment for our future.
Q. Do other Texas cities have convention center hotels?
A. Although Dallas/FortWorth is the No. 1 visitor destination in Texas for the fourth straight year, Dallas remains the only major Texas city that lacks a convention center hotel. Houston, San Antonio, Austin, FortWorth and several D/FW suburbs have either constructed or are in the process of building a convention center hotel. Houston’s hotel has been so successful they hope to sell it for a $70 million profit and are planning to build a second one!
Q. What happens if we don’t build the hotel?
A. Right now, because we lack a convention center hotel, the City of Dallas is losing out on approximately $800 million in direct spending and $2.6 billion in annual economic impact. Further, the Dallas Convention & Visitors Bureau (CVB) reports that more than 80 groups have reported they WILL NOT bring future meetings to Dallas due to the lack of a convention center hotel.
Bottom line, if we don’t build the hotel, Dallas will remain a second-tier convention destination (or likely drop to a third-tier destination) losing business to cities of all sizes that have built hotels to capture more business.
Q. Will big conventions come to Dallas if we build the hotel?
A. In the 2007-2008 fiscal year, the Bureau booked more than 1 million definite room nights – a record for the Dallas CVB – representing more than $1 billion in economic impact. The remarkable growth is credited to the Dallas City Council vote approving the hotel. Because of the hotel, the Dallas CVB booked almost 177,000 more definite room nights – a 20% increase – over the previous year.
The first quarter for the 2008-2009 fiscal year is looking even better, at more than
225,000 room nights or 31% over the previous first quarter. Since the Council’s vote, the Dallas CVB has booked thirteen city-wide conventions and is in negotiations with another twenty-four, representing more than $500 million and $900 million respectively in economic impact.
However, all of these bookings are contingent on the construction of a convention center hotel. If the hotel isn’t built, we will lose bookings for 392,000 room nights, representing $500 million in economic impact.
Q.Will building the hotel create new jobs?
A. Yes! In addition to helping support the existing 50,000 hospitality jobs, the hotel will create 3,800 jobs – 3,000 full-time construction jobs and 800 full-time permanent hotel jobs. Also, the City has developed one of the nation’s most innovative MWBE programs for a public project, providing unprecedented levels of participation and support services to minority contractors.
Q.Will there be new development around the hotel?
A. Yes. Matthews Southwest, the North Texas-based developer chosen by the Dallas City Council, has plans to build new retail, restaurants and entertainment venues. Development around the site will connect the Convention Center and hotel to the rest of downtown Dallas.
Q. How much will the new hotel cost, and how will it be financed?
A. On December 5, 2008, the Dallas City Council’s Economic Development Committee received from the developer, Matthews Southwest, a guaranteed maximum price (GMP) of $356 million for the hotel. The project will be financed through tax-exempt revenue bonds, which are often used because cities can borrow money at a far cheaper rate than the private sector.
Tax-exempt revenue bonds are different from general obligation bonds, which were used for the 2006 City of Dallas bond campaign and other previous bond campaigns.
The tax-exempt revenue bonds will be repaid with revenues from guests staying at the hotel … not from Dallas taxpayers. The hotel is projected to have a positive cash flow from the day it opens.
However, as part of the hotel financing package, the City has provided for a $50 million reserve fund to protect against any unforeseen circumstances. Tax-exempt revenue bonds are how many competing convention cities – including Houston, Denver, Baltimore and Phoenix – have financed their convention center hotels.
In addition, a Texas state law allows the City to recapture the state’s portion of the sales tax from the hotel to pay off the bonds.