Convention Center Follies; Austin Edition

The Austin Convention Center has recommended a long range master plan laying out their case for expansion west, taking the blocks bounded by 2nd on the South, 4th on the North, Trinity on the East, and San Jacinto on the West.  AURA opposes this on a variety of grounds, ranging from the tax revenue for the city to the viability of convention center-driven economic development to impacts on the downtown streetscape.  

The economic development case against convention center expansion:
  • The convention center industry nationally has been shrinking since the '90s.  Meanwhile, city after city has been chasing this business, building ever more elaborate, newer, and larger convention center spaces.  Competing for convention center business is not a smart use of resources - its going after a shrinking pool just as many peer cities have entered the competition. 
  • Jobs created by conventions are by their nature transitory, part-time, and generally low-wage. This is a business of peaks - generally weekends when a large convention is booked. The caterers, Uber/Lyft/cab drivers, extra hotel staff, and contractors working booths see spikes in business, but it is not enough to sustain week-in, week-out full employment. While there is a place in the economy for these kinds of jobs, spending limited city resources to subsidize them seems unwise given better alternatives. 
The city revenue case against convention center expansion:
  • Convention Center expansion is often sold as a free lunch.  The cost of construction could be financed by the increased hotel taxes brought in by hotel goers.  But this turns out to be an almost circular argument.  Hotel taxes have extremely limited uses by state law - they can be used for tourist-related public improvements and for historic preservation. Currently much of our hotel tax revenue already goes to support the Convention Center.  By investing in a bigger convention center, we may indeed be able to capture more hotel tax revenue, but their limited nature makes them much less useful to the city as a whole.  Bringing in more hotel taxes does little for the general welfare of most Austinites. Meanwhile, the city should consider whether it is making the best uses of its hotel taxes - instead of subsidizing an otherwise mediocre convention center, could they be used to support the live music or arts scene?  Could there be a role for hotel taxes in subsidizing the downtown "Drunk Tank" under consideration?  
  • Meanwhile, the expansion would take a valuable piece of downtown property off the tax rolls.  Property taxes, unlike hotel taxes, go to the general fund, and are much more useful to the city budget.  There is no fiscal impact analysis taking this into account in the current Convention Center Master Plan. Hotel tax revenue are estimated, but these kinds of large impacts are not projected.  
Finally, the urbanist and streetlife argument against convention center expansion. 
  • Convention centers are seldom well activated on the street level.  Austin has invested, with much success, in a Great Streets program, and we are beginning to reap the dividends of a vibrant downtown. Several aspects of the proposed design of the Convention Center Expansion run contrary to the tenets of the Great Streets concept, especially the elevated pedestrian walkways to connect the old and the new Convention Center areas. These kinds of walkways hurt the street life below, and take pedestrians out of contact with each other.  
  • The preferred scenario in the Master Plan would also take a chunk of 2nd and 3rd Streets between Trinity and San Jacinto, degrading the downtown grid and taking streetscapes out of play.
In short, the Austin Convention Center Master Plan as currently envisioned should not be endorsed by city council.  The business and economic development case has not been made for such a large capital investment, the opportunity costs in terms of property tax revenue are high, and it be a step back from for Austin's steadily improving downtown experience. AURA calls on city council to vote this down.

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