A version of this commentary appeared in the News-Tribune.
On November 4, Jefferson City voters will decide on a proposal to renew the city’s seven percent hotel tax. The proceeds from the tax will help fund a new conference center for the city. Supporters of the new conference center have claimed it will create 370 new jobs and generate over $100 million in economic growth. Exaggerated estimates such as this one have been made on behalf of convention and conference center projects all around the country for decades, and the historic evidence is clear that Jefferson City voters should be dubious of such claims.
Between now and November, Jefferson City residents who visit St. Louis should drive by the largely empty dome attached to St. Louis’s downtown conference center to see how these conference center promises often play out. That dome was a part of a large convention center expansion in the 1990s. The same promises of growth, revenue, and utopia were all made when St. Louis voters approved a hotel tax increase back then. Now the dome is mostly empty, and the regional body that manages it is struggling to pay for its upkeep. You can also visit the site of the taxpayer-subsidized convention center hotel that went along with the project. You can only visit the site of the hotel, not the hotel itself, because the hotel failed and was foreclosed on long ago.
Like a Cold War general in a Kubrick movie or a carpenter with a box full of nails, local tourism agencies have the same solution for every problem. Economic recession? Expand the convention center. Economic growth? Enlarge the convention center. Global nuclear war? Definitely gonna need a bigger convention center to commiserate in.
The renewed hotel tax isn’t the only public money being used as part of this plan. State tax dollars are being pursued in the legislature, and the conference center may receive local tax subsidies.
Supporters of the conference center plan in Jefferson City would likely say their plan is not as grandiose as a major convention center and dome project in St. Louis, and they are correct in that regard. However, there are plenty of examples of more comparable projects that have failed to reach the level of activity anywhere near was promised. Haywood Sanders is a researcher and writer with the University of Texas–San Antonio who has studied convention center expansions for decades. He has documented how cities and tourism agencies systematically inflate projections to get these projects approved. Sanders has cited the actual and underwhelming numbers of very comparable projects in Overland Park, Kansas, and St. Charles, Missouri. Overland Park opened its convention center and hotel in 2002. Project supporters had projected $36 million in annual hotel revenue by 2012, but the reality was much lower, coming in at under $20 million.
Sanders explains that the convention and conference-center industry peaked in the early 2000s and shows no signs of returning to the success it had back then. With a major convention area nearby in Lake of the Ozarks, a new center in Jefferson City will face intense competition for these limited conference opportunities.
Taxpayers should not be on the hook for conference centers whose overstated benefits, small as they will be, will largely go to private entities. Jefferson City is the capital of the Show-Me State, and the claims being made by convention-center supporters should be met with a healthy dose of skepticism by voters.
