Hotels May Pony Up to Fund Convention Center Expansion

The economic benefits of sports stadia and convention centers are dubious at best. (See here and here.) Often, taxpayers are asked to cough up hundreds of milllions of dollars (sometimes billions) to pay for facilities that almost exlcusively benefit private interests such as owners, players, and private investors. Such is the case playing out in Sacramento where the NBA is extorting the city to get a new $400 million arena. City council has been thankfully resistant to dumping more tax dollars into this abyss.

Now, local hotel chains and operators have come up with a plan to impose a new hotel tax to help fund the convention center expansion. This is a good sign because, as a direct beneficiary of these facilities, they are taking on more of the burden for financing them. This moves policy more toward a beneficiary and user pays principle for financing these facilities even if it doesn’t fully privatize them. According to the Sacramento Bee (20 January 2012):

“Sacramento hotel owners are considering a plan to generate $1 million a year for the proposed downtown sports arena, officials said today.

“The complicated, still-evolving plan is tied to a potential expansion of the Sacramento Convention Center.

“Brian Larson, chairman of the Sacramento Convention and Visitors Bureau, said an expanded Convention Center could yield as much as $5 million a year in new hotel occupancy taxes.

“Currently, the hotel tax goes mostly toward renovations of properties like the Convention Center and the Community Center Theater. Members of the City Council have swatted down proposals to earmark some of the hotel tax dollars to the proposed arena.”

Read more here:

For a broader discussion of how special districts can be used to pay for these facilities, see the article 1998 article in Public Administration Review by David Swindell and Mark Rosentraub “Who Benefits from the Presence of Professional Sports Teams?”

Samuel R. Staley, Ph.D. is a senior research fellow at Reason Foundation and managing director of the DeVoe L. Moore Center at Florida State University in Tallahassee where he teaches graduate and undergraduate courses in urban planning, regulation, and urban economics. Prior to joining Florida State, Staley was director of urban growth and land-use policy for Reason Foundation where he helped establish its urban policy program in 1997.

Staley is the author of several books, most recently co-authoring Mobility First: A New Vision for Transportation in a Globally Competitive 21st Century (Rowman & Littlefield, 2008). Texas Gov. Rick Perry aid Staley and Moore "get it right" and world bank urban planner Alain Bartaud called it "a must read for urban managers of large cities in the United States and around the world."

He is also co-author, with Ted Balaker, of The Road More Traveled: Why The Congestion Crisis Matters More Than You Think, and What We Can Do About It (Rowman and Littlefield, September, 2006). Author Joel Kotkin said, "The Road More Traveled should be required reading not only for planners and their students, but anyone who loves cities and wants them to thrive as real places, not merely as museums, in the 21st Century." Former U.S. Secretary of Transportation Mary Peters said, "Balaker and Staley clearly debunk the myth that there is nothing we can do about congestion."

Staley's previous book, Smarter Growth: Market-based Strategies for Land-use Planning in the 21st Century (Greenwood Press, 2001), was called the "most thorough challenge yet to regional land-use plans" by Planning magazine.

In addition to these books, he is the author of Drug Policy and the Decline of American Cities (Transaction Publishers, 1992) and Planning Rules and Urban Economic Performance: The Case of Hong Kong (Chinese University Press, 1994).

His more than 100 professional articles, studies, and reports have appeared in publications such as The Wall Street Journal, The New York Times, Washington Post, Los Angeles Times, Investor's Business Daily, Journal of the American Planning Association, Planning magazine, Reason magazine, National Review and many others.

Staley's approach to urban development, transportation and public policy blends more than 20 years of experience as an economic development consultant, academic researcher, urban policy analyst, and community leader.

Staley is a former chair for his local planning board in his hometown of Bellbrook, Ohio. He is also a former member of its Board of Zoning Appeals and Property Review Commission, vice chair of his local park district's open space master plan committee, and chair of its Charter Review Commission.

Staley received his B.A. in Economics and Public Policy from Colby College, M.S. in Social and Applied Economics from Wright State University, and Ph.D. in Public Administration, with concentrations in urban planning and public finance from Ohio State University.