Here Comes Another – Anyone Learn a Lesson Yet?
By Roldo Bartimole
“As a sports fan I realize that I’m biased but is anyone else getting bored with Roldo’s endless attacks on Gateway?” someone wrote in response to my last article. I must admit, the thought has crossed my mind a couple of times. I most always put the thought aside, though.
“Roldo loves to tell us that Gateway stands for all that is evil and unholy in the world. What’s the point? The deal was done 10 years ago?” he went on. He does have a point.
Warning: This column is really NOT about Gateway!
The deal may have been done 10 years ago, however, it isn’t finished. Every month you, if Cuyahoga County taxpayer, shell out about $1.25 million in “sin” taxes for Gateway. Those taxes now total $236-million. Yet, at the last meeting of the Gateway board chair (same as CFA), Bill Reidy warned that Cleveland and Cuyahoga County taxpayers would have to do more financial lifting for Gateway. He wants the taxpayers to start putting money into a fund for repairs that will cost millions more dollars. (He didn’t say it but I’ll bet that Gateway will want to extend the “sin” tax for that purpose. We have already extended it from 15 to 25 years.)
So it ain’t over until it’s over, as Yogi would say. Believe me it ain’t nearly over even though the taxes were passed in 1990 and county officials added millions of dollars, which Cuyahoga taxpayers pay separately each year.
However, the importance of monitoring this single largest project in the city’s history has other relevance, whether anyone wants to pay attention or not.
We have embarked on the exact same process with the fakery of the corporate-backed Convention Facilities Authority (CFA). And if no one pays constant attention, the taxpaying public will once again get crooked, swaged and flim-flammed.
The CFA last week ballyhooed the always-predictable consultant’s report from the always-predictable “experts.” Guess what?” They concluded Cleveland needs a 300,000 or 200,000 square foot new convention center. What a surprise!
If anyone expected consultants PricewaterhouseCoopers to come in with a report that Cleveland would be well served by a fixer-up convention center at a reasonable cost, they should immediately seek treatment for acute delusionary psychosis.
I asked the expert –Robert Canton, Director of PricewaterhouseCoopers (they can’t even work out a reasonable company name) – how much each of the two versions would cost? Answer: "Couldn’t tell ya", said Canton.
I asked, since the report predicted a number of new conventions for Cleveland, would he name one. Could not name one, said Canton.
Chairman Reidy - a retired PricewaterhouseCoopers partner (Are you surprised?) - had an abbreviated CFA meeting. He allowed Canton time to promote the plan and then called for questions from the board. He gave two members the opportunity to ask brief questions, and then shut it down when former State Sen. Patrick Sweeney began his questions. Reidy does not seem to enjoy Sweeney’s less than supportive thrust.
Reidy also notified those in attendance – mostly people wanting some kind of benefit from a new project – the public wasn’t allowed speaking privileges. Instead, Reidy announced a press conference would take place elsewhere, about a football field or more away, in the Cleveland Convention Center that no longer is good enough. (The ballroom was actually well lighted, clean and large).
It wasn’t really a press conference. It was a promotional push. The CFA had eight ringers – from moaning restaurateur and hotel executive to arts promoter Tom Schorgl hoping to score points with the big boys. They all spoke out for a new center before an obedient handful of reporters. The place was also swarming with CFA public relations people – Nancy Lesic of Lesic and Camper and the team of Ann Bloomberg and Cecilia Huffman (yeah, that one) along with others from the Visitors and Convention Bureau. Just what we need, more mouths to feed.
The most egregious act by this self-interested pack was the use of employees of hotels and restaurants to try to legitimize this planned theft of public money.
To give some authenticity to this sham press conference, a raised platform was placed behind the speakers. About a hundred “volunteers” – essentially low wage earners dragged there by employers - served as props for propaganda of CFA. Why not use people you already use in your business.
Although Canton’s report didn’t have a price tag for voters and taxpayers, he did admit that convention centers did require a subsidy.
In a day of overstatement, that was the classic understatement.
A mere cursory look on the internet will get you pages of citations on convention centers operating in the red. Indeed, more and more conventions seek FREE use of the public convention center just to come to your city. If you’re lucky, that is, because some want to be paid now to visit.
Canton tried to slur Heywood Sanders’ recent study that cities have built and/or expanded too many convention centers with not enough business to go around, labeling Sanders’ work as “a soap box he’s been on.” Even Canton admitted, however, Sanders’ had “a very valid” assessment in terms of the growing, already glutted supply of convention center space.
The record is replete with documentation that convention centers are, as Sanders notes in his new Brookings Institution report, a “failed economic development strategy.” Sanders is professor of public administration at the University of Texas in San Antonio.
Sanders notes “these trends (attendance off) – coupled with similar stories in Sacramento, Tampa, Minneapolis, Portland and Austin – demonstrate that dramatic, if no catastrophic, fall in convention activity and attendance has been both substantial and pervasive.” The demand for conventions isn’t keeping up with supply, Sanders argues, yet cities are increasing supply significantly.
He also concludes that despite the “taxing, spending and building” in city after city for more space, “the new private investment and development that these centers were supposed to spur – and the associated thousands of new visitors – has simply not occurred.”
So what are they suggesting to correct this problem? Sanders says, “that cities need more space.”
Apparently, the CFA and Cleveland corporate interests and their obedient politicians and news media dream that reality doesn’t apply to this city. It’s full speed ahead off another cliff.
Other reports - a simple check on the internet will show - give similar bad news on deficits, soaring costs of construction and overly optimistic statistics for new convention business.
The Orlando Sentinel noted that despite the “busiest 90 days in history” for its convention center with 583,000 visitors, Orlando had huge debt - $8.5 million in the red last year.
In San Diego, a business newspaper said that the expected $140 million expansion cost came in $76 million over budget.
The Pittsburgh Tribute-Review reported in April 2004 that the Sports & Exhibit Authority there just closed on a $20 million loan to cover costs of overdue bills of its David Lawrence Convention Center. They were looking to the Pennsylvania state legislature to bail them out.
Boston was expecting with its new facilities to pull 64 more conventions per year but now expects only 29 to 42 by 2010.
What does this say to Cleveland? It says only a fool will fall for the coming propaganda that Cleveland must have a new convention center.
I have to remind people that these kinds of deals mean taxes that never touch the wealthy but add to the cost of living of the rest of us.
That’s where the Gateway example should give taxpayers pause.
Someone once noted to me that if you open a door and every time you do you get bopped on the head, the lesson becomes easy in short order – don’t open that door.
Here are some of the taxes you already pay for Gateway and Browns Stadium alone:
- An 8 per cent tax on parking in Cleveland.
- A tax on hard liquor.
- A tax on beer.
- A tax on wine.
- A tax on cigarettes.
- A tax on car rentals.
- An admissions tax on each ticket to sporting event, plus added 2 percent admission tax for Browns.
- Sin taxes alone account for $236-million since August of 1990 and have been extended to 2025.
- Sales tax on the sin taxes. Yes, you paid the seven, now 8 percent, sales tax on the $236-million. Add more than $16-million more for the sales tax portion.
Have you noticed that of all the above taxes, NONE is levied on the people or corporations that benefit? In addition, these self-interests avoid paying property taxes. Do you?
Downtown floats on a sea of subsidies and they want more, more, more.
They’ll want major subsidies for a new 600-room hotel, more for the present Cleveland Convention Center’s conversion into who knows what and the same for Public Hall and the IX Center.
from Cool Cleveland contributor Roldo Bartimole
Roldo@Adelphia.net
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