As more information comes in, two things become even clearer: Plans to expand the Boston Convention & Exhibition Center, or BCEC, are absurd, and the project is like a case study in special-interest politics.
Convention centers are supposed to bolster the local economy by attracting visitors who would otherwise spend their money elsewhere. The best measure of success is the number of hotel room-nights they generate. We’re told that the BCEC needs to expand because space limitations and lack of availability at the bursting-at-the-seams facility mean we’re losing out on room nights.
The 1997 feasibility study on which the decision to build the BCEC was based projected that it would generate 794,000 room nights annually. But we recently learned that the facility actually generated a paltry 264,669 room nights during the fiscal year that ended last June 30.
So much for bursting at the seams.
Look more closely and the numbers are even more devastating. Not only is the BCEC’s room-night generation one-third of what was projected, but the biggest building in New England actually generates more than one-third fewer hotel room nights than the much smaller Hynes Convention Center produced in 2000, before taxpayers spent $850 million to build the BCEC.
The BCEC is hardly alone. There was a little over 36 million square feet of exhibition space in the United States in 1989. By 2013, that number had nearly doubled to 71.1 million. But demand has remained flat at best, which is why Las Vegas, Orlando, Chicago and Atlanta are among the cities that recently competed expansions only to have the larger facility do the same amount or less business than before it was enlarged.
Yet despite dismal performance and a declining market, proponents maintain that we must expand the BCEC.
The Massachusetts Convention Center Authority wants expansion because it would grow an MCCA empire fueled by a $123 million operating budget, nearly half of which is supported by taxpayer subsidies, and keep $5 billion in hotel tax receipts flowing to the authority after the original BCEC construction bonds are paid off in 2034.
Another quasi-public authority, #massport, is pushing for expansion because it stands to reap a windfall as owner of the land next to the BCEC, on which a publicly subsidized headquarters hotel would be built. The Convention Center Authority is now appealing to the city of Boston for a tax break to build the hotel. They’ll need it; developers aren’t too keen on building hotels next to empty buildings.
Unions get their share too. The BCEC would expand using a project labor agreement, which means the nearly 84 percent of Massachusetts construction workers who choose not to join a union would be locked out of the $1 billion project.
Thankfully the Charles Baker administration has put the brakes on selling expansion bonds as it analyzes the issue.
BCEC expansion is like the perfect storm; all the usual suspects get a piece of the action — and taxpayers get the shaft. You can’t help but wonder whether its proponents even possess the capacity to feel shame.
Charles Chieppo (email@example.com) is principal of Chieppo Strategies LLC and a former vice chairman of the Massachusetts Convention Center Authority board of directors. This piece first ran in the Boston Herald.
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