Plan to overhaul Dallas convention center is a huge story, but few in the city even know about it

If you’re one of the few who is aware that the Kay Bailey Hutchison Convention Center overhaul is ongoing – maybe even demolished and rebuilt from scratch – you are likely falling into one of two camps:

Burn it down to get City Hall out of the convention business or make it the best in the US

I bet most of you don’t have the slightest idea what I’m talking about, so today I’ll be keeping everyone updated on the least covered, but momentous, story at Dallas City Hall.

We can’t even get people to pick up the trash or call 911, but with the blessing of the city council, we are well on our way to planning a renovation of the convention center – without serious public debate about whether a renovation is the right thing to do to do.

It’s a gaping hole that will eventually bite the town hall in the bum, especially as preparatory briefings for the council committees begin next month.

If you start to shake your wallet, let me point out that the millions or billions needed for the overhaul doesn’t come from taxpayers, but from hotel occupancy taxes and convention center revenue.

But that doesn’t mean we should welcome what is happening – at least not until we have more answers.

One of the shortcomings of the master planning is the lack of a “signature entry” in the Kay Bailey Hutchison Convention Center.(Elias Valverde II / employee photographer)

The momentum at 1500 Marilla St. for this latest facelift dates back to 2015. A study commissioned two years later provided a long list of shortcomings in the convention center and called for an additional ballroom and meeting rooms as well as a “signature entrance”.

Months before we heard the word coronavirus – which would effectively paralyze the convention business – the city’s employees launched a master plan initiative in June 2019 to redesign the facility.

Last January, the city council signed a $ 5 million planning contract with WSP USA, and with a virtual public session remaining on October 19, four options emerged:

Baseline Plan: For $ 500 million, it would do updates and delayed maintenance, renovate and reconfigure some rooms, and add a new annex for additional meeting rooms and ballroom.

Hybrid plan: For $ 1 billion, it would also convert parts of the existing structure to add new lobbies, meeting rooms and ballrooms.

Clean plan: demolish the convention center for 2 to 3 billion US dollars and build a new one – either underground or across Lamar Street.

In the underground alternative, the exhibition hall would be underground and the meeting and ballrooms above.

The west of Lamar alternative, which has the loudest cheerleaders, would build a new convention center along that street, with part being built over Interstate 30.

Each plan also examines how best to reconfigure the transportation options, including the DART station under the Convention Center, and coordinate it with the upcoming Dallas-Houston high-speed line.

Rosa Fleming, head of the city’s congress and event service since June 2018, plans to present the final master plan to the city’s entire council at the beginning of next year.

I attended the public session last month and checked the presentations of the previous two. I also listened to the “Telephone Town Hall” on Thursday evening and at the beginning of the week asked a very patient Fleming what must have felt like a hundred questions.

The master plan process does exactly what it was directed to do, and you can find plenty of details about each option on the city’s website.

Convention centers are one of those endeavors that every city has made for decades without seriously considering why. Like the New York Times in December with “Nobody goes to conventions. Congress centers are growing anyway. “

Dallas City Hall, the hospitality industry, and many civic leaders see the Kay Bailey as firmly embedded in the structure of all other city activities and as vital to the future of downtown.

In a good year, according to Fleming, the convention center would have $ 858 million in sales for retail, restaurants, hotels, liquor, transportation and tourist attractions.

Among the experts who have taken apart the math behind such claims is San Antonio-based urban development expert Heywood Sanders, who wrote the 2014 book Convention Center Follies.

The A lobby at the Kay Bailey Hutchison Convention Center is part of the 1970 expansion. Proponents of the revision say the convention business in Dallas will lose to other cities without major improvements.(Elias Valverde II / employee photographer)

Sanders documented how cities promise dramatic economic repercussions – which is difficult to prove – if they push for expansion after expansion to stay in the congressional game.

It feels like Dallas is on the same “it’s never enough” carousel. Remember when the city said “one million square feet” would make us the premier convention destination? Or when was “building a congress center hotel” the solution?

Now do you want to tear down and start over?

Dallas runs its convention center through a corporate fund, which means it doesn’t rely on local taxpayer dollars, but primarily on revenue billed to visitors to our hotels.

When expanded or remodeled, the Kay Bailey uses income bonds that are mortgaged against the convention center’s revenues. These debts are already huge and the bigger the city dreams, the more money owes and the more pressure on the convention center to generate business.

Should the convention center be unable to pay its debts, taxpayers would be burdened.

Since the Kay Bailey does not rely on general fund money, it generally escapes city council control. If councilors think about it at all, it is often in terms of the sales tax money generated by congress goers, which in turn feeds the general fund.

But the revenues of the last few years raise questions about this assumption.

In the 2019 financial year, the last full cycle before the pandemic, 85 events were held in the convention center. In the 2020 fiscal year, it housed 50; in the fiscal year ending this month 39.

But while the convention center hosts far less traditional events and gatherings – and as a result, hotel use tax revenues are falling – the city’s sales tax revenues are doing well.

In fact, we are well on the way to gaining 8.6% year over year when we lost just 1.3%.

A view of the lobby of Exhibition Hall D, which was part of an expansion in 2002, from the third level of the Kay Bailey Hutchison Convention Center.(Elias Valverde II / employee photographer)

Fleming attributed this separation – far less convention, but solid sales tax numbers – to pandemic-induced situational spending in many other categories: taxable grocery items, home and school supplies, equipment and furnishings needed for remote working and remodeling projects.

I suspect I’m not the only one who isn’t convinced.

Employment is another of the big numbers that City Hall and the hospitality industry point to when it comes to expanding the convention center.

According to Fleming, 13,000 tourism-related jobs lost during the pandemic were at least partially related to the absence of conventions and events at the Kay Bailey.

The overhaul of the convention center, according to Fleming, would create jobs “that are close to the areas the city is reinvesting in – South, West, East Dallas – to provide them with livable wage jobs or above-average wages to eradicate inequalities “.

The team paid for this master plan, the congress boosters and the town hall management make similar promises: personnel development, economic development, housing construction.

We have heard it for decades.

The convention center arena, along with the building that now houses the Black Academy of Arts and Letters, is the oldest part of the 1957 Kay Bailey Hutchison complex.(Elias Valverde II / employee photographer)

The city council should therefore seriously discuss one more option: sell the property and let someone else decide the best use for it. If you think the convention center business is the way to go, great.

While the Kay Bailey doesn’t cost taxpayers direct, it is worth considering how much property tax revenue would be generated if this land were privatized. The city could pay off all the debt servicing and maybe finally see some life in the dead part of downtown.

This is a complicated thing and even after doing a lot of research and talking to people on all sides, I am not here today to tell you that I know the best way to go with absolute certainty.

One thing I am sure of is that convention centers are widely considered to be a supposed part of government, but it is difficult to explain exactly why.

It’s crazy that we could spend $ 3 billion without ever having this conversation.

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