19 years later, SLC convention hotel battle is evolving

Politicians, often prone to rash decisions when experts tell them economic development is on the line, cannot be accused of hurrying when it comes to deciding whether to subsidize a large convention hotel in downtown Salt Lake City.

How long have they deliberated? On the day I first wrote a column about the idea, it would be safe to say (as it would be of any day) many babies were born. Last fall, many of these were freshmen at universities.

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For the record, I was against the idea of tax money for a hotel back then.

Today? Well …

As the monkey said to the jellyfish, I may be evolving.

State lawmakers begin their annual session tomorrow at the State Capitol. Expect the question of whether to subsidize a convention hotel to the tune of $100 million to be on the agenda again. Last year the measure passed the Senate but ended four votes short in the House. That was tantalizingly close, and backers of the idea seem emboldened. But they are being challenged by an interesting counter-proposal.

The arguments have changed little since I wrote that first column on the subject, May 4, 1995. Back then I said, “Once they understand the need and realize money can be made, developers will build a large hotel on their own.”

Earlier this month, County Councilman Richard Snelgrove told the Deseret News, “If this is such a good idea, a developer will jump in and fill the void.”

I doubt he accessed newspaper archives before making that statement, so I will refrain from taking credit for inventing the idea. And yet it may have occurred to more astute readers that developers have been remarkably willing to refrain from jumping during the intervening 19 years.

Every time the market demands new hotel rooms, it seems someone comes along and supplies 200 or 300 of them — far short of the 1,000 or so a convention hotel would hold.

And yet there is demand. I can say that with certainty, having spent several years on the board of the Society of Professional Journalists. Each year we would choose a site for the annual convention, rotating through regions of the country. Each time the Rocky Mountain region came up, we would choose Denver because Salt Lake City didn’t have a convention hotel capable of holding all our delegates.

However, the question of how large this demand really is cannot be answered easily. That’s where the counter-proposal comes in.

The Utah Taxpayers Association, the Utah Hotel and Lodging Association and their allies say it’s fine to subsidize new visitors to the city, and they’re anxious to do just that; but only that. Their plan is to give whoever builds such a hotel a tax subsidy each year based on the amount of new business the developer can demonstrate actually came to town. That way, government isn’t paying to take money from existing hotels.

It’s an interesting idea, even if the practical details seem daunting. For instance, would any group that came here in the past not qualify as new business if they came again? What if that group had grown in size and needs in the interim? Other than a few conventions and trade shows, hardly any group goes here, or anywhere else, year after year. What counts as new business?

I admire the idea, however, of bringing real accountability to public subsidies, something lacking in the soccer stadium and Broadway theater plans politicians have rashly hastened to in recent years.

This issue may have reached a turning point.

If you listen to County Mayor Ben McAdams and other supporters of a straight $100 million subsidy to be repaid through taxes generated by the hotel, demand is high.

If you listen to the other side, demand is only about 50,000 room nights per year, which translates to 50 full nights in a 1,000-room hotel.

Which means both sides agree there is a demand.
After 19 years, it’s hard to see this any longer as an urgent matter. And yet it’s also hard not to see that some sort of subsidy may be at hand. What it will look like, however, is hard to predict.