Meetings & Conventions: Newsline
MUNICIPALITIES PAY THE PRICE TO BUILD CONVENTION
HOTELS
More Cities Fund Hotel Projects
Public entity number one: Chicago Hyatt McCormick
Place
In an effort to compete with other Texas
cities, officials in Fort Worth announced in September plans to
spend $130 million on a publicly owned, 600-room convention center
property. Set to open in 2006, the hotel likely would be run by
Hilton Hotels Corp. The move has become increasingly common as
frustrated city officials, tired of waiting for private developers
to build costly headquarters properties, are opting to fund
projects themselves (Houston and Austin already have publicly
financed hotels). “It’s difficult [for private developers] to
finance these $200 million to $300 million properties, because
banks are looking for 40 to 50 percent equity,” said Reint
Reinders, president and CEO of the San Diego Convention and
Visitors Bureau, where talks are under way to build a publicly
subsidized hotel near the convention center. In other cities:
• After a series of delays from a private
developer, Los Angeles voted in May to create a nonprofit
corporation to issue tax-exempt bonds for a $280 million,
1,200-room convention center hotel.
• Up for consideration this month in
Pittsburgh’s state legislature is a 3 percent car-rental tax that
would fund a new headquarters hotel.
• In April 2002, after three years of
private-sector financing problems, Denver decided to build a
city-owned, Hyatt-managed convention center hotel by early
2006.
Elsewhere, cities are claiming success. The Chicago Hyatt
McCormick Place has posted profits since opening in 1998, according
to the Metropolitan Pier and Exposition Authority, the public
agency that owns the hotel and the convention center.
But for a number of reasons, cities must walk a fine line when
providing public funds for what are typically private enterprises.
For example, the Fort Worth deal spurred complaints from hoteliers
who fear a tax-exempt facility would be able to undercut area room
rates.
Others argue cities should not expose themselves to such
financial burdens. “Cities aren’t in the business of being hotel
investors,” said one industry consultant who asked not to be
identified. “It’s problematic when the private investment market
determines the project is not feasible, and the municipality moves
ahead with it anyway.”
• BRUCE MYINT
What Association Executives
Earn
The gender gap in earnings grows in relation to size
of organization, according to a 2001 compensation survey.
Male CEOs
Female CEOs
Trade association
$136,775
$92,125
Individual membership association
$139,241
$85,204
Total staff size:
2 or fewer
$75,000
$60,000
3 to 5
$95,640
$77,000
6 to 10
$116,550
$108,000
11 to 20
$138,200
$126,000
21 to 50
$201,923
$159,280
51 to 100
$237,900
$145,518
More than 100
$287,600
$249,233
Total annual budget:
$300,000 or less
$67,600
$54,789
$300,001 to $500,000
$75,600
$68,579
$500,001 to $750,000
$90,000
$72,800
$750,001 to $1 million
$102,000
$87,525
$1,000,001 to $2.5 million
$118,800
$112,425
$2,500,001 to $5 million
$170,000
$137,100
$5,000,001 to $10 million
$227,750
$160,585
$10,000,001 to $15 million
$225,994
$171,750
More than $15 million
$285,000
$256,269
Source:
American Society of Association Executives
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