Paying Its Own Way

by Dan Richardson


Why hire dozens of staff, build many thousands of square feet and bond for millions of dollars for a convention center that would, at best, barely break even?


Because, say supporters of the convention center expansion, the project could draw in as much as $400 million in current dollars, according to a 1997 feasibility study by PricewaterhouseCoopers.


The existing convention center brings in 35 to 40 conventions each year, with about 100,000 to 150,000 guests who spend about $23 million to $25 million a year in the local economy, according to the center's annual reports from the past two years. CCX, supporters say, would triple the convention hall's floor space and, potentially, double or triple all those numbers.


Convention centers aren't designed to make money, really, but to capture sales tax dollars from visitors and to spur development, says Douglas Ducate, president of the Center for Exhibition Industry Research, a Chicago-based nonprofit group. Nationwide, most require a small subsidy, but some break even or turn a profit. Some are operated privately.


Given good air transport facilities, as Spokane has, and adequate hotel rooms (Spokane currently has a glut), "It is a good business model," says Ducate. "It isn't without risk, of course. But the industry is real strong right now... There's a temptation in this industry, I guess like any other, to chase the home runs."


But Ducate says Spokane's marketing emphasis, post-expansion, should be in attracting smaller conventions. "The numbers are in the small end [of conventions]," he says, "not the big end."


Supporters like Spokane Mayor John Powers see the potential new influx of money relieving the city's general fund, improving county facilities and boosting tourism. They have visions of 300,000 visitors a year who pay local sales taxes, eat meals out, sleep in area hotels; they see rental cars rented, airplanes touching down and taxis hailed -- and before all that, construction jobs to last a couple of years while CCX is being built.


"Whether it's cranes in the air downtown, or cranes in the air at the fairgrounds, or cranes in the air at Mirabeau Point, we are constructing important infrastructure," says Powers, eyes gleaming with promise. "Commerce is being conducted with construction. This is another example of a major step forward for the regional economy."


That's, of course, if people come. Like other industries, the convention business has its ups and downs. Stricken with a post-Sept. 11 travel malaise and a general economic slump, Spokane's convention center in 2001 dropped attendance to 100,000 from 164,000 the year before, according to its annual report.