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SALT LAKE CITY — Taxpayer money could be used to fund a privately-owned convention center hotel in Salt Lake City.
Lawmakers are weighing the pros and cons of the idea this week. There's a significant amount of momentum in favor of the project since the payoff is being forecast as "significant."
The state is the first piece of this puzzle — asked to put up a hefty amount for something that could pay back hundreds of millions of dollars over the next 30 years.
Actually most of the competitor cities to Salt Lake have this convention center hotel already, so Salt Lake is kind of behind the curve on this.
–Jeff Sachs, Strategic Advisory Group
The Salt Palace has expanded over the years to accommodate a growing number of events and conventions. The facility is widely regarded as impressive. It has most elements most convention organizers want, with the exception of one — a large companion hotel nearby.
"They're missing the big hotel — I like to use the term ‘laminate' — up to the convention center," said Jeff Sachs with the Strategic Advisory Group.
Utah Veterans Affairs director Terry Schow discovered the problem when he tried to lure a disabled veterans convention to Salt Lake last year. Thousands of convention guests went elsewhere as a result of the hotel issue.
"You don't have a convention center large enough, tied to a hotel, so that our veterans with wheelchairs and walkers and such don't have to go out in the elements," Schow said.
It's that lost business — at least 27 lucrative events worth millions of dollars last year alone — that is the motivation behind SB267. The project would get off the ground with $32.8 million in state money, and eventually city and county cash would match it. Private investment of at least $235 million would round out the project.
Supporters said profits from the hotel would pay down the debt over time.
They also said the economic development advantage would pay well beyond that.
At the end of the day, this is not what taxpayers should be paying for. There are basic government services that need to be taken care of, whether that's roads or other kinds of infrastructure.
–Royce VanTassel, Utah Taxpayer Association
But not everyone is thrilled about taxpayer money being used at all for such a for-profit project.
"At the end of the day, this is not what taxpayers should be paying for," said Royce VanTassel with the Utah Taxpayer Association. "There are basic government services that need to be taken care of, whether that's roads or other kinds of infrastructure."
But consultants have found that such funding schemes are a business reality in 2013.
They argued Salt Lake City will continue to lose business to other cities that do have the facilities convention organizers want.
"Actually most of the competitor cities to Salt Lake have this convention center hotel already, so Salt Lake is kind of behind the curve on this," said Sachs.
Several possible sites for the hotel are being discussed, but specifics will wait until funding is secured. Officials will aggressively seek a location as close to the Salt Palace as possible.
A Senate committee passed the bill Tuesday evening, despite lengthy testimony from those against the plan.
