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There is no demonstrated need to expand convention center.


THE Los Angeles Convention Center The Los Angeles Convention Center (abbreviated LACC) is a convention center in downtown Los Angeles. The LACC hosts annual events such as the Greater Los Angeles Auto Show, and was best known to video games fans as host to E3 until its cessation in 2006.  has been a financial drain on the city's precious general fund and has publicly been described as a "money losing taxpayer boondoggle boon·dog·gle   Informal
n.
1. An unnecessary or wasteful project or activity.

2.
a. A braided leather cord worn as a decoration especially by Boy Scouts.

b.
." A massive infusion of public funds See Fund, 3.

See also: Public
 to expand this facility is wasteful and counterproductive.

Yet, inexplicably, the Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850.  Convention and Exhibition Center Authority Commission, on which I sit as a current member and former president, has spent nearly $1 million for numerous studies to revise the Convention Center's Master Plan which includes an expansion of its facilities and replacing its West Hall, cost estimates commence at $750 million and rise to a staggering $1 billion.

I opposed the commission's recent vote to spend another $100,000 for further studies. None of the previous studies have concluded that an expansion is a wise investment, and no independent study has assessed the full costs, benefits and alternatives.

There is no demonstrated need to expand. The center's occupancy rate Noun 1. occupancy rate - the percentage of all rental units (as in hotels) are occupied or rented at a given time
pct, per centum, percent, percentage - a proportion in relation to a whole (which is usually the amount per hundred)
 averages only 65 percent and a glut of meeting rooms and convention space may soon be on the horizon. The adjacent Ritz Carlton/Marriott Hotel plans to have 100,000 square feet of meeting rooms, banquet halls and ballroom space. This hotel may either diminish or spur demand for convention center space, but hundreds of millions of public funds should be allocated to more certain outcomes. A possible conference center near the Los Angeles airport casts additional doubt on the need to expand the convention center.

Understandably, there is no political or public will to finance another expansion with large sums of public funds. City voters did not approve last year's municipal bond campaign to increase affordable housing and it is foolhardy fool·har·dy  
adj. fool·har·di·er, fool·har·di·est
Unwisely bold or venturesome; rash. See Synonyms at reckless.



[Middle English folhardi, from Old French fol hardi :
 to believe that taxpayers would support the Convention Center's Master Plan.

The convention center's last expansion was funded by a $500 million bond issue, with repayment promised from the center's revenues, but increased convention business and its revenue did not materialize. As a result, city taxpayers have been left holding the bag--more than $50 million will be diverted from the city's general fund to fully repay these bonds.

There are more productive uses for any additional convention center funds. The convention center spends only one-fifth of the amount our competitors spend on marketing; and only one-fourth of the amount our competitors spend on maintenance and capital improvements.

The city and the Convention Center Authority Commission have plenty of time to act intelligently and prudently--without embarking on an ill-conceived expansion. The city's rights to exercise its option on the adjacent property targeted for expansion do not expire until 2024.

The convention center is a public asset and with downtown's growth there is a great opportunity to maximize this asset. The mayor, City Council and the Los Angeles County Board of Supervisors The Los Angeles County Board of Supervisors is the five member governing board of Los Angeles County, California. Members of the board of supervisors are elected by district, the current members as of April 2006 are:
  • District 1: Gloria Molina, Democrat
 can improve the convention center without another costly publicly-funded expansion. Here are some alternatives:

* Amend the existing City-County Joint Powers Agreement joint powers agreement n. a contract between a city, a county, and/or a special district in which the city or county agrees to perform services, cooperate with, or lend its powers to, the special district.  to manage the center by one empowered commission instead of today's unwieldy two-commission structure.

* Create a public-private partnership Public-private partnership (PPP) describes a government service or private business venture which is funded and operated through a partnership of government and one or more private sector companies. These schemes are sometimes referred to as PPP or P3.  to improve the convention center's existing facilities, integrating such with the private sector's investment in the adjacent L.A. Live This article or section contains information about expected future buildings or structures.
Some or all of this information may be speculative, and the content may change as building construction begins.

L.A.
 and surrounding new residential, retail, hotel and commercial developments.

* The city may realize $200 million from the sale of air rights derived from the convention center. While expansion is presently not feasible, reserving some of these air rights would allow a future vertical use of the center. An alternative would be to dedicate a portion of the sale proceeds to improve the convention center's existing facilities.

* Negotiate a return of the city's ability to sell naming rights Naming rights are the right to name a piece of property, either tangible property or an event, usually granted in exchange for financial considerations. Institutions like schools, places of worship and hospitals have a tradition of granting donors the right to name facilities in  to the convention center which were waived to facilitate surrounding development.

Mayor Antonio Villaraigosa and the convention center's new general manager should be granted the operational flexibility to improve the convention center without the burden of servicing massive public debt while marketing additional footage that may never be occupied on a sustained basis. It is not prudent to ratchet up the public investment in a facility that has financially struggled for decades.

The mayor and others have colorfully described the convention center as a "white elephant White Elephant

Any investment that nobody wants because it is unprofitable.

Notes:
The term 'White Elephant' is derived from Thailand, where an Albino (white) elephant was given to unfavored people by the ruler.
." While it has not achieved its financial potential, needless expansion would be an exercise that defies all economic logic and description.

Wayne Avrashow is a lawyer who practices hi Encino, and he has been a commissioner on the Los Angeles Convention and Exhibition Center Authority since 1997.
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Title Annotation:COMMENTARY
Author:Avrashow, Wayne
Publication:Los Angeles Business Journal
Date:May 7, 2007
Words:725
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