Saturday, August 18, 2012

An inside look at city's conventions business

Most cities would gladly trade places with Charlotte as it prepares to host the 2012 Democratic National Convention.

As conventions go, Democrats and Republicans are in a class of their own. Probably nothing outside of the Olympics matches the spectacle, prestige and millions of dollars in federal funds.

A special report that begins today is not about that kind of convention. It’s about the more modest conventions that typically come to the Charlotte Convention Center.

You will learn what taxpayers invest to lure these conventions here. What our community gets in return. And what kinds of conventions we can expect in the future, with or without the DNC coming to town.

 Why are we telling you this now, with the city’s biggest-ever convention on deck? We think it is valuable context.

 The DNC is a great achievement for Charlotte. Still, we found little evidence that it opens a new era for mega-conventions in our city.

 Yes, we got this in part because we were ready. But more critically, it was our election year to be swing state.

 Putting politics aside, our convention business is a different story. And as you will read today, some of that story even surprised city leaders.

    For example, you and I pay a 1 percent tax to support tourism each time we eat in a restaurant in Mecklenburg County. Most of the money raised contributes to the $30 million annual cost of the convention center.

    What percentage of Charlotte’s hotel rooms would you guess that the convention center fills annually? No one we asked on City Council even came close. (Answer is in chart on 1A of Sunday's newspaper and here on

    Observer city government reporter Steve Harrison didn’t know either a little over a year ago as he broke stories about the questionable management practices of Tim Newman, the former director of the Charlotte Regional Visitors Authority. That reporting contributed to Newman’s demotion and eventual departure from the agency.

    By then, Harrison was digging deeper into the CRVA’s financial reports. He found records of payments to organizations that held conventions here: The American Legion, the American Bus Association, the Shriners, the National Rifle Association. It puzzled him.

   “When you get married, if you rent a facility, you pay them,” Harrison told me last week. “This was the opposite. (CRVA officials) were writing checks to get people to show up. I wondered, why is that? And is it worth it?”

    Harrison then did something rare, if not unprecedented, in Charlotte. He did the math on the convention business.

    What he found throws into question the whole philosophy of putting most of your tourism dollars into an exhibition hall.

    “If you want to become a bigger tourist destination, the road doesn’t necessarily run through a convention center,” Harrison said.

   On Tuesday, Part 2 will detail one reason why this philosophy went unquestioned for so long. For years, the CRVA turned out statistics that often made these conventions look more lucrative than they were.

   The CRVA now has a new chief, Tom Murray. Following discussions with the Observer, Murray put into place new formulas that provide more realistic economic estimates.

   Murray also told the Observer that he and his staff are committed to a standard of “ethics beyond reproach.”

  The new economic estimates may not be as impressive. But at least we now know better where we stand.

Every year, restaurant and hotel taxes in Mecklenburg raise more than $50 million to help grow tourism.

   If we want that investment to pay off, we first have to know what's really working.


Wiley Coyote said...

The convention business has been drying up for years.

Too many cities vying for fewer and smaller conventions.

Throw in the fact that Charlotte is not a destination city, despite getting the DNC, adds to the problem. Politics played a big part in getting the convention as was mentioned above.

The associations who look for convention sites also look for concessions and deals from convention services companies and related businesses. Most bid their conventions out on multi-year contracts and those convention services companies follow them each year if the destination changes.

Concessions to get conventions to come here is part of the process, but it has to be transparent and worth the spend in the long run.

My company has stopped doing conventions in our industry because the customers we want to see stopped allocating funds for their employees to attend.

I also worked for a convention services company for three years, working with the Charlotte Convention Center, Merchandise Mart and the other venues around Charlotte.

I can tell you from my experience, every single person at the Convention Center and other venues were professional and great to work with...

Anonymous said...

Kudo's to Steve Harrison and the Charlotte Observer for shining the great sanitizing light of exposure on this issue.

There are so many more topics to explore er, I mean expose around here..... where to begin, where to begin.