A resolution approving a finance plan to fund a $585 million convention center easily cleared two Metro Council committees Thursday, paving the way for next week’s definitive vote.
The nod of approval came despite continued questions over the credibility of an HVS Consulting feasibility study, a report used by project supporters — including Mayor Karl Dean — to justify the viability and financial soundness of the proposed Music City Center.
The resolution cleared the Council’s Budget and Finance Committee by a vote of 9 to 1, with Councilman Michael Craddock the lone dissenter. The council’s Convention, Tourism and Public Entertainment Facilities approved the plan unanimously, 7 to 0.
Even project skeptics say it will pass the full council Tuesday.
“Let’s don’t fool ourselves about this,” Craddock said. “This train has left the station. It’s got a full head of steam because the haves in this city want this to happen.”
Under the finance plan, a combination of taxes and fees that target tourists would over time pay off bonds used to bankroll the project. Non-tax revenue from Metro’s general fund would back up the bonds. There is also a $40 million reserve fund set aside to cover shortages. Only after that is expired would general fund dollars be used.
Prior to the vote, Metro Finance Director Richard Riebeling released bond-rating scores assigned by three different agencies, all giving the project’s two separate bond series positive marks.
He also acknowledged Fitch Ratings’ move a few hours earlier to put Metro’s existing debt on "rating watch negative," with the ratings agency’s analysts saying they might downgrade those bonds if new convention center debt is backstopped by general fund revenues. Riebeling called the move “disappointing” but said it didn’t matter much in the bigger picture.
“Is there a risk? Of course,” said At-large Councilwoman Megan Barry before voting for the plan. “But in my analysis, I conclude that the risk is manageable — not trivial, not minimal, but manageable. I see that as a risk worth taking in order to achieve the economic development outcomes that are realistically in the cards.”
At-large Councilman Charlie Tygard, who also voted for the resolution, asked his colleagues to consider the damage done by abandoning the project altogether.
“I truly believe that if we don’t build this center, two, three, four, five six years from now, our citizens will be worse off,” he said.
Still, several council members — mostly those who don’t serve on either committee — continue to voice concerns about the consulting company that conducted a report on Music City Center’s feasibility.
Councilman Mike Jameson, who earlier this week pointed out identical language used in HVS studies that deal with different cities, continued down the same logical path, this time pointing out reports on convention centers in Dallas, Kansas City and San Antonio that all happen to forecast the same number of delegates: 911,360.
Tom Hazinski, managing director of HVS, said he didn’t work directly on any studies for the cities Jameson mentioned and could not explain the oddity.
“How much are we paying you, Mr. Hazinski?” Jameson asked.
Meanwhile, Councilwoman Emily Evans alerted her colleagues to an HVS report on the feasibility of a convention center in Overland Park, Kan. The study projected a convention center room-night count that fell well short of the actual number tabulated by that city’s convention center and visitors bureau.
Hazinski said the comparison isn’t valid because the HVS study takes into account hotel-room bookings made through a wide-range of outfits. “The numbers that are counted are not comparable to what our forecasts are,” he said. “They are not apples-to-apples comparisons.”
Councilman Eric Crafton, who officially announced Thursday he plans to vote against the finance plan next week, asked Hazinski if he’s ever gone back to forecasted projects to review the outcomes.
Hazinski said he had on only one occasion, at the behest of a client, explaining it is not standard in the industry to follow up. The process of comparing actual numbers to projected ones is “actually quite involved” and time-consuming, he said.
“If you’ve never gone back and looked, how can you improve?” a bewildered Crafton asked. “How do you even know if what you’re doing is right?”