The Kansas City Council is nearing a decision on the financing plan for a new downtown convention hotel. Supporters say the $311 million project will revitalize a moribund convention industry, while opponents believe the public risks of the project are wildly understated.
As is usually the case, reality lies between those extremes. The hotel won’t be a failure — it will open, operate, eventually make a small profit — but it won’t be a success, either.
Expanding a city’s convention business is tough. It’s even tougher in a world where video-based communication is ubiquitous and free, a threat that makes firm predictions of additional convention business laughable.
And Kansas City isn’t pursuing new visitors in isolation: other cities are building hotels and civic centers, too. The result is an unwinnable conventioneer arms race, a stalemate that leaves communities more or less where they started 10 or 20 years after breaking ground on a convention-related project.
That probably means Kansas City will have to adjust its public financing for the new hotel over the next decade or so. The new facility will open, struggle for a time, then come back to City Hall for help.
It’s happened before. In the mid-1980s, the Vista International Hotel opened to great fanfare north of Bartle Hall — and nearly went bankrupt less than two years later. It took a series of purchases, new financing and millions in losses before the hotel gained its footing as the Marriott.
Other downtown hotels have needed public support to survive.
City Hall is already helping the new hotel: about $2.4 million in the first year and escalating over time. The money will come from an exclusive catering contract for the hotel. But if that business falls short, the city will have to find additional funds somewhere else. The hotel’s backers are also getting tax breaks and other aid.
All of this frustrates the usual opponents of public largesse for corporations. Some of them may try to put the project on the ballot.
If that happens, the voters’ calculus will be difficult and interesting. It’s easy to oppose public support for the hotel in the abstract, yet killing the deal would cost at least some medium-skill jobs. Taxpayer support for the Power & Light District is a troubling reality, yet how many voters — even now —would choose to return to what downtown used to be?
There isn’t much drama as the City Council approaches its decision this week. Kansas City will soon get another hotel for its skyline, and it will struggle to breathe.