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Frequently Asked Questions These are difficult economic times. Why should Nashville make this investment in a new convention center? Q: These are difficult economic times. Why should Nashville make this investment in a new convention center? A: A new downtown convention center will have a significant economic impact on our local economy. More than 3,000 construction jobs will be created during the four years it will take to build the center, and many thousands of additional workers will be required to support the project. Once the center is open and operating, it will be able to attract thousands of new visitors to Nashville each year, who will pump millions of dollars into the Nashville economy, including significant amounts each year in state and local taxes, which help keep Nashvillians’ taxes lower. Q: But why now? A: If we don’t act now, we will continue to lose conventions because of the inadequacy of our current downtown center, and we will lose this economic engine for our city. Now is a good time to begin a construction project, because costs are low. In fact, many of the most expensive materials we will need are 20 percent below their costs a year ago. If we begin now – bringing jobs to the city at a time when we need them – the new center will open in 2013, at a time when the national economy could be coming out of the current economic cycle and Nashville would be well-positioned to take advantage of our strong brand to attract visitors to our city who will contribute to our local economy in multiple ways. Q: How will we pay for the Music City Center? A: All of the revenue sources are “visitor taxes,” and five of them are already in place. They include a portion of the existing hotel/motel tax; an increase in the hotel/motel tax; a hotel room-night charge; a rental car tax increase; and an airport ground transportation fee. Once the new center is up and running, two additional revenue sources will be put in place: redirection of some taxes inside a newly created Tourism Development Zone and taxes collected on the convention center campus itself. Q: Can we finance a convention center solely from visitor taxes, when the economy is hurting and fewer visitors are coming to Nashville? A: We anticipated economic downturns when we projected how much revenue these taxes would generate. At this point the revenue streams are strong enough to support the project. Q: Will Nashville taxpayers have to pay for any of the new center? A: No. The center will be paid for out of dedicated funding sources – visitor taxes – and will not require contributions from property taxes or sales taxes paid by Nashvillians. Nashville has a 22-year track record of success in using this method and paid for the current convention center entirely with visitor taxes. Q: How much has the current convention center cost Nashville taxpayers? A: It was funded by the hotel/motel tax, which generated enough revenue to pay for the construction and operation of the center for 20 years, until the bonds were retired in 2007. Using that as a model, the Council has enacted even stronger and bigger funding streams – paid by visitors – that will cover the cost of the new convention center, so that Nashville taxpayers will not have to pay for it. Q: Gaylord Opryland has delayed its convention center expansion during these tough economic times. Doesn’t that suggest that we should consider delaying as well? A: The decision to move forward with a downtown convention center is based on a thorough and ongoing review of need, market conditions and funding options. We know that Gaylord is engaged in a similar review. We don’t know all of the factors they are considering, but we are confident that now is the time to begin work on a new downtown center. Q: Has there been adequate public discussion of this project? A: Public discussions about a new downtown convention center began in 1999. Multiple studies have been conducted, including a 16-month study by the Music City Center Committee, which made many of the recommendations on which we are now acting. The new center was a major issue in the 2007 elections, and all five mayoral candidates and most Council candidates endorsed the project. More than 100 speeches have been given over the last three years by proponents, who explained the need and answered questions for civic organizations, neighborhood associations and members of the public. During the pre-development phase, which began in February 2008, MDHA has held four, well-attended public meetings to discuss the community master plan and design for the new center, and a fifth public meeting is being scheduled. Three meetings have been held with small, minority and women-owned business owners to discuss the project, and those meetings have attracted overflow crowds. Q: What guarantee do we have that there will be at least 20 percent of Diversity Business Enterprise participation? A: MDHA has a strong track record on previous projects such as the NFL stadium that demonstrate its commitment to diversity. MDHA is very confident that the goal will be met, and plans to carefully monitor the work to make sure that there is diversity in involvement throughout. Roxianne Bethune, a very experienced professional in this area, has been hired to help oversee this effort. A Web site dedicated to Diversity Business Enterprise has been created at www.musiccitycenterdbe.com. Q: What will happen to the current convention center? A: Until the new center is complete, the existing center will operate as it always has. When the new center opens, the current center will occupy some of the most valuable real estate in Nashville, and there will be tremendous opportunity to develop something for that site that will benefit Nashville and further contribute to the local tax base. An important factor is that the Renaissance Hotel has a contract which ensures that a convention facility will continue to operate on that site for some time to come. Q: How will adding an anchor hotel affect the estimated cost? A: MDHA and the city have always considered the anchor hotel and parking structures as projects separate from the Music City Center. Financing for the hotel and parking will be handled most likely through a public/private partnership through MDHA. Q: If the Council authorizes funding for the new project, how long would it be before construction would begin? A: Once the Council approves funding, land acquisition will begin, and work on the site can begin once individual parcels are acquired. There is much to be done to prepare the site to begin building, and it will be important to communicate with the public about all of the changes that will occur. Q: What is the projected timeline of the project, from now until completion? A: Completion of the design and preparation of the site are expected to take until the end of this year, at which time construction will get under way, and we project a 36-month construction timeline. The new center should open at the end of 2012 or the beginning of 2013. Q: If we build it, how do we know that “they will come”? A: The convention market is excited about the development of the new center. Nashville’s “Music City” brand and the many downtown attractions of Lower Broadway and Second Avenue make Nashville a top choice of meeting planners, who report that the conventions they hold in Nashville consistently draw more participants than conventions in other cities. The Nashville Convention and Visitors Bureau has already secured letters of commitment from several national conventions for events in the new center. More than 100,000 hotel room-nights have already been booked. Q: How will parking around the Sommet Center and other venues in the area of the new convention center site be affected during and after construction? A: MDHA is working on a temporary alternative parking plan that will be used once construction is under way. MDHA is also working with stakeholders to come up with temporary parking solutions for events at the Sommet Center and other venues downtown that might be affected by construction. Q: Will the convention center be a “green” or LEED-certified building? A: The building will be LEED-certified and will operate as a high-performing, sustainable building. Plans also call for the building to have a “green” roof. Q: Why can’t we use this money for something else? A: Money for the project comes from dedicated visitor tax sources, enacted by the state legislature and approved by Metro Council, and can be used only for the convention center. Q: Why do we need a new convention center downtown when we have the convention facility at Gaylord Opryland Hotel? A: The two convention facilities serve very different markets. Gaylord serves the resort-type market in which everything is under one roof. The downtown facility serves conventions that seek to add value for attendees by giving them easy access to the attractions of a central tourist district. Research by the Convention and Visitors Bureau has proved that there is much demand for both types of convention facilities, and that the two convention facilities can actually complement each other. |
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