KSMU's Michele Skalicky talks with Jack McGee, government affairs reporter for the Springfield Daily Citizen, about the proposed hotel/motel tax increase that will go before Springfield voters on November 4. You can read McGee's recent story on the ballot measure here.
Springfield voters Tuesday will decide a hotel/motel license tax to help pay for a convention and event center estimated to cost $175 million. Jack, who will pay that tax if it passes?
McGee: Well, there's really three main revenue sources at this point for the convention center. There's a possible $30 million state budget earmark that is still restricted as of now but could be released at the governor's discretion. A $30 million local match that comes from the 1/2 cent portion of the 3/4 cent sales tax that voters did approve last November and then much of the remaining cost would likely come from a potential increase to the hotel/motel tax, which voters are considering here next Tuesday.
You talked to members of the Springfield Hotel Lodging Association, which endorsed the tax. What was the vote?
McGee: The vote was 23 in favor, eight against and one abstention, but the caveat is that the association policy grants one vote per lodging facility. So some of those owners that have multiple hotels in their portfolio have more votes. So the 23 votes in favor, which contributed ultimately to the association's endorsement of the tax measure, came from only two hotel owners.
And you talked to to both of those. What did you hear from Gordon Elliott with Elliott Lodgingabout the vote makeup and about what his thoughts are on the tax?
McGee: Yeah. Gordon Elliott, as you said, he was one of those two hotel owners that were in favor of the tax. And while he obviously was supportive of it, he did have some reservations. His big concern was he doesn't know exactly what would happen if the state budget earmark doesn't come after the convention center is funded in terms of where that money from the hotel tax would go either if the convention center project doesn't come to fruition or once it does come to fruition and after it's funded. But like I said, ultimately he was supportive of it. He said that he believes it will be good for Springfield.
You talked with those who didn't vote to endorse the tax — members of the the Hotel Lodging Association. What did they have to say?
McGee: Yeah, I spoke with Greg Walker of Walker Hospitality Group and Lonnie Funk with Rolling Oaks Hospitality. Both of them ultimately did not vote to endorse the tax measure within the association. They weren't necessarily against the convention center project itself while they were opposed to the tax, but they indicated that they feel that the convention center project in its current form, perhaps the scope is too large or that they don't feel enough vetting has been done up to this point, and they would like to see more research done before concrete plans are put in place.
You also talked with Tim O'Reilly, who voted to endorse the tax. What were his reasons for doing so?
McGee: Yeah, Tim O'Reilly, he was one of the two. Him and Gordon Elliott who endorsed the tax. And Tim owns — his company O'reilly Hospitality Management owns a convention center on the north side of Springfield, and he does not feel, as the report suggests, that this new convention center, if constructed, would necessarily put him at a competitive disadvantage for tourism meetings and people visiting Springfield. And he thinks that what the Hunden report recommends in terms of a convention center is in line with what he's seen and what he's participated in in other communities that his hospitality company has property in.
City officials and the Springfield Chamber of Commerce, of course, support this hotel motel tax. The chair of the chamber's board, Bob Helm, said in the endorsement announcement that, quote, the chamber believes this investment will generate long term benefits for businesses, residents and visitors alike. And approving this ballot measure ensures Springfield is ready to seize this opportunity. And then, of course, this project is based on that funding report, which showed that a convention center here of this size would be profitable. Can you tell us more about that and the reasons why the chamber and the city want this to happen?
McGee: Yeah, a lot of their confidence in this project is is rooted in that report, which was conducted by Hunden partners, a tourism consultancy firm based out of Chicago. They've done multiple reports for the City of Springfield in the past, and they've all recommended convention centers, to my knowledge. But this latest report projects over $1.3 billion in new revenue over the next 30 years, as well as over $60 million in state tax revenue and over $60 million in local tax revenue. So looking at this report, they feel that it would bring a lot of new business and investment to Springfield. Critics do caution that these feasibility studies can be overly optimistic in their projections. And the study acknowledges that macroeconomic conditions could ultimately influence whether the projections ultimately come to fruition.
