Aug. 25–The Chargers released a study Wednesday that forecast 900,000 new visitors each year to its proposed $1.8 billion stadium and convention center in downtown San Diego, boosting the region's hotel revenues by $750 million over the first decade of operation.

City government could expect an average of $12.5 million a year in higher taxes on hotel stays, said the report by Hunden Strategic Partners, a tourism economics consultancy.

"I started out as a skeptic," said Robin Hunden, the firm's managing partner, referring to his hiring by the Chargers in May to conduct an independent review of the concept. "They have a pretty sound proposal here."

"This is not going to be competitive to the existing convention center," he said. "The focus is on making the pie bigger."

The Chargers have qualified an initiative, dubbed Measure C, for the November ballot. It would increase taxes on hotel stays to 16.5 percent from the effective rate of 12.5 percent, with most of the resulting revenue devoted to building and operating a convention center and National Football League stadium near Petco Park in downtown's East Village.

A city or joint powers agency would design and run the complex. Chargers financial advisers have estimated the tax revenue would cover payments on at least $1.15 billion in public bonds, while the measure would require $650 million in private-sector contributions from the team, the NFL and fans.

Barring major cost overruns or dropoff in hotel revenues, the proposal would generate $36 million for tourism marketing. Any surpluses as room revenues grow would go to the city's general fund, the team has forecast.

Opponents of the plan declined to comment Wednesday until they had time to review the 92-page study, yet some expressed skepticism.

"My challenge to this whole proposal is there is no definition to this," said Joe Terzi, chief executive of the nonprofit San Diego Tourism Authority, noting that Measure C includes no final design or cost figure. "It's a big commitment to say, vote for this and we will figure it out later."

Terzi was influential in the commissioning of a study released Aug. 10 by the city's hotelier-run Tourism Marketing District, which forecast sharply lower revenues from new hotel taxes, just $2.3 million a year, versus the $12.5 million projected in the Chargers-funded study.

The TMD study, by consulting firm HVS, said the hybrid convention center-stadium would attract 69,000 new overnight stays at regional hotels. The figure is lower than the 225,000 "room nights" forecast in the Chargers' study, as well as 124,000 forecast in a study funded last year by the San Diego Convention Center Corp.

The 2015 study concluded that a contiguous expansion of the bayfront center was superior to construction of a separate, smaller center near Petco Park, although it said either concept could help the city's tourism economy.

In Measure C, the Chargers explicitly leave the door open to a future expansion of the bayfront center.

Hunden, in his comments Wednesday, said the TMD's study had several serious flaws. For example, his forecast assumes that a city agency would operate and market the two centers together, so that one mid-sized convention could be operating and filling hotel rooms while another was setting up or breaking down at the other center. The TMD study assumes the spaces will compete for many of the same events.

David O'Neil, an expert on tourism operations who advised San Diego on the original construction and expansion of its bayfront center, said the Chargers concept would allow the city to offer space to mid-sized meetings on nearly 95 percent of the dates sought by planners, who tend to avoid holidays, for example.

The NFL has agreed to schedule no home games on Mondays and Thursdays during prime convention weeks, a concession that will allow the new center to book 70 percent of its capacity, a figure comparable to the bayfront center that is considered fully booked by the industry, he said.

The Chargers hired O'Neil's firm, Conventional Wisdom, to consult on the convention space and study the market, a process that included surveys of major meeting planners who have chosen competing West Coast cities instead of San Diego in the past.

More cities are targeting the mid-sized meetings considered the "heart of the market" instead of giant convention space, O'Neil said. In particular, exhibitors with large equipment, such as amusement operators and public works associations, would be eager to display their rides, fire trucks and other large equipment on the stadium floor, he said.

As for the old center, O'Neil said previous studies had badly underestimated the lost revenue and disruption caused by a bayfront expansion, which would require moving loading docks and exterior walls. Besides, the city's efforts to expand the old center have been blocked in court.

Such practical and legal obstacles confer an advantage to the Chargers concept, which the team has said could be completed as early as 2020, he said.

"Every day you're open earlier, that's money flowing into the community," O'Neil said.

Hunden and O'Neil did not study the viability of the financing proposed in Measure C. That's the subject of two additional studies released this week.

On Monday, San Diego's independent budget analyst said the hotel tax increase in the team's initiative would cover the anticipated bond payments, although risks to the city's general fund would rise with major cost overruns.

More pessimistic was the San Diego County Taxpayers Association, which said the projected tax revenue would fail to support $1.15 billion in bonds, compelling the city to cover the shortfall from its general fund. Such risk to taxpayers was reduced in a deal struck by the city with the Padres in the 1990s to build Petco Park, which required the team to cover shortfalls and invest $300 million in private development.

On balance, the various studies should make voters cautious, opponents of Measure C said Wednesday.

"We have just received it, and we're interested to learn what assumptions were used to arrive at conclusions so different than four independent financial analyses of (Chargers Chairman) Dean Spanos's tax measure that all say the same thing — there is too much risk for San Diego taxpayers and the city, and if revenues do not exceed costs the city would either have to cut back on street repairs and other services or default on the bond payments," said April Boling, chairwoman of a hotelier-funded political coalition to defeat the Chargers measure.

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