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EDITORIAL: Kansas Citians Once Again Debating How Much Public Money
Should be Funneled into Helping Build a $300 million, 1,000-room Downtown Hotel

The Kansas City Star, Mo.McClatchy-Tribune Regional News

May 16, 2010--On Jan. 7, 1982, Kansas City reached a crucial point in its race to build bigger, better downtown convention facilities.

After months of setbacks, United Missouri Bancshares Chairman R. Crosby Kemper announced that a $53 million funding package -- including millions in public funds -- had been cobbled together to build the Vista International Hotel. Mayor Richard L. Berkley hailed the progress toward a 600-room, first-class hotel on 12th Street near Bartle Hall.

But even with that victory in hand, other people already were campaigning for the next costly convention attraction.

"I think the (Vista) project ought to go hand-in-hand with an expansion of Bartle Hall," William Speidel, managing director of the Radisson Muehlebach Hotel, told The Star that day.

Almost 30 years later, Kansas Citians again are debating how much public money should be funneled into the convention business.

Convention planners and the hospitality industry want more. Yet local residents have spent hundreds of millions of dollars on meeting spaces, hotels and entertainment venues in the last three decades.

With all that public investment, the goal has always been to reach a point when the private sector would be willing to invest more heavily in the future of downtown and the convention business.

The next test soon will be here.

By the end of this month, City Council members expect to receive more precise information on how much it could cost taxpayers to help build a 1,000-room downtown hotel.

Promoters argue the hotel is desperately needed to attract larger conventions, create hundreds of jobs and bolster the city's hospitality industries.

So how generous should the council be with taxpayer funds for the $300 million hotel?

Given the history of Kansas City's extraordinary support for all manner of convention facilities, the new hotel should rely heavily on private funding, not the public purse, for its construction and operation.

Since the Vista project moved forward in 1982, residents have backed many worthwhile projects. They have helped revive downtown (the Power & Light District), given the city a successful new arena (Sprint Center), upgraded the Truman Sports Complex and expanded Bartle Hall more than once.

All the projects have been backed by large contributions of public funds.

--The restaurant tax has doubled from 1 percent in 1990 to 2 percent today.

--The hotel tax has increased more dramatically, from 3.5 percent in 1990 to 7.5 percent today.

--New fees on hotel rooms and car rentals are financing a large chunk of the Sprint Center debt.

--Taxpayers are funneling millions more than ever expected into paying for the debt issued to build the Power & Light District, with $10.8 million set aside in the current budget year.

--The sports complex improvements required a sales tax increase from Jackson Countians, after bistate voters rejected a smaller tax.

--Millions in public funds have been used through tax increment financing plans to support several downtown hotels. In addition, a general fund subsidy that has topped $1 million a year has helped keep the doors open to the Kansas City Marriott Downtown. That's the old Vista hotel, which for many years after it opened in the mid-1980s lost money, sparked legal battles and finally went through ownership changes.

Of course, other U.S. cities also have been extremely aggressive participants in the race for conventioneers' dollars. That has kept the pressure on Kansas City to react, especially with more funds to support downtown amenities.

In tough economic times though, the City Council needs to be cautious in moving forward with a new, heavily subsidized downtown hotel. The elected officials will have to provide plenty of proof that more tax revenue is justified and essential to ensure success downtown.


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