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 Philadelphia Hotels Held Hostage
by Convention Center Mess
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By Bernard Guet, July 7, 2003

During a time when the hospitality industry in Center City is in crisis, less than 200 people are holding it hostage.

Few people realize that there are an estimated 57,000 people employed in the hospitality industry in the region. About 14,000 of them work in our member hotels. Eighty percent of them live in the city and collectively paid $9.6 million in city-wage taxes last year.

Employees of the Greater Philadelphia Hotel Association members, their families and children live in every neighborhood in the city, go to school here, eat in restaurants, visit movie houses, go to shows, sporting events, and shop here. They also work here, rent rooms, arrange for meetings, parties, and tickets for shows, call limos and taxis, recommend restaurants and performing arts venues for visitors to the city and collected $79 million in taxes for the city in 2002.

Our employees range from college graduates with specialty degrees in hotel management, food and beverage, engineering, accounting, sales and marketing, to people who came off of welfare.

Yet it's fewer than 200 union positions at the Convention Center that have made it impossible to get new business here this year.  Convention sales for the next few years are bleak.

It is time to stop the political games of union against union, politician against politician and keep our people employed. Just five years ago we were enjoying a healthy average of 75 percent occupancy in our hotels. In 2003, this number is slipping below 61 percent.

Based on the 15,000 hotel rooms in the City, the loss of one housekeeper per day per 100 unoccupied rooms equals 150 fewer jobs. Some came off welfare in 2000 and are facing unemployment again.

Do the math. It is not just the housekeepers that lose their jobs.  Shifts are cut for desk clerks, bell staff, room service, cooks, front-desk managers and in the executive offices.

Center City is the engine that drives the region. What hurts us hurts entire industries: restaurants, taxis, theaters, museums, airlines, shops and other convention-service providers.

The situation is critical and needs to be dealt with in a fair but firm manner. We cannot continue negotiating. We need to move on, call our customers, and tell them that we have come to a solution and start rehiring our people.

The assessed value of hotel properties in the city is $1.3 billion. If room occupancy continues to drop, so will that assessed value.  Already several hotels have converted to other uses and if we do nothing, the future will continue to be bleak.

Room taxes support the marketing of tourism and convention to our city. It supports the Philadelphia Convention & Visitors Bureau and yes, it also supports the Convention Center.

Our employment/wage-tax contribution to the state will drop by $3.7 million; sales tax by $4.8 million; occupancy tax by $3.4 million; wage tax by $1.3 million; county tax by $800,000. What does this mean for Convention Center funding? A shortfall of millions that will have to be made up by city taxpayers.

We support the "Customer Satisfaction Agreement." It is a good roadmap toward correcting our problems. We urge all the unions to sign it.

Bernard Guet is general manager of the Park Hyatt Hotel and president of the Greater Philadelphia Hotel Association.

Contact:

Bernard Guet
Greater Philadelphia Hotel Association
http://www.philadelphiahotelassoc.org/

Also See: Lackluster Occupancy Forces Hawthorne Suites in Downtown Philadelphia to Begin Conversion to Condos / May 2003
Philadelphia Hotel Leaders Demand to Meet with Governor, Threaten Suit; Upset Over Convention Center Board Electing Leaders Who Lack Hospitality Experience / Feb 2003


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