Two recent meetings of Monroe County officials featured renewed enthusiasm to start thinking again about the convention center expansion project.
The downtown project, which Bloomington and Monroe County officials have been pursuing for a few years now, had hit yet another rough patch in early March 2020, just before the pandemic hit.
The COVID-19 pandemic effectively paused the effort, as city and county elected officials were at odds over the way members would be appointed to a yet-to-be-established capital improvement board (CIB).
A year and a half later, at the county council’s Sept. 15 hearing on the convention center budget, council president Eric Spoonmore helped put the expansion project back on the civic radar. “I don’t want us to lose sight of this very important convention center expansion project that we have promised to the community,” Spoonmore said.
Spoonmore was following up on some remarks that councilor Geoff McKim made in favor of using American Rescue Plan Act funds to cover some maintenance costs for the existing convention center. That’s a move that Spoonmore said he also supports.
The CIB is something that Spoonmore hopes to see established before he finishes out his term on the county council at the end of 2022, he told The B Square. Spoonmore announced in early July that he will not be seeking re-election to the District 4 seat.
About the convention center expansion, councilor Kate Wiltz said at last week’s convention and visitors commission meeting, “I think we’d be remiss if we didn’t start having some conversations out loud.” Wiltz is the council council’s appointee to the five-member group.
Wiltz said, “Let’s start talking about when and how we can and get started on [the convention center expansion] because the fact of the matter is, we are collecting the tax.”
The “tax” that Wiltz mentioned is the 1-percent tax paid by people on their purchases of prepared foods and beverages in Monroe County. It has been collected since early 2018 after a controversial decision by the county council to enact it.
The purpose of the tax is to support the expansion of the convention center and related economic development efforts. As of 18 months ago, the price tag for the planned convention center expansion project was around $44 million. The project is planned for the vicinity of the existing center at College Avenue and 3rd Street.
In his remarks, Spoonmore said that he now hears consistently from the business community: What’s going on with the convention center? What is the plan?
Spoonmore called the expansion a “team effort.” Spoonmore said, “It’s going to require us to work with, with our colleagues in the county, with our colleagues in the city. ”
About the talk from the county’s side, Bloomington deputy mayor Don Griffin wrote in response to a B Square question last week: “This is good to hear that we have county folks interested in coming back to the table.”
By “county colleagues” Spoonmore meant the three-member board of county commissioners—Julie Thomas, Lee Jones, and Penny Githens.
At a public meeting convened by the county commissioners in November 2020 to check the pulse of the community on the convention center expansion, Dave Warren who was a county plan commissioner at the time, talked about the potential impact of the pandemic on the convention industry.
Warren said, “We will absolutely gather in large numbers again in the near future. But will conferences and other convention center events bounce back at the same rate? Right now, I don’t think anyone can answer that question.”
Warren added, “And so it’s a good time to avoid falling victim to the sunk cost fallacy and re-examine this potential investment.”
At Tuesday’s convention and visitors commission meeting, Mike McAfee, who’s executive director of Visit Bloomington, was sanguine about the return of convention business.
He said there were some details that event planners were requesting that he figured might become part of the industry standard: color-coded wristbands that denote someone’s comfort level with hugs and handshakes; thermal cameras at entry points; rapid testing available in the facility; and ultraviolet filters for sterilization.
On the topic of the return to convention style gatherings, county councilor Trent Deckard said at the mid-September budget hearing, “This is anecdotal, but I hear it everywhere I go, whether it’s church, school, work, streets: People want to be together.”
Describing the latest food and beverage tax revenues, McAfee said August of 2021, just “crushed” the August 2019 number. The 2021 August figure was $297,340 which was about 30 percent better than the $229,573 brought in by the food and beverage tax in 2019.
It’s 2019 that is the standard of comparison, not last year, which was impacted by the pandemic.
The proceeds of the tax go to the city government or the county government based on the location of the business that collects the tax from its patrons. About 90 percent of proceeds go to Bloomington.
Another tax, which helps support the existing convention center, is the 5-percent innkeeper’s tax. The numbers reported by McAfee show that the innkeeper’s tax revenues to the county are bouncing back, even if they’re not as strong as food and beverage numbers relative to past revenues.
McAfee noted that innkeeper’s tax revenue due to short term rentals (STRs) like Airbnb and Vrbo, has shown dramatic growth since the start of the year. For the last four months, revenue from the tax due to STRs has eclipsed $50,000, which translates into more than $1 million in business.
STRs inside Bloomington are not subject to the city’s rental inspection program, according to Housing and Neighborhood Development (HAND) director John Zody.
McAfee estimates STRs to have 10-15 percent of the total lodging market share. But there’s no way to know the exact number of rentals available because the short term platforms don’t share that information.
Does the increase in STRs mean that housing options are being taken away from permanent residents and exacerbating housing affordability issues in Bloomington?
Bloomington’s director of economic and sustainable development Alex Crowley wrote in response to an emailed B Square question: “On the one hand, the inventory set aside for STR’s definitely takes some amount of inventory offline for traditional rental use. No question about that, except it’s hard to quantify the exact amount of that set aside.”
Crowley added, “On the other hand, we should also recognize that some households are able to monetize portions of their homes (and thus afford them) by putting rooms up for STR’s. Which contributes to overall affordability for the owner.”