The Chatter Class: City should follow conventional wisdom, begin building

This month will pass with no vote on issuing bonds for the new downtown convention center.

The talk is the vote could come up in April or May. Some call it a delay. In the Mayor's office, everything is on target and the financing will be needed to meet the land acquisition schedule this summer.

Originally, the hope had been that the bond vote would have happened in January or February. But obviously the timing wasn't right since the credit markets were still in a tizzy.

Credit markets still are tight and the Mayor’s office has been dealing with storm water and budget issues. An underwriter has been selected for the bonds, a major step toward moving forward.

The vote, however, could come as budget hearings begin and we see Metro's tight financial situation. With the prospect of more trimming, the vote likely could bring more cries from sectors of the public that believe the city shouldn't be considering construction on a $1 billion convention center and hotel when there are under-funded programs.

And this is where the legion of proponents of the convention center will need to renew their sales pitch and make seemingly counterintuitive arguments against myopic ones.

They will have to explain once again that the tax revenue generated to pay off bonds can simply be transferred to other uses in the city. Visitors pay those taxes, which are governed by state law.

Even if it wanted to, the city can't just divert that pot of money to other uses. Plus, visitors might not look too kindly on helping fund schools in Nashville when they may be coming from a city with similar issues.

Convention center proponents once again will have to fend off claims adding space here when there's overbuilding in the convention industry. Opponents also will bring up the question of why build when the convention and meeting business is struggling now.

That will lead to the position, once again, that this project absolutely will fall back on Nashville taxpayers — that there's no way that the tax revenues from visitors will cover the bond repayment. Yet, no example exists locally where the city has had to renege on such a promise on a major municipal project.

The response to all this most likely will be that Nashville has cemented its place in the national convention business as a destination and it wants to stay there. Who cares if there are other cities wanting to get into the business with convention centers of their own or others are expanding?

Proponents will note that Nashville is already there with its reputation and has a better competitive advantage. In addition, trends show that the industry revives with the economy. Videoconferencing hasn't killed the industry as had been predicted at one point. People still like to meet face-to-face when they can. Cities with a competitive edge will get the business.

Others will bring up Gaylord Entertainment's decision to put its expansion on the shelf as justification for why Nashville should do that same. Of course, that didn't stop the company from moving forward with plans in Mesa, Ariz., and voters there just approved a bevy of tax incentives for the company.

The biggest point proponents will make is that now is the time to begin building.

For starters, it could be considered a "stimulus package" of our own, one that Nashville taxpayers won't have to fund. Construction means jobs for a hard hit industry.

Secondly, construction costs are lower now because of the economy. This is where the counterintuitive thinking comes into play — begin building when the economy is down so you can catch it on the upswing.

There's talk that costs are down some 20 percent as construction companies seek jobs to keep their people employed. Materials costs have come down as well.

Locking in now could mean the convention center actually comes in at the stated price or maybe lower. It would be a miracle, for sure. But if either happened, then what would all the people say who were dead set on the opinion that the project will cost more than budgeted?

If the city had to wait until the economy improved and subsequently the convention industry's fortunes to build, then chances are city would catch the cycle in a different place and costs would be higher. That could be a surefire way of the convention center costing more than planned.