The Morning Report
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The San Diego Convention Center has $36 million in maintenance needs and no clear way to pay for it.
When the city approved plans for the Convention Center 30 years ago, officials knew things would break and need fixing. They set up a pot of money to pay for it, funneling tax dollars from hotels around the center into a special fund.
In 1994, the City Council eliminated the pot of money and directed it to the day-to-day operating budget, instead. The city promised to fund repair needs, too. But it didn’t. And now we’re here.
The Convention Center’s lost maintenance money mirrors other city decisions made over the past two decades to get cash today at the expense of a tomorrow that’s now come. Pensions and road repairs are the best examples.
Figuring out how to pay for all the things the waterfront building now needs has been at the heart of recent disputes over the center’s future and its budget. One Convention Center board member, Cheryl Kendrick, has resigned in the flap.
Kendrick had pushed for an audit to find $1 million in savings from the center’s annual budget that could be used on maintenance. But the audit’s recommendations weren’t enacted because Convention Center staff and other board members said other cuts had made the recommendations obsolete.
In 2005, the city contributed $4.5 million to the center. This year, the center gets $3.4 million. Out of that amount, the corporation spends $1.5 million on maintenance expenses and sends the rest to the San Diego Tourism Authority, which commandeered sales responsibilities as a condition for further taxing hotel guests to pay for an expansion.
But not all of the center’s current $36 million maintenance list is about fixing stuff. Of that total, $7 million comes from projects related to the expansion. The old building needs to update its carpet, sprinklers and public address system to match those in the snazzy new expanded facility.
Right now, those costs aren’t part of the new expansion’s budget. The city’s independent budget analyst has said the city, Port of San Diego and the Convention Center Corporation should consider using the new expansion money for repairs needed to make it consistent with the old building. That’s what happened the last time the center expanded.
The budget analyst also said the center should look at increasing service fees, finding new forms of revenue and continue to cut its annual operating expenses to make up for the pot of repair money that’s no longer there.