One of my favorite random facts about the city of San Diego is that it loses money every year because of ongoing flooding of the Convention Center.
This year, the mayor proposed to pay $1.2 million on the “dewatering” of the Convention Center through a novel source: the money coming in from Measure C, the 2020 ballot measure that increased the hotel room tax in the city. The money from the tax was supposed to fund an expansion of the Convention Center, improved homeless services and road repair. For years, the city could not collect the Measure C money because of an ongoing court battle. Now, for the second year, it is collecting the tax.
The mayor also proposed that $3 million the city gave the Tourism Authority to market the Convention Center also come from the new tax.
This helped give the city’s independent budget analyst and the City Council an idea. They were scrambling to find money to restore funding for the arts that Mayor Todd Gloria had proposed cutting in his budget.
They found $6 million in Measure C.
Here’s how: The city makes payments of about $12 million per year to pay off old debt it took out for the 2001 expansion of the Convention Center.
They’re going to pay half of that with Measure C’s tax collections. The tax passed to fund a new expansion of the Convention Center is now going to actually be to pay off the one from 25 years ago. The city’s lawyers confirmed with the Council that Measure C does explicitly allow the city to use the new tax revenue for old debt. The people who came up with Measure C likely thought of that in the context of a new bond for a new expansion refinancing some old debt.
The mayor issued a statement Wednesday saying he disagreed with some of the Council’s adjustments to his budget but he would not veto them.
“Decisions like diverting Measure C funds from the Convention Center may avoid difficult cuts this year, but they set us up for the same budget challenges next year,” he said.
Councilmember Kent Lee, who helped craft the solution to help arts organizations said it’s unclear how they will come up with a new plan to expand the Convention Center again. They’ll likely need a new design or strategy or new money – the time from when Measure C passed to when collection began included major inflation in construction and other costs. For now, the city has other priorities.
“This is a short-term effort … a bridge to a long-term solution to arts funding. Maybe we move to something more regional, maybe a different source of revenue,” he said.
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