Star Time!

Is a national convention a good idea for the Twin Cities, or just its pols?

Last month, Minneapolis Mayor R.T. Rybak and St. Paul Mayor Chris Coleman appeared together at the Nicollet Island pavilion to announce their respective cities' joint bid to host a national political convention in 2008. It was the type of affair a lot of politicians relish: a public nod to the business community, a little pomp, and—perhaps most significantly—no overt element of controversy. After all, a city that hosts a presidential nominating convention is ensured four days of packed hotels, thousands of hungry and thirsty out-of-towners eager to spend money, and the pleasing glow of the national spotlight. What's not to love?

At least, that's how Rybak, Coleman, and their fellow convention boosters seem to see it. "It's very important to the mayor to get one of these conventions," says Rybak spokesman Jeremy Hanson, who cites the "gigantic" economic benefit as the driving factor behind his boss's push to land either the Democratic or Republican convention. As evidence for this, Hanson—like Rybak— references the "economic boost" of some $150 million Boston purportedly reaped when it hosted the 2004 Democratic National Convention.

Such eye-popping numbers are often bandied about in discussions about the merits of hosting a national convention. But increasingly, more city leaders across the country are casting a jaundiced eye on conventions—largely because of rising security costs, business closures, traffic congestion, and other headaches that come with the spotlight. And in the post-9/11 environment, some economists and critics now say, it is an open question whether host cities even realize an economic benefit.

"There has been very little independent, objective study of that issue," notes Steve Weismann of the Campaign Finance Institute, a Washington D.C.-based nonprofit that advocates for campaign reform. In the case of the Boston convention, Weismann points out, a study conducted by the Beacon Hill Institute at Suffolk University concluded that various official estimates of the convention windfall—which range from $50 to $154 million—were grossly inflated. After taking into account costs (including both direct cash outlays for expenses such as policing, and more difficult-to-quantify losses caused by traffic congestion and temporary business closures), the institute's researchers calculated that Boston came out ahead by a much more modest $14 million.

While the particulars are subject to debate, one fact is undisputed. When the political parties come knocking these days, a growing number of cities are saying, "Thanks, but no thanks." In the case of the 2008 Democratic convention, for instance, the Democratic National Committee invited 35 cities to bid. Eleven cities expressed interest, but only four—including Minneapolis-St. Paul—submitted formal proposals. Just four of the 31 cities invited to bid for the Republican convention, meanwhile, actually delivered bids (again, including Minneapolis-St. Paul).

Why the fading interest? According to Jack Kyser, the chief economist for the Los Angeles County Economic Development Corporation, Los Angeles demurred this year because of its experience hosting the 2000 Democratic convention. "I would say, basically, it cost more than it benefited us," Kyser says. While he did not conduct a formal cost-benefit analysis, Kyser says the disruption caused by the convention hurt a lot of smaller businesses in Los Angeles. The jewelry district, he notes, was shuttered during the convention. Meanwhile, Kyser says, security costs exceeded estimates by about $20 million and the city is still footing the bill to fight lawsuits brought by demonstrators against the police department.

As to the extravagant level of spending claimed by convention boosters, Kyser is skeptical. While hotel rooms do get filled during conventions, they are usually sold in huge blocks and, consequently, discounted. At the same time, traditional tourists—who rent hotel rooms at full rate and patronize shops, bars, and restaurants—tend to steer clear of cities during conventions. People who come to town for conventions are not typical tourists, Kyser offers, so "don't expect these people to come rushing into your stores."

In response, convention boosters typically fall back to arguing "intangible benefits" from all the national and international exposure cities receive, which—barring a highly negative event like the riots at the 1968 Democratic National Convention in Chicago—can enhance a city's reputation as a tourist destination and pay dividends in future dollars. As Rybak spokesman Hanson puts it, "You get intense media attention for a week, and it's not all about what happens inside the walls of the convention. It's an incredible opportunity to shine a spotlight on the city."

But critics such as the Campaign Finance Institute's Weismann contend that the value of such exposure is as overestimated as the supposed economic benefits. Over the decades, he points out, conventions have become ever-more devoid of genuine news content; the last nominating convention to go to second ballot came in 1952 (when Adlai Stevenson got the Democratic nod), and there hasn't even been a close vote on the first ballot since 1976 (when Gerald Ford narrowly defeated Ronald Reagan). While the conventions are now tailored almost entirely to suit the needs of television, even TV seems to be losing interest. With poor ratings, Weismann notes, the broadcast networks have steadily reduced their coverage in recent years.

The public's view of conventions as hollow spectacle may be one explanation for the reluctance of many cities to bid for them. Cost, however, remains the foremost concern. In Tampa-St. Petersburg, which is competing with Minneapolis-St. Paul for the 2008 Republican convention, Tampa Mayor Pam Iorio recently made headlines after declaring she would cap the city's spending on a convention at $1 million. Iorio issued that promise after learning that the host committee's bid proposal called for the expenditure of about $28 million from city, county, and other local governments. That number only became public after a Tampa newspaper sued to gain access to the document. (Meanwhile, two other Florida cities have declined to submit bids for the GOP convention. Orlando dropped out of the running, citing financial concerns. Miami, on the other hand, bowed out because the dates of the convention conflict with another event it hopes to host: MTV's annual award ceremony).

So how much public money will Minneapolis and St. Paul pony up in the event either city winds up with a convention? Both mayors' offices refuse to release the Twin Cities bid proposals, citing the "proprietary" nature of the information and a state law that specifically earmarks convention bids as non-public information. Greg Ortale—who is the president of the lead entity preparing the bid, the Greater Minneapolis Convention and Visitors Bureau—did not return a call seeking comment.

For his part, Rybak spokesman Hanson says it's premature to talk dollars. But, Hanson promises, the public component will only be "a fraction" of the overall tab, currently estimated at a nebulous "over $50 million." Much of the rest of the money is expected to be raised from local corporations, which receive an exemption from normal limits on soft money contributions to political parties when convention time comes.

Given the corrosive effects of such unregulated money, says the Campaign Finance Institute's Weismann, that loophole is just one more reason for smart cities to shy away from convention bids. "Some mayors may believe a convention would have great economic benefits. But I think the more important benefit for most of the mayors is being seen," Weismann adds. "If I was the mayor, I think I would have more important things to spend my money and attention on."

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