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SALT LAKE CONVENTION CENTER HOTEL Utah Taxpayers Association “Utah Taxes Now” Conference May 2013 - PowerPoint PPT Presentation


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SALT LAKE CONVENTION CENTER HOTEL Utah Taxpayers Association “Utah Taxes Now” Conference May 2013. Existing Downtown Hotel Market. 11 full-service hotels (4,800 rooms) Existing hotels entered the market with little or no government help

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SALT LAKE CONVENTION CENTER HOTEL

Utah Taxpayers Association

“Utah Taxes Now” Conference

May 2013


Existing downtown hotel market
Existing Downtown Hotel Market

  • 11 full-service hotels (4,800 rooms)

  • Existing hotels entered the market with little or no government help

  • Private investment in downtown hotels has been extraordinary—superior to other cities

  • Downtown well supplied by a wide range of hotel rooms

  • Grand America Hotel (775 rooms) is a convention hotel

  • Grand and Little America hotels have surplus capacity

  • 1,000 room convention hotel would add 21% of room inventory (full-service) to a well-supplied market


Strategic Advisory Group (SAG) estimates about $100 million (NPV) subsidy is needed to bring a 1,000 room convention hotel to downtown Salt Lake

Source: SAG, Convention Headquarter Hotel Financial Model Assessment, December 2012, pg.17


Problems and issues
Problems and Issues (NPV) subsidy is needed to bring a 1,000 room convention hotel to downtown Salt Lake

  • Unfair tax policy (how do existing hotels compete against a hotel receiving about $10 million/year in tax benefits?)

  • Approach incentivizes the subsidized hotel to take business from existing hotels

  • Public will lose tax revenue when lodging, restaurant and banquet business moves from existing taxpaying hotels to the non-taxpaying convention hotel

  • Public will lose tax revenue if a heavily subsidized convention hotel keeps taxpaying hotels from entering the market

  • A large portion of spending by delegates staying at the convention hotel would not be taxed for 15+ years

  • The approach boost convention business is not supported by Utah’s hotel and restaurant associations—which comprise 67% of convention delegate spending


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