MUSIC CITY CENTER PRESENTATION TO THE COUNCIL
Remarks by Mayor Karl Dean
NASHVILLE, Tenn. (April 13, 2009) -
Aerial rendering of proposed Music City Center from southwest corner with roundabout
Vice Mayor Neighbors, members of the Council, Madam Clerk, ladies and gentlemen, thank you very much for the opportunity to speak to you this evening.
Last year this Council unanimously approved funding for predevelopment work on a new downtown convention center. Today we are nearing the completion of the project’s predevelopment phase. In a few moments, Seab Tuck with the architecture design team will unveil the Music City Center’s schematic design.
Tonight you will also hear updates from other experts involved in the project, including Butch Spyridon from the Nashville Convention & Visitors Bureau, Metro Finance Director Rich Riebeling and Phil Ryan from MDHA. But also, I would like to share my thoughts with you, as we consider how to move forward on the next phase of the Music City Center’s development.
Let me start by going back to the beginning of our city’s discussion on the need for a new downtown convention center. This discussion didn’t begin last year when funding for predevelopment work was approved, or even 3 years ago when the Music City Center Coalition was formed. This is a discussion that was started 10 years ago when business leaders in our community began to recognize that with our city’s growing attraction as a tourist destination, our existing convention facility was quickly becoming inadequate for the demands of the convention market. Over the next several years, conventions that had been held in Nashville for years started to choose other markets with larger, more functional facilities. To date, we have lost 297 conventions because our center is too small, and we have seen an erosion in the strong national convention business that we had built.
Decreased national bookings at our convention center are a concern to all taxpayers. The convention business affects our tax base. Tourism is responsible for over $100 million in direct tax contributions to our city – $100 million that goes to things like schools, public safety and parks. In fact, in 2006 a study from the University of Tennessee determined that without the contributions of Nashville’s tourism industry, every household in our city would have to pay an additional $1,029 in state and local taxes. It is one of the largest industries in Nashville, second only to healthcare, responsible for providing nearly 60,000 jobs. The 11 million visitors that travel to Nashville every year are responsible for $4 billion in direct spending in our community; and of that, over $1 billion comes solely from conventions.
This fact is indisputable: If we do nothing – if we do not build or if we significantly postpone building a new convention center in our city – the number of convention visitors, and the important revenue they generate for our city, will continue to decline. We have an opportunity to not only preserve our tourism industry, but help it grow substantially, and do so using dedicated funds from tourism-related taxes and fees. Let me be clear: This is not money that can be used for anything else. These funds come from revenue sources created specifically for this purpose. And by law, the development of a new downtown convention center is the only way that money can be spent. Most importantly, it’s non-property tax revenue.
I understand it is difficult to explain to your constituents that while departments across our government are facing budget cuts as high as 10 percent, we want to spend millions of dollars on a facility for our visitors to use. But what they must understand – what I am asking this Council to help me explain – is that this facility is a vital economic development tool for our city that our citizens won’t have to pay for, but will greatly benefit from – both during its construction and after.
This project will act as our own local stimulus package. In fact, the construction of the Music City Center will have a vastly larger impact on our local economy than all of the federal stimulus funds that we anticipate Nashville will receive. More than 3,000 construction jobs will be created during the four years the center will be built – 1,000 to 2,000 workers will be on-site each day. The vast majority of those will be local residents. And many more thousands of workers will be needed to support the project by providing services to the construction teams.
With so much business opportunity available, MDHA is committed to ensuring diversity and inclusion in this project with a goal of at least 20 percent women and minority business participation. MDHA has developed a surety assistance program and has held three contractor fairs, each drawing over 200 participants.
In 2013, after the Music City Center opens, over 1,000 more workers will be needed to staff the facility and the headquarters hotel. And the hundreds of thousands of new visitors it will draw to Nashville each year will be a tremendous boost to our economy. Those visitors will spend millions of dollars and generate many millions in additional local and state tax revenue. I am convinced this convention center will also be the catalyst for true redevelopment of our downtown south of Broadway. Fifth Avenue will become an entertainment corridor like none other, and with active street fronts on all sides of the building, we will finally see the development of our downtown stretch from the Gulch to the river and south beyond.
Since that time 10 years ago, when our city first began to recognize this need, there has been extensive study, due diligence and public conversation to determine whether or not a new convention center is really needed, and whether or not the funding for it would work. The resounding answer to both of these questions has been yes. And, as you’ll hear from others here tonight, that has not changed.
What has changed, and what cannot be ignored, is the economic climate of our day. While government should always make fiscal responsibility a top priority, in times like now, with a project of this size, we should be prudent and thoughtful in how we move forward. With this in mind, our approach is to continue working in phases. As you saw with the legislation filed Friday, the next step in the Music City’s Center development is land acquisition. In the near future, we will come to this Council with legislation to authorize the Convention Center Authority, and later with a proposal for the partner hotel. At some point this year, we will also present this Council with a final cost and financing plan for the building. A phased process is not only the right fiscal approach to this project, it will ensure this Council and the entire city is involved every step of the way.
I cannot promise this project will be completed without some bumps in the road. This is a complicated and very large transaction. But you have my assurance that as we move forward, we will do so, as we are now, in a thoughtful and deliberate way that maximizes Council input.
I have said for several years now that I believe Nashville’s best days are ahead of us. Times are tough right now. But I would argue current economic conditions only further underscore the need for this facility. This is not a sports facility we are building to entertain ourselves with. It’s an investment in our city’s future. Sometimes a city just has to have enough confidence in itself to invest in itself. I have confidence in Nashville and our attraction as Music City. And when the economy regains its momentum, and the doors open on the Music City Center, Nashville will be uniquely positioned to take advantage of the market’s growth. And it will pay huge dividends for our city for decades to come.
Again, thank you for your time this evening. I look forward to working with each of you in the days and months ahead. Thank you very much.
For more information about the proposed new downtown convention center visit www.nashvillemusiccitycenter.com.
For media inquiries contact:
Janel Lacy
(615) 862-6020
janel.lacy@nashville.gov