With a $400 million price tag, a tight state budget, and seemingly wavering support, Albany’s proposed convention center faces uncertainty
Published on 2/29/2008 by Metroland written by David King
It was something not many Albanians ever expected to hear: “In light of the challenges we’re facing, I think it’s only right we take a step back and look at this very, very closely. There are other priorities in the city.”
Albany Mayor Jerry Jennings, the man who apparently bore the weight of the convention-center project on his back for years, was quoted in the Times Union hedging his bets—shaken in his support for what some saw as his legacy project. Was Jennings’ wavering a sign of things to come for the convention center or just a bump in the road?
A funny thing happened on the way to building Albany’s convention center: The original price tag more than doubled, from around $150 million to $397.5 million. The state has allotted $205 million in state aid and tax revenue to fund the convention center; another $192 million would be needed to complete the project.
While the price tag has grown, the national and state economies have become shaky under the weight of the housing crisis. Not to mention the fact that the governor’s mansion is now inhabited by a man seemingly far less enchanted by the city of Albany, its mayor, and the proposed convention center than its previous (occasional) inhabitant.
Is it possible that the Albany convention-center project is slowly but surely becoming more pipe dream than reality? Or are the wheels that already have been set in motion unstoppable? The current battle between convention-center supporters and detractors seems to be one of legacy vs. reason, entitlement vs. foresight, and risk vs. reward.
According to Gov. Eliot Spitzer spokeswoman Jennifer Givner, the governor will not make a commitment until the project has been properly reviewed. “The governor’s office is currently reviewing the new proposal for the convention center. You’re correct. The state, as well as the nation, is facing difficult financial times and, across the board, we’re tightening our belts. It is premature to make any commitment to this project before a comprehensive review of the proposal can be completed.”
Asked to reduce costs for the project, the Albany Convention Center Authority developed new designs this year, which change the initial design for an integrated convention-center campus into a more compact form. Where the old plan included two hotels, the new one calls for a single 400-room hotel and does away with the idea of demolishing the Green-Hudson Municipal Garage. A future expansion may see the building demolished to create more hotel space.
The ACCA predicts the hotel and convention center will provide up to 800 full-time jobs, as well as the economic stimulus to create growth in retail, residential, and office space.
Though the center was proposed as an economic seed that would lead to built-in job creation, both in construction and operation, and spark business growth and revitalization downtown, some wonder if it is being sold as a cure-all for a city with many underlying problems. Albany Common Councilman Dominick Calsolaro wonders how the current design for the center could reinvigorate Albany businesses if visitors never see them. “When they showed the new proposal for the convention center, the guy that was up there doing the PowerPoint was saying . . . ‘a person is going to be able to drive in, get off the highway into the parking garage, go from the parking garage to the hotel, to their room, take their coat off and leave it in their room and never have to put it back on till they go home.’ ”
Calsolaro likens this to the Empire State Plaza, which, he says, keeps thousands of state workers stashed away from the city during the day only to expel them to their suburban dwellings via I-787 each night before they’ve ever smelled Albany’s tulips.
In his March 2006 Metroland article “Convention Wisdom,” Rick Marshall detailed how Heywood Sanders, professor of Public Administration at the University of Texas, uses Albany as an example of a city where politicians tout massive public works projects as one-fix solutions that fail. The Empire State Plaza is his favorite example.
Said Sanders, “Sadly, Albany has become the model that I share with my students of what happens when the public sector thinks one huge construction project is going to solve all of the city’s ills.”
Calsolaro thinks that, thanks to the new, more contained plans, the comparisons between the Empire State Plaza and the Albany Convention Center are becoming increasingly apt.
“Everything is going to be connected. How is that going to be an economic driver for downtown Albany?” asks Calsolaro. “Everything is self- contained. There is a walkway to the Times Union Center, and that already has a walkway to the Empire State Plaza. So if someone comes to Albany for a three-day convention and they go to the state Capitol and meet with the legislators and go to the state museum, they will never once have to set foot on a city sidewalk.”
Duncan Stewart, executive director of the Albany Convention Center Authority, acknowledges Calsolaro’s concerns about the design of the center but insists that they are taking those concerns into consideration as they move from their planning phase to actual operation.
“We initially heard from the downtown BID a year ago, ‘Don’t build a self- contained structure. Build something open to the street. Don’t lock people in, don’t provide every creature comfort.’ We heard that. But there is the reality of upstate winter and the idea of connections to the Times Union Center and the hotel are very important, because people have to come and go with some comfort. But by not having a city contained in the walls of the convention center we ask people to go out and enjoy the city. We cannot build a Mall of America concept where people enter and never need to leave.”
But Calsolaro worries that, if the designs stay as they are, remedying the problem later will be more than difficult. “If that’s the way you are doing this thing, you are making the same mistake they made with the Empire State Plaza. It’s a fortress, a self-contained fortress that precludes state workers from going out to downtown. There is no direct access out to go to the city’s restaurants. And they built restaurants inside the plaza so they wouldn’t have to go on city streets. They didn’t have foresight to see that by keeping 10,000 state workers inside they are not going out to buy lunch or newspapers.”
Taking in the plans: Common Councilwoman Carolyn McLaughlin and others inspect the proposal.
Assemblyman Jack McEneny (D-Albany) is unwavering in his support for the project and his certainty that the convention center will be built. In fact, McEneny insists that he has received indications from Gov. Spitzer that he is committed to the project. According to McEneny, the convention center is something the state owes its citizens, and something that any capital city should have. McEneny says it’s time people start thinking about the convention center not in terms of Albany, but in terms of the state.
“The question is, do 19 million people in the state of New York need and deserve a convention center in their state capital? It is very important to me that we become the political hub of New York,” McEneny says, adding that people comment on the fact that the governor and attorney general are never in Albany, and that fund-raisers are held in New York City. He says that this detracts from Albany’s standing as New York’s capital city.
“When politicians are out of town you don’t get that normal give and take,” he says. “You don’t get to know people and faces, and it is a very important thing for a capital of 19 million people. We have to move out of the mentality of how the convention center affects this ward or that, or this city or that municipality and even the Capital District, and have to say, ‘What should a state capital be?’ It is important for significant groups to be able to meet the Legislature and place their demands on state government.”
McEneny insists that the convention center in the Empire State Plaza is simply inadequate for the kinds of groups that want to lobby the Legislature, and that the Times Union Center is ill-equipped, lacking the infrastructure of individual break-out rooms and workspaces.
Calsolaro, however, says that he is suspicious of the claims that state lobbying groups will be enough to keep the convention-center hotel full. Calsolaro thinks groups from in-state might find it just as easy to carpool into town for a convention and drive back home, or to stay at cheaper hotels outside the city for a night and drive back into town.
McEneny dismisses such criticism. “When you hear criticism of the convention center,” he says, “either positive or negative, you have to ask yourself, what is their experience? Do they know what they are talking about?” McEneny points to recent letters of support in the Times Union from John Giordano of Plaza Meetings and other local business people as credible sources. “Not because they stand to profit,” says McEneny, “but because they know what they are talking about.”
McEneny says that he has heard from many state organizations that they want to meet in Albany. “I know a number of groups across the state never stop in Albany because we don’t have the facilities. When was the last time you saw the CSEA, PEF, or United Teachers having a convention here? If these aren’t the captive audience who should show up once every three or four years, I don’t know who is! I’m told their members complain, ‘How come we don’t meet in the capital?’ And they don’t, because there is no facility for them. They come here to learn, but also to intimidate. They like to call the bluff of the state commissioner with a policy that doesn’t serve them, and [the commissioner] says, ‘Sorry, you’re out in Syracuse.’ But it’s kind of hard to say no if you are up the street from them.”
McEneny’s insistence that the convention center will not be a burden on the city of Albany irks Calsolaro. Currently, profits from the convention center hotel are scheduled to be used to pay interest on construction bonds. If the hotel does not perform up to projections, portions of the PILOT funds (payments in lieu of taxes) of $232 million scheduled to be made to the city until 2033 could be used instead to make the bond payments. McEneny and Stewart both insist that projections indicate that the estimates look good. Calsolaro, however, says that if Albany loses the pilot payments to pay off convention- center bonds it will be devastating for the city, because the city will be burdened with providing services, such as policing and street maintenance, to the convention center. McEneny, on the other hand, insists that the city is not at risk of losing money to the convention center.
Stewart says that “a convention center is a piece of infrastructure that is not built to create funds itself, but to be a benefit to the patrons of the city or state, and to boost commerce around it.” But as can be seen from even a brief study of convention centers around the country, a convention center that does not draw as many people as predicted can just as quickly function as a drain on an already beleaguered city. One example is Myrtle Beach, S.C., where an underperforming convention center ensured that the hotel there could not make bond payments to the city. The city defaulted on its construction bonds, and taxes quickly were raised on hotel rooms and meals, thereby forcing restaurants and surrounding hotels to reduce prices and, in some cases, close.
But don’t mention the numerous convention centers and convention-center hotels around the country that have been performing significantly below their expected numbers to McEneny; he doesn’t want to hear it. “I get very frustrated when Dominick [Calsolaro] goes on Google the night before a meeting and tells me San Diego is building its third one, or look at Charlotte [N.C.], because it was built for so much cheaper. I want to be compared to Hartford [Conn.] and Providence [R.I.], because they are brand-new and state capitals, and because they have union labor and they have high energy costs. I think that is important.”
Stewart agrees that better comparisons would be Hartford and Providence. Stewart solicited expertise from the people who run the convention centers in those cities, who advised the Albany Convention Center Authority not to cut corners and to build to industry recommendations.
“There are two ways a convention center could lose money: direct and indirect,” explains McEneny. “Indirectly, there is no way it is going to lose money with increased bed tax, sales tax, reduced dependency on unemployment and public assistance; there will be a tremendous economic spinoff. The direct, however, often shows a deficit. But in Providence they built a hotel next to the convention center that everybody assumed was gonna be a loser, but it did so well they sold the hotel to the private sector and paid off all the bonds. And what are they doing? They are expanding.”
Stewart admits that Albany is not a super tourist destination like Las Vegas, which sees convention centers operating at a profit, but he says as a capital city, Albany has the built-in base it needs to properly support a center. “Do I feel the state, municipal and civic sector is our bedrock? Absolutely. We have a niche as the capital city. That is why we are compared to Hartford. Is the convention-center business a mature business? Yes. It is not growing by leaps and bounds by any means, but it is steady, and when you have the advantage of being a capital city it’s a tremendous back wall.”
Stewart says that despite the fact that he operates under the direction of the state, he feels it is important that the ACCA operates as if Albany were its main customer. Stewart says he sympathizes with Jennings’ statements that perhaps there are other, greater priorities in the city, and says the convention center is certainly not a cure-all. But Stewart says he will work to go ahead with the project as long as there still is support within the city and the state.
“What I can say is that being an urban mayor has to be one of the hardest jobs in the United States,” he says. “When you are dealing with aging infrastructure and dealing with the need to bring in new business and balance that with additional residential opportunities and the traditional problems of transportation and parking, it is one of the most difficult jobs anyone could take on. I could understand the mayor would say there are priorities city needs to consider. But we are here to help. We take direction from the state. We are a state convention center, but when I say the city is our customer I mean we have to be respectful of the fact that we are building within the city of Albany, and we need to work as cooperatively as we can to maximize the benefit to the communities of Albany. We are not ignoring our responsibility to develop a community-benefit program, one that can benefit as many of the people in Albany as possible and address some of these priorities Mr. Jennings has.”
The ACCA will go forward and present its board with its Draft Generic Impact Statement and State Environmental Quality Review report tomorrow (Friday). Stewart says he is unsure when a decision will be made on funding, but he says work could be started without knowing exactly where the missing $192 million is coming from.
“Provided support at the city level is still there, as the city is our important customer, the next step will be for policy makers at a state level to make a decision to go forward even though we might not have all of the financing in place,” he says. “At this point, we do have enough financing to continue to advance the project through money from the Empire State Development Corporation. That would be enough to begin design, and perhaps progress into land ownership and ultimately into foundations, before we would need additional money. We would need a decision on several levels, but if the decision is made to advance the project, financing can come in after that.” Stewart says studies have indicated that the cost of the $397.5 million convention center will increase by $40,000 a day if construction does not begin by June 30 of this year.
Calsolaro says he is horrified by the idea of starting construction before knowing where all the funding is coming from.
“Until we find out where the money is coming from, this project should not go forward,” he says. “If you start it, then we are stuck. They said we can do it in phases. As we have the money, we can complete different parts of it. But that is a good way to screw the taxpayers, because you put 10 million in and then 20 million, and you say we can’t go back because we already put this much in. They need to say where the money is coming from.”
Calsolaro says the ACCA board should recommend to the state that the project not go forward until the rest of the financing is secured.
And then there is the Rebuild Albany Authority, Calsolaro’s alternative to the convention center. Calsolaro proposes taking the grant from the Empire State Development Corporation and dedicating it to the Rebuild Albany Authority, which would use the money in a revolving-loan fund for businesses and property owners to refurbish and invest in their community. McEneny says this could never happen and would never be funded by the state, because it would subvert what the money was intended for.
“I’m not saying we should give the money to the city,” says Calsolaro. “My proposal is to set up another state authority or amend the Albany Convention Center Authority, make it the Rebuild Albany Authority. It would still be a state authority. The money would not come to the city—that is the whole point—and I don’t know if Jack [McEneny] does not want to hear me or if this is how he is trying to get around what I am saying, but there are lots of authorities in the state in the law that are specific to certain regions.”
McEneny says critics who say that if the city needed a convention center the private sector would build one are off-base. “The private sector does not take risk,” he says. “The private sector would find some open space out in the suburbs and build the best suburban-sprawl convention center they could. They have fewer hassles, and I think in the long run it might not be that successful. I remember years ago I went down to the convention center in New Orleans. God, what a disappointment! It was built on the old stockyards. I never saw New Orleans. I think today people understand just how bad sprawl is, and it’s harder to build in a city that’s nearly 400 years old—more complicated. But one of the qualities government should have is a sense of stewardship, and stewardship and Wall Street don’t go hand in hand. And the government has to do something.”
Calsolaro says, in this case, he is not sure the government of New York can handle the job. Calsolaro points to Schaumburg, Ill. (a community of 75,000 just northwest of Chicago), which began planning a convention center around the same time as Albany. That city’s 500-room Marriot hotel and 100,000-square-foot exhibition hall, with 48,000 square feet of meeting-room space and a 28,000 square foot ballroom, has been open since July, 2006.
“Schaumburg has already opened up their convention center,” says Calsolaro with exasperation. “We have been talking for three years now. Their studies were done by the same group, and it has already been open for two years. We don’t even own a piece of dirt. Talk about New York state’s dysfunctional government! You have two communities doing the same the type of project, the same size and square feet, and theirs has already been open for two years and ours is still in the planning stages. We don’t even have a shovel in the ground.”
Published in Metroland, February 28, 2008
Three issues to weigh before expanding landfill
The News - Landfill
Written by DOMINICK CALSOLARO
Saturday, 17 March 2007
Opinion Section, Times Union
By DOMINICK CALSOLARO
First published: Sunday, March 18, 2007
First, establish a regional landfill authority to replace the Capital Region Solid Waste Management Partnership (the current name for the ANSWERS consortium, though many still call it ANSWERS). The partnership includes 12 municipalities that dispose of trash in the landfill. No single member of the partnership should be totally responsible for providing and managing the landfill, nor should it be the sole recipient of any financial benefit derived from landfill operations.
There are at least 16 solid-waste management authorities and/or resource recovery agencies established under that law. Many of them include multiple municipalities, just like ANSWERS. Creation of a Capital Region Solid Waste Management Authority would have many advantages over the present system.
A regional authority would help to rectify the Department of Environmental Conservation's misguided approval first of the Greater Albany Landfill and then of numerous expansions in the environmentally sensitive Pine Bush Preserve. It could find a suitable place somewhere in the larger ANSWERS consortium land area to site a landfill.
Second, consider the landfill's economic impact. Albany has grown dependent on landfill revenue to balance its budget. If that is one reason the city is requesting the landfill expansion, then DEC should require an economic impact study be undertaken as part of its process. The economic impact of tourists coming to the Capital Region to visit the sand dunes and scrub oak, possibly see a Karner Blue butterfly, or just enjoy a hike in a nature preserve must be studied against the "profit" the city says it makes in operating the landfill.
The landfill's life could be extended by better enforcement of the city's present recycling regulations and increasing the types of plastic that must be recycled. It also could be extended if more items were salvaged for reuse, rather than just dumped. Both recycling and reuse would reduce the amount of trash the landfill must handle.
These are all issues the DEC must consider before any further expansion of the landfill is allowed to go forward.
Dominick Calsolaro represents the 1st Ward on the Albany Common Council.
All Times Union materials copyright 1996-2007, Capital Newspapers Division of The Hearst Corporation, Albany, N.Y.