QUESTIONING AUTHORITY
With the Legislature scrapping over funding for everything from roads to higher education, the people in charge of attracting tourists want to expand efforts to find new visitors to support the local economy.
The Las Vegas Convention and Visitors Authority, the largest agency of its kind in the country, projects its revenue will grow 7 percent in the upcoming fiscal year to $285 million — with a portion of the increase going to boost its international marketing efforts.
About 80 percent of the agency’s money comes from its slice of hotel room taxes in Clark County, which will amount to about $227 million in the 2008 fiscal year, a 7 percent increase from the current year.
The authority, which markets Southern Nevada tourism and operates the Las Vegas Convention Center, says money flowing into its coffers is an important investment considering two-thirds of the local economy is generated directly or indirectly from visitors.
Critics of the authority say the tourism agency has grown too large and that it uses tax money to duplicate work Southern Nevada’s resort operators are already doing.
The public will have its say May 17 during a hearing before the authority’s board of directors’ scheduled vote on whether to accept the projected budget.
“Our budget increase is 2 percent for expenditures,” said Vince Alberta, spokesman for the authority. “That is a very fiscally responsible approach.”
Part of the increase, about $1.9 million, is in services, supplies and salaries in the marketing department, much of which is slated for increasing overseas marketing for tourism and trade shows.
The authority is also seeking to add 37 positions, 17 of which would be part of a new graveyard shift at the convention center. The graveyard shift will include maintenance workers who will do upkeep on the building without interfering with trade shows at one of North America’s largest and busiest convention centers.
If the board approves the positions, the authority w ill have a staff of 574 people.
If approved, it will be the third consecutive year the authority has added staff.
The increase, as well as the authority’s growing budget, has caught the attention of critics who say much of the money could be better spent on projects, such as road improvement.
Bill Weidner, president and CEO of Las Vegas Sands Corp., said the authority has outlived some of its usefulness considering a number of resorts in Las Vegas have the capability and facilities to attract large conventions.
“We figure out a formula to make money,” said Weidner, whose company once filed a lawsuit against the authority that delayed an expansion of the convention center. “They figure out a formula to consume it.”
Weidner said the authority, which charges about 25 cents per square foot of exhibition space at the convention center, undercuts trade show venues, such as the Sands Expo and Convention Center.
He said the authority could raise prices on convention space or, better yet, get out of the convention business altogether.
“I’d privatize it,” Weidner said of the Las Vegas Convention Center. “I’d sell it, pick up the cash from it and return the room tax to the hotels.”
But most major hotel operators support the authority.
Alan Feldman, spokesman for MGM Mirage, which has 10 properties on the Strip, said the authority’s consistent marketing and trade show work produces a steady stream of business that supports individual resorts.
“The creation of a vibrant and stable marketplace is what allows companies to make major capital investments,” said Feldman, whose company is building the $7.4 billion CityCenter resort and casino project on the Strip.
Instead of dipping into the authority’s share of room tax revenue to fill the estimated $137 million hole in the state budget, Feldman suggests broadening business taxes in Nevada beyond the gaming and hotel industry.
Feldman said demands from Southern Nevada’s growing population are too big for one segment of industry to support.
“That has always been a luxury we’ve been able to afford until now,” he said. “That model is no longer working.”
