State Budget Puts Pinch On Convention Center

June 9, 2005
By JEFFREY B. COHEN, Courant Staff Writer

Five days after the $271 million, state-owned Connecticut Convention Center opened, the state legislature has approved a budget that cuts the center's marketing and transportation spending by at least $800,000, state officials said Wednesday.

"It's very likely it will have an impact on the overall marketing budget, and it's likely it will have an impact on the downtown circulator project," said Dean Pagani, a spokesman for the Capital City Economic Development Authority. The circulator is a bus that would connect the convention center to downtown hotels.

Pagani said CCEDA's original budget request to the governor's office was for $6 million. The governor reduced that figure to $5.5 million in her proposed budget. Then, the legislature's appropriations committee cut that by $1.8 million, only to reduce the cut to just $800,000 last week before passing the budget.

That leaves CCEDA's budget at about $4.7 million for the upcoming year - $700,000 in operating expenses for the agency, a $2 million operating subsidy for the convention center and $2 million for marketing, Pagani said. The marketing dollars are spent by the Greater Hartford Convention and Visitors Bureau, with which CCEDA contracts to sell the convention center to large conventions that would fill several city hotels.

Last week, state Rep. Denise W. Merrill, D-Mansfield, a main budget negotiator, said the legislature planned to reduce its cut to the CCEDA budget after some initial skepticism "because I'm convinced they're going to do a good job with it."

The $4.7 million figure spells two types of trouble for the building's marketing future, CCEDA and visitors' bureau officials said. First, it's a reduction in funding - for 2005, CCEDA gave the visitors' bureau $2.4 million; for 2006, CCEDA will give $2 million.

But second, because the $2 million operating subsidy is less than what could be a $2.5 million need, the difference will have to be financed somehow, Pagani said.

And that somehow would most likely be the marketing budget, he said.

"If [the operating subsidy] goes higher, then it's going to force the CCEDA board to reconfigure the budget," Pagani said. "So there could be even more of an impact."

That's bad news for H. Scott Phelps, head of the visitors' bureau.

"It's a significant drop in revenue, no question about it," said Phelps, whose total annual budget is $2.9 million. The result, he said, would likely be less advertising in national convention industry magazines and less participation in trade shows that promote the facility, he said.

"There's a sense of frustration there because of the momentum we've built up," Phelps said. "We're feeling very good about the sale effort. We're getting excellent responses, and we just want to keep that momentum going. You don't want to have any kind of a push-back."

"It's very difficult to make everyone understand that we're in the business of importing dollars earned in other states and bringing them here," he said. "It really is pure economic development."

Arthur L. Handman, executive director of the Greater Hartford Transit District, said the cut in CCEDA funding puts the plan to run a circulator bus from the convention center to the city's hotels on hold. Handman is on the visitors' bureau's transportation committee.

Federal funding for the buses themselves has been identified, he said. Now it's just the operating budget he's waiting on.

"I was anticipating the worst, but I was optimistic in this case. I thought we would have the money," Handman said, comparing the $648,000 cost to operate the circulator with the total investment in the $271 million facility. "It doesn't make any sense to me."

State Rep. Marie Kirkley-Bey, D-Hartford, said she was distressed to hear of the initial cut at the appropriations committee, and fought to have the money restored. "It's almost like you were asking for it to fail," she said. Then, when budget negotiators restored $1 million of the $1.8 million, she fought for the rest, she said.

"Being that this is their first year out of the chute, we thought we'd have to spend a little," she said. But her plea fell on "deaf ears," she said, and the $800,000 was no longer available.