Zurik: Convention Center attendance numbers don’t add up

Convention Center attendance numbers don’t add up
Published: Nov. 8, 2016 at 3:10 AM CST|Updated: Nov. 8, 2016 at 8:14 AM CST
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NEW ORLEANS (WVUE) - If you take the management of New Orleans' Morial Convention Center at their word, then you'd likely assume that "business is booming" - that's exactly what GM Bob Johnson tells us in a recent interview.

In 2014, for instance, the Morial Convention Center reported an economic impact of $1.81 billion. But is that even close to accurate?  If you investigate the numbers that MCC publishes every year, you'll find that booming assessment may be off - sometimes, way off.

"Who do you think you're fooling?" wonders policy public researcher Heywood Sanders, author of the book Convention Center Follies. "Let's be real, let's be honest. Let's give the public a realistic assessment of how this thing is doing."

Sanders says such a realistic assessment won't be a pretty picture - but it's one that many observers are seeing in city after city with a convention center in its mix.

According to MCC records, the 2014 National Automobile Dealers Convention attracted 43,500 out-of-state attendees. But that organization reported a much lower number: 23,463 attendees.

In 2015, MCC reported 19,000 out-of-state attendees for the New Orleans Rock 'N' Roll Marathon. But marathon organizers told us by email the actual number was much less: 9,800.

MCC reported 7,700 visitors for the National Council of Mathematics conference; 1,648 attended, conference organizers tell us.

When the U.S. Green Building Council held its 2014 Greenbuild International Conference & Expo at the Morial, MCC reported 25,000; the group itself reported less than 18,000.

The list could go on and on. And these discrepancies mean something.

"When questions like that turn up, red flags ought to be raised in lots of places," Sanders tells us. "Those things just don't make sense."

As Sanders points out, out-of-state attendee numbers are a critical factor in determining how the convention center industry reports its own economic impact to host cities.

The Morial Convention Center circulates a yearly economic impact study to help show lawmakers and business leaders that the venue is an economic engine. But if these attendee numbers are inflated, then so is the center's impact.

"Nobody's auditing those numbers," Sanders warns. "Nobody's asking the question, should we count 19,000 for the marathon? Is that number of hotel rooms really what happens? Or is it a guess that somebody made five years before the event, when they were booking something?"

In 2013 and 2014, MCC reported the Rock 'N' Roll Marathon used 2,000 hotel rooms. But in 2015 that number, as reported by MCC, jumped by 850 percent - the center reported 19,000 rooms used.

When we asked the Morial's general manager if that sort of jump is possible - if it's reasonable to believe that hotel room usage rose by 17,000 when attendance for the marathon itself actually dropped by 1,000 - he responds, "I don't know how many runners they had. And the hotel numbers came from, probably from them… We sure didn't make them up."

In 2013, the center took credit for 75,000 out-of-state attendees for the Super Bowl, using 114,000 hotel rooms. The next year, MCC reported 25,000 out-of-state attendees for the NBA All-Star Game.

To be clear, the center did host some fan events for both sporting events. But claiming these numbers means they calculated every dollar spent, by every NFL and NBA fan, into their economic impact reports for those respective years.

We point this out to Johnson, and he confirms - even the Super Bowl numbers are touted in their 2013 economic impact study.

"That's a citywide impact study," Johnson insists - though the study itself is sub-titled, The Economic Impact of the Morial Convention Center. "Why don't you go argue that with Dr. [Tim] Ryan [the UNO economist who authored the study] - because, again, those are the statistics that we give to him, in terms of attendance for people who come to this building."

Sanders objects, saying those numbers for big-ticket sporting events really should not count toward convention center attendance. "Those aren't a convention," he says. "That doesn't make sense."

In 2013, the convention center reported 125,000 out-of-state attendees for the Essence Music Festival. The next year, that figured dropped to 25,000.

Again, Johnson says those numbers came from the event organizers, not an official count by MCC staff. "Talk to Essence," he tells us.

Sanders insists, "Anybody with any sense knows that the Super Bowl wasn't played at the Morial - and the Essence Festival didn't only take place at the Morial. You could get goody bags there, that was clear. But folks were probably in town for Essence Festival principally for the concerts. It's the same with the marathon. Nobody is running 20-plus miles in the convention center."

In 2014, the convention center reported 531,000 out-of-state attendees, about the same number of people who came to the convention center in 1986. But when you subtract the NBA All-Star Game, correct the numbers from the National Auto Dealers, the Greenbuild and a few other conferences, then the attendance numbers at the Morial Convention Center suggest something far different about its true economic impact.

"If you're going to count them, at least put a big asterisk there and make it clear to the public what those numbers are and where they're coming from," Sanders says. "But otherwise, you know, you have to say, wait a minute - you're doing the same business you say that you did in '85. Were you counting marathon attendees in '85, were you counting Essence Festival or the Super Bowl in '85?"

And if they weren't, Sanders says, that raises an even bigger question, "because that means their actual performance is even worse than it appears in their numbers."

Johnson acknowledges, when it comes to gauging economic impact, "The key statistics are the number of hotel rooms, because then you can track that by the taxes that are paid, and the restaurant covers, because you can track that by the taxes that are paid.  Whether some of these attendance numbers are accurate - it's not an exact science."

The convention center receives $60 million of taxes every year. Lately it has run an annual budget surplus of $20-25 million - that's money they don't spend.

"I'm not saying folks are intentionally trying to deceive," Sanders tells us. "But at end of the day, if no one's asking where did they come from, how did you get this, then the end result is the same. We've got a very inaccurate, unrealistic picture of how those public dollars are benefiting the community."

And that's why Sanders says these numbers really do matter. As the city and state pinch for every penny, leaders need a clear picture of the Morial's true economic impact.

"It's just too easy for things to slip through," Sanders says. "It's just too easy for the authority itself and its board and its staff to say what they've said in their recent annual financial report, that this is an economic engine for New Orleans. The reality is, if it's an economic engine, it's sure sputtering on a fraction of the cylinders that are there. This is not a particularly pretty picture there."

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