City Proposes to Lease Prime Arts Venues; Local Man Likens It to Desperate Crack Deal
For those of you who might have been doing other things over the weekend, a trial balloon was launched in Saturday's Metro section of the Houston Chronicle.
Specifically, the idea is being bandied about for the City of Houston to sell off its Convention and Entertainment Facilities department, which oversees the operations at prime, taxpayer-built venues such as the Wortham Center, Jones Hall, the George R. Brown Convention Center and Miller Outdoor Theatre. Backers of the plan say it will bring a much-needed $10 million rainfall into a city whose finances are as cash-dry as our withering lawns are drought-stricken.
Opponents of the plan say it is little more than a scheme by which the city will rid itself of 120 union jobs (with benefits, and more importantly, pensions) and replace them with low-paid, minimally benefited workers.
Under the terms of the secretly crafted plan, the existing governmental entertainment office would be merged with (and presumably subsumed by) the Houston Convention Center Hotel Corporation, a nonprofit created by the city to run the Hilton Americas hotel downtown. This new organization, to be called Houston First, would lease Jones Hall, the Wortham, Miller and the convention center for $2 million a year for five years, payable with a single upfront payment of $10 million.
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An anonymous source told the Chron that Houston First could then rake in $3 million - $7 million per year in sponsorship money alone. (Then why isn't the city the guy who can swing those deals, wonders one skeptic.)
Houston First would be able to operate more nimbly than the city, the source continued to the Chronicle, and not have to clear sponsorship options through our elected officials, specifically, city council.
Houston First would also be able to take risks on hosting trade shows the city might not be willing to take on, the source said. They would be gambling with their own money rather than that of the taxpayers, the source explained. Ric Campo, chairman of the Hilton America's board, told the Chron that the merged organization would be able to spend more on marketing.
The "way, way funky" terms of the deal, if not the deal itself, trouble a Houston arts insider who did not want to be named. We'll call him Walt. He's not philosophically opposed to the deal -- he even says he would go so far as to welcome a corporate pariah like RJ Reynolds coming in and throwing a CamelFest downtown if that would bring in money and good times to the city. He just wonders if this particular deal is the best way to bring in the most money.
Wonders Walt: "Are we that cash-strapped where we can't wait six months and say, 'All right, we're gonna have an operating license for sale for these venues, here's the responsibilities,' put out a request for proposal and a market price and see who the hell winds up showing up with the money?"
If you are selling your house, Walt points out, it's not smart to tell only one prospective buyer. "That's only fine if they pay you the price you want to sell it for," he says. "This seems more like they are buying it for the price they want to buy it for."
What's more, who pays for upgrades to those buildings over the next five years, Walt wonders. What will be the salary of the people atop the board of this nonprofit? How do the people of Houston benefit from this sell-off, which Walt likens to a musician trading his guitar for crack-rocks?
"I generally disregard online comments except when I agree with them," Walt says. "Then they are good. And people have asked a lot of good questions after the Chron's story, like 'Who pays for the new AC unit at the George R. Brown?' Taxpayers built [and ran] that facility for many, many years and for them to instantly say, 'We're cashing out for $10 million, and somebody else is gonna run 'em,' and there's no talk of an income to taxpayers or a royalty stream based on all that."
"If it's a deal that can stand up to public scrutiny, then cool, I'm not opposed to it to be opposed to it," Walt says. "There just needs to be more information and public discourse on this."
And soon. City Council is slated to move on this later this week, mere days after this secretly hatched plan was released.
To a newspaper. On Saturday. Sadly, if there's a better way to bury a story nowadays, we don't know about it.
For the record, Andy Icken, Mayor Parker's chief development officer, did not speak to the Chron but did release some boilerplate, claiming that the deal would result in greater "efficiencies" and more effective operations, and a "more focused and targeted approach" to meeting customer-service needs.
Icken is slated to elaborate on the deal in City Council chambers later today. We'll have more later.