The Medical Mart Plan Makes No Sense Too Me

[Paul Schrimpf]

If you want to compete, you better have a decent place to have a meeting. We simply don't. We've put this off for almost two decades. I did shows at the Convention Center in the 80s and 90s. It was and is non-competitive in a hundred ways.

There are a zillion things that are not cost effective to build and run. That's not an argument to not do something, if in the aggregate it adds to the benefit to all. As a second tier city with a lot to offer a visiting group, I think it is imperative that we have a convention center adequate to hold medium sized tradeshows like other Midwest cities of our size.

[Dee Martinez]

There are a zillion things that are not cost effective to build and run. That's not an argument to not do something, if in the aggregate it adds to the benefit to all. .

Very true but the fact that the citizens of Cuyahoga County have been paying and paying and paying and have seen virtually nothing in terms of return IS a reason to be skeptical about this year's panacea.
You are speaking for a new Convention Center, we've been talking about the Medical Mart. I am a little unclear, arent these two separate projects?

[Shawn Juris]

Dee
This may be a point that draws the line in this argument. Again, if Cleveland (public and private) did not invest what it did for the project that have been minimized in this discussion, what would the core of the city look like today? While the aspects may not be important to you, just like medical isn't something that affects my daily life, I'd hope that you could recognize that it is something on the positive side, not something on the negative to have 3 sports teams, a progression of development in the lifestyle (flats, gateway, warehouse) area, upscale housing, and the theater district.
I think there may be a fundamental point that needs to be clarified. What should a mid market metro center offer? Without coming to terms with this we're just posting our opinion of what another area should look like. For all I know some may envision Downtown Cleveland and being leveled and turned to green pastures so that Lakewood no longer has to neighbor to a metro center. For all I know some may simply wish that they lived in Mayberry which was 100 miles from the trappings of pro franchises, Fortune 500 headquarters, cultural centers, tourist attractions etc. For all I know...

Regarding the pre-requisite of having an Invacare caliber participant in the Med Mart project, I understand your point, dl. This stands to reason that they have built into the MOU a clause that releases both parties should MMPI not be able to attract the support needed in the preliminary stage. Isn't it reasonable to expect that a certain amount of presale activity be involved first before the property is built?

[David Anderson]

It’s hard to decipher tone and intent via the written word. I appreciated all the comments and pushback to my first post. My responses are given with the best intentions of debate. I may not be able to change your mind but perhaps I can share something that you did not know before. The civil give and take on this thread is impressive.

Yes, all levels of government have concerted effort towards economic development. We may not like it but it’s what they do. The public/private partnerships help these become effective economic activity generators.

To hit the feedback to my first post one at a time –

Yes, 7 events were held at the Convention Center and the one I attended regarding the commercial and domestic use of alternative energy systems wasn’t included. And the 3 I-X Center events didn’t include the Auto Show. At any rate, I am working to find a better, more complete list.

Brad - I appreciate your comment about making better choices regarding focus, but it’s not been proven to me that our collective efforts concerning a new convention center are taking away from an opportunity somewhere else. There are a dozen initiatives under way right now, and have been for some time, geared towards attracting, retaining and developing high growth businesses in the County. These initiatives are being coordinated like never before. I don’t think that the choice of pursuing a new Medical Mart and convention center are losing us opportunities elsewhere.

Paul – You wrote that 7 of the 69 events were held at the Convention Center. That’s the point exactly. As much as I love that building, we’re paying to maintain a dinosaur that does not meet market demands. Your later post where you write that “it was and is non-competitive in a hundred waysâ€￾ hits the nail on the head.

Dee – The $200 million in hotel and restaurant receipts is just for one year. Go out five, 10, 15, 20 and 25 years. Also, the multiplier economic impact of $200 million could be somewhere around $1. 4 billion annually (see my version of economic impact two paragraphs below).

Bill – Who is promoting the Convention Center as a “Silver Bulletâ€￾ and where? I’ve not heard this but don’t have TV. And, yes, Forest City will develop the Scranton Peninsula if the Convention Center is across the river from Tower City.

Bill – Where in the spreadsheet does it read “$172 million in revenueâ€￾? It reads “estimated economic impact.â€￾ If you own a convenience store and I came in and spent $10. You would, in turn, spend $9.50 of that on replenishing your shelves and paying your employees. Those recipients, in turn, spend 95% of that on other things, and so on, and so on. So, yes, a hotel stay for two people who eat three meals a day and maybe see a show or a museum after the convention could mean $2,000 of economic impact.

Bill – You asked, “The 68,000 who live here and didn't stay in a hotel spent some money at the convention that would have been spent where they live in Parma or Lakewood. Where's the benefit there?â€￾ It’s economic activity and there is a county wide sales tax.

Bill – The amenities are all part of the package. Those companies left because NE Ohio is an expensive place to do business and find a qualified workforce. The changes made in Ohio tax law ant the CAT tax will change this quite a bit. (This reform of Ohio tax law affects most Ohio business and Ohio income taxpayers. Among the changes are an income tax cut, the phase-out of the tangible personal property and corporation franchise taxes, the elimination of a 10 percent tax rollback on real property classified as commercial, and the introduction of a new low-rate, broad-based Commercial Activity Tax (CAT) on a business's gross receipts.) Ten Fortune 500’s still remain in the region. The new companies are on the Weatherhead 100 list provided in my previous post. The question we should all be asking isn’t why the Fortune 500’s left but rather why GE came to Nela Park in 1911 to establish the world’s first industrial park.

Dee – Where have we been “paying and paying and paying with seeing virtually nothing in terms of returnsâ€￾? Investments in Tri-C Metro, The Q, Progressive Field, CSU, Browns Stadium, R&R HOF, Science Center, Playhouse Square, Third Frontier Grants, University Circle, and the innovative research centers in and around the Cleveland Clinic hospitals’ network are just a few examples of return on investment. Add the East Bank development, Euclid Corridor and other projects (i.e. a Convention Center and permanent Medical Mart) into the mix a few years down the road.

No, these investments don’t pay for themselves in a year or five. These things take time but there is a ton of smart work being done via public private partnerships and state, federal and local incentives.

[Dee Martinez]

Davidl:

Lumping the Browns stadium and the Rock Hall with investments in Tri-C and CSU is something I didnt do, and neither should you. It isnt my position that government should never spend money. My issue is asking the public to make investments that private industry is unwilling (or too smart) to make for itself.

As for 3 sports teams, Detroit has 4, Portland and Nashville each have 1, Austin and Albuquerque have 0. Where's the better place to be right now?

Shawn:

If the conventional wisdom is, "yes, things are terrible but if we hadnt spent all those hundreds of millions, theyd be even worse" we are showing some twisted thinking. Public spending should move us clearly forward, not just mitigate our degree of disaster.

At some point, the bottom line is the bottom line. After all the spending David lists, Cuyahoga County is STILL in the top 5 in population loss NATIONALLY. I loathe cliches but "the operation was a success but the patient died" seems appropriate here.

[Paul Schrimpf]

I'll just have to be in disagreement with some of the folks on the board when I say that we need, need, need a decent convention center. If the med mart comes with the package but greases skids on development, fine.

There, I said it. No illusions of grandeur, no silver bullets. A convention center is table stakes for being a competitive second tier city.

[David Anderson]

Dee -

Although I appreciate you telling what I should and should not do (I'm always in need of guidance), I believe the list I provided is an apple to apple comparison. Public and private funding streams, partnerships, incentives and agreements were used.

If your definition of return on investment revolves around overall population growth, well, then, the only ones winning are the southern and south west states.

What would you do if made benevolent dictator for the day?

[Bryan Schwegler]

I'll just have to be in disagreement with some of the folks on the board when I say that we need, need, need a decent convention center. If the med mart comes with the package but greases skids on development, fine.

There, I said it. No illusions of grandeur, no silver bullets. A convention center is table stakes for being a competitive second tier city.

I agree with you Paul.

In the end, no matter how you spend the money, or even if you don't spend it at all, there will always be someone upset about it or someone who thinks they could have done better. There is no way to make everyone happy with every decision.

[Dee Martinez]

I'll just have to be in disagreement with some of the folks on the board when I say that we need, need, need a decent convention center. If the med mart comes with the package but greases skids on development, fine.

There, I said it. No illusions of grandeur, no silver bullets. A convention center is table stakes for being a competitive second tier city.

And I am not in total disagreement with you. However, we should stay within ourselves.
Planning for a modern but modestly-sized facility, neither a shotgun shack nor a Taj Mahal, able to accomodate the regional 2-3 day meetings you describe, is OK by me.
But thats not what Cleveland traditionally does. It oversells, overpromises, and overspends. And when the last big thing fizzles its on to the NEXT big thing.

David, I dont presume to tell anyone what to do, unless what they are doing is ascribe attitudes to me that I never expressed. When you lumped CSU with the Rock Hall, you took a statement I made in a direction I never intended. No fair.

As for what I would do, I might start by realizing that even benevolent dictators can only do so much. I am not particularly bullish on the future of the Rust Belt and I do believe that bleeding citizens white through public sponsorship of things private industry doesnt want will only make things less pleasant.

So heres a place to start. Any project like a sports facility or a Medical Mart or a Crocheting Hall of Fame that cant find 50 percent private financing, CASH, doesnt move forward. Hows that?

[Bryan Schwegler]

Planning for a modern but modestly-sized facility, neither a shotgun shack nor a Taj Mahal, able to accomodate the regional 2-3 day meetings you describe, is OK by me.
But thats not what Cleveland traditionally does. It oversells, overpromises, and overspends. And when the last big thing fizzles its on to the NEXT big thing.

Also a good point to keep in mind Dee. We'll just need to wait and see what the final plans look like.

[David Anderson]

Dee -

The list I developed was my list. I never wrote your name to it.

I simply asked you to clarify where we've been “paying and paying and paying with seeing virtually nothing in terms of returnsâ€￾?

I made an argument that investments in Tri-C Metro, The Q, Progressive Field, CSU, Browns Stadium, R&R HOF, Science Center, Playhouse Square, Third Frontier Grants, University Circle, and the innovative research centers in and around the Cleveland Clinic hospitals’ network have yielded ROI.

You never intended any push-back on your "virtually nothing in terms of returns" comment? Am I not allowed to offer an observation to challenge this statement? To use your words, No Fair.

I like your 50% up front rule but believe it would make sense if we're the only one in the universe. Unilateral disarmament would single us out as the only ones who don't want to play. Would this yield any more or an ROI than the current public/private financing plans?

What are we stuck with then is giving multi-BILLIONAIRE Al Lerner a $400 million dollar stadium with tax abatement in hopes that the benefits trickle down across the city and county.

I could be wrong, but I don't think the current Medical Mart/Convention Center plan parallel’s the Al Lerner corporate welfare model.

[David Scott]

When looking at the economic impact of Playhouse Square or sports stadiums the local income tax generated must also be accounted for

If the average basketball team salary is $50 million and there are 41 games then the income tax generated is $50 million x 2 teams x 2% tax / 82 total games x 41 local games = $1 million

Using the same base, 14 football games and 80 baseball games generates and additional $1 million in local taxes per sport. I don't have the figures, but I could guess that Playhouse Square also generates $1 million in local taxes

$4-5 million pays for a lot of police and fire staff

[Dee Martinez]

Dee -

T
I made an argument that investments in Tri-C Metro, The Q, Progressive Field, CSU, Browns Stadium, R&R HOF, Science Center, Playhouse Square, Third Frontier Grants, University Circle, and the innovative research centers in and around the Cleveland Clinic hospitals’ network have yielded ROI.

You never intended any push-back on your "virtually nothing in terms of returns" comment? Am I not allowed to offer an observation to challenge this statement? To use your words, No Fair.

.

There is a big, and fundamental difference between a government supporting higher education and a government building pleasure palaces for the well-heeled. Education is something government does, not only for a dolllars-and-cents ROI, but because its something expected of a SOCIETY.

The idea that the Rock and Roll Hall of Fame and Cleveland State Universitiy are somehow on equal footing in terms of worthy projects for a community to support is sort of jarring to my ear.

As for the 50% suggestion, I know its a tough cruel world out there. But some cities roll over and some dont. Vancouver lost an NBA team and Los Angeles hasnt had football in years but I dont see people jumping off the cliffs into the Pacific over the loss.
However, back to the Medical Mart, I still want to know who in the industry has asked for this? What commitments has anyone made that they will be on board once this thing is opened?

15 years ago, the music industry gave Cleveland all kind of broad hints, as I recall, that they really didnt want the Rock Hall here. Not one major player in the industry was in our corner. But we couldnt take the hint, so we pushed and pushed and paid and paid and now we have this thing that really hasnt lived up to anyones expectations, and in three more years well have a party that no Clevelander will be invited to.

When someone can show some commitments from the industry, thats a different story.

[David Anderson]

Now I understand your point, Dee, about the listing of projects on my posts. You distinguish some as “pleasure palaces for the well-healed.â€￾ While distinctions are important, we’ll have to agree to disagree on this one. Each brings its own attributes, rewards and impacts to the table. One can’t look at the number of tickets sold as the complete impact of the R&R HOF.

I’ll admit, though, that very little has been nailed-down outside of the sales tax and partnership with Merchandise Mart Properties, Inc. In addition to MMPI, Inc., Steris is on board and is currently working to identify the array and quality of medical /equipment devices and manufacturers that should be included in the Medical Mart. The success of this is needed to attract medical tradeshows and conventions.

If this works, Cleveland stands to be ahead of the curve.

This is from a recent Greater Cleveland Partnership publication: “It’s important to note that we don’t consider the Medical Mart to be a single project that can ensure our region’s economic future. But it does promise to positively influence several key areas: helping to revitalize downtown Cleveland—critical to the Northeast Ohio economy; creating jobs for individuals with varying levels of skill and education (hospitality, healthcare, construction and high-tech); providing linkages that create opportunities for our existing manufacturing companies; and taking steps to position Cleveland as the healthcare capital of the United States.â€￾

[ryan costa]

The reelection of present County Commissioners must be destroyed.

If they can't book medical conventions in the present convention center, there is no reason to believe they will be able to get many booked at a new convention center.

It may not be too late to incinerate the agreements to build the new "medical mart".

If the new "medical mart" must proceed...It must be built East of East 9th Street off of St.Clair, Lake Avenue, Chester, or Euclid.