Initial efforts more than 15 years ago to make Austin a convention destination have proven so effective, according to city staff, that a larger event center is needed to accommodate increased demand.
A proposal to expand the existing Austin Convention Center westward could help provide enough extra meeting space for larger conventions, said Mark Tester, director of the city's Convention Center Department.
"We went from having a decent-size convention center with not enough hotel rooms to having too small of a convention center with too many hotel rooms," Tester said during the Aug. 24 Economic Opportunity Council Committee meeting.
City collections from hotel occupancy taxes, which take a portion of room revenues, have steadily increased by 1.5 million per year, on average, according to Tester. The city anticipates collecting $76.3 million in hotel occupancy taxes in 2015-16, up from $45.2 million in 2008-09 and $24.6 million in 1999-2000.
But the city is failing to gain interest from many larger-scale conventions because Austin Convention Center is overly booked or too small to accommodate bigger events, Tester said. The city in 2014 hired San Francisco-based consultant M. Arthur Gensler Jr. & Associates Inc., which has an office in Austin, to review potential convention center expansion ideas.
This rendering shows where the city is considering expanding Austin Convention Center. A portion of Second and Third streets would be vacated to accommodate the expansion, according to the city.[/caption]
Gensler ultimately proposed expanding Austin Convention Center to the west, adding 200,000 square feet of exhibit space, 65,000 square feet of meeting space and a 56,700-square-foot ballroom as well as additional underground parking and loading dock space.
"The convention center in its current phase is like a fortress, and there's really nothing on at the street level," said Alan Colyer, a Gensler principal and design director, during the Aug. 24 committee meeting.
The city proposal also calls for a 3-acre "urban park" atop the expanded convention center, Tester said.
Private land must be purchased to enable such an expansion. Tester said the city has not ruled out using eminent domain to obtain property between Trinity Street and San Jacinto Boulevard. The land would ideally be shared to create more street-level commercial space, Colyer and Tester agreed.
Voters in November 2016 may be asked to rededicate 2 cents from the existing hotel occupancy tax to expand Austin Convention Center, Tester said. Council Member Ellen Troxclair, who chairs the Economic Opportunity Committee, emphasized the tax is already in place and would not increase residential property taxes.
Troxclair said the city should also be able to sell residents outside of downtown on the benefits of a Convention Center expansion.
"Residents [outside of downtown] don't always connect the benefits of tourism ... so I think it's important for us to be able to say to them, 'Here's the financial benefit and the money that's going to be invested back into their community.'" she said. "I'd be interested in seeing more about that moving forward."
Council is likely to consider a resolution in the coming months affirming its interest in a Convention Center expansion; however, no action was taken Aug. 24.
Should Austin residents agree to rededicate existing taxes to the proposed expansion, construction could start by 2020, and the renovated Convention Center could open by November 2021, according to the
city's projected long-range plan. The project could cost, excluding land acquisition, between $400 million and $600 million, according to city estimates.