JACKSON — Last November, Mayor Harvey Johnson Jr. unveiled his prized proposal: the Capital City Convention Center. The $85-million facility, which he calls “an economic generator,” would promise more tourists and pump needed dollars into the local economy. But, as with many dream projects, there’s a hitch: finding the funding.
Several financing mechanisms have been discussed, including legislative support, an increase in sales tax and/or a higher hospitality tax. The sales tax in Jackson could be raised from 7% to 8% across the board, perhaps with the exception of restaurants and hotels. An additional 2% would increase the hospitality tax from 8% to 10%.
“The state Legislature is not going to give the City of Jackson that kind of money,” said Malcolm White, head of the state telecommunications board. “All sorts of financial schemes have been put forth that would raise this money, but it would be up to us to self-tax ourselves. It’s my understanding that citizens would vote on whether to assess this.”
A local hospitality representative, who asked not to be identified, said: “I’m all for developing a convention center, but at whose expense? The citizens? The hospitality sector? Will there be an automatic referendum? Or will citizens have to force a reverse referendum? Right now, there are more questions than answers and we haven’t heard any of the details, yet the mayor is blazing forward anyway.”
“All of the options we’ve examined involve increases in sales tax and hospitality tax,” said Johnson. “A 1% increase in sales tax and a 2% increase in hospitality tax would generate enough revenue to build the convention center, to provide for maintenance and promotional costs, and to also assist the City of Jackson in meeting some of its dire infrastructure needs, such as improving our drainage system, our water and sewer system or even street paving. We’re trying to put together a financing mechanism that would not only provide the City of Jackson with the long-term benefits of a convention center, but also the short-term and immediate-term benefits of improvements to our infrastructure.”
Even though Jackson’s Sen. Hillman Frazier and Rep. Mary Coleman, both Democrats, have said they would consider measures to make the convention center a reality, neither introduced legislation supporting it. However, a non-revenue bill filed by a lawmaker from Northeast Mississippi included a possible funding mechanism for the convention center.
Buried deep in Senate Bill 2204, an environmental bill summarized as “taxation; income tax credit incentives for certain activities at brownfield sites,” includes a section to establish a capital improvements revolving loan program for local governments to be administered by the Mississippi Development Authority. Introduced by Sen. Alan Nunnelee (R-Tupelo), Section 4 includes “construction, purchase, renovation or repair of any building to be utilized as an auditorium or convention center” and “construction of multipurpose facilities for tourism development” as capital improvements. On Jan. 10, it was double referred to environmental and finance committees. At press time, additional action had not been taken.
Johnson said he was not familiar with SB 2204. “I don’t know the specifics of the bill, but it’s certainly something we will take a look at,” he said.
Jackson city officials, MetroJackson Chamber of Commerce and the Jackson Convention and Visitors Bureau have endorsed the convention center project, but the Mississippi Hotel and Lodging Association said it would not support a hospitality tax hike for its construction and would prefer a higher local option sales tax instead.
“The Capital City Convention Center to follow the Mississippi Telecommunications Conference and Training Center could honestly set the stage for tourism growth in Jackson,” said John Lawrence, president of Downtown Jackson Partners. “The telecom and convention centers will allow us to branch into new areas of tourism like business travel, which is truly the staple for downtown hotels and restaurants across the country.”
Lawrence said the challenge would be “to capitalize on the new facility and encourage private real estate development near it.”
“This will create an atmosphere that further increases our viability as a convention destination and will positively impact the tax base for Jackson and Central Mississippi,” he said. “This is also where we will have the best opportunity to grow hospitality-related jobs that are uniquely positioned for access by inner-city residents.”
Recently, the mayor’s office released a flyer calculating that the $85-million cost would be offset by an estimated total annual economic impact of $80 million. The breakdown reflects $56.6 million for the convention center and $21.4 million for the telecom center. The convention center construction impact to Mississippi was estimated to be 1,375 jobs and $107.3 million. About 1,100 jobs would be created because of the facility, said Johnson.
“We can not overlook the economic impact this facility will have on our economy,” said Johnson.
Even though it’s still being debated whether Jackson needs a telecom center — or if the location chosen is appropriate — planning is in full swing, with architects at Dale and Associates in the design development stage. Land for the facility has been acquired from the city and the project will be ready for bid soon.
Of the $17.5 million authorized by the Legislature to build the telecom center, the bond commission has issued about $2 million “to get the land, get Dale underway and the process moving forward,” said White.
“We begin to pay back the bond with the 75