The City of Los Angeles could save millions of dollars a year by turning over its Convention Center to a private manager, according to a report released today.
Privatizing the Convention Center would save between $14 million and $37 million over a five-year period, City Administrative Officer Miguel Santana wrote in the report to the mayor and Los Angeles City Council. It would also give Los Angeles a management structure similar to those in Chicago, Detroit and San Francisco.
“Privatizing management is a clear indication that the LACC is committed to improving its competitiveness in the marketplace,” Santana added.
In 2010-11, 11 percent of the Convention Center’s business attracted significant numbers of out-of-town guests. In other major cities, that figure is closer to 60 percent, according to the report.
Mayor Antonio Villaraigosa supports the proposal, which comes at the same time the Anschutz Entertainment Group is hoping to knock down the Convention Center's West Hall to make room for Farmers Field. The space would be replaced with a new, reconfgured hall
“My goal is to ensure the Convention Center is being managed to reach its maximum potential as citywide conventions significantly bolster the local economy by generating (transient occupancy tax) and sales tax revenue,” Villaraigosa said in a statement.
“Cities like Chicago and San Francisco - with highly successful convention industries - have entered into public-private partnerships, making it something worth supporting."
However, a representative with Service Employees International Union, Local 721, voiced concern for the Convention Center’s 113 employees. Almost all those employees would be transferred to other city departments under the privatization plan.
“The CAO is proposing nothing short of the Walmart-ization of city services,” said Lowell Goodman of SEIU. “At a time when we should be building up the middle class in Los Angeles, he’s trying to tear it down.”
The CAO report urges the Los Angeles City Council to select a private manager by January so the Convention Center can transition to a new management structure by July 1, 2013.