GOP convention: What's the payoff?by Martin Moylan, Minnesota Public Radio
What's the Republican National Convention going to be worth to the Twin Cities economy? Some folks involved in the campaign to land the convention have been throwing around estimates of an economic kick worth $150 million. But that forecast seems to be based more on rumor than research.
St. Paul, Minn. — Laura McCarthy is the communications director for Meet Minneapolis, the convention and visitors association for the city and surrounding communities. She's heard lots of estimates for how much of a boost the convention will give the Twin Cities economy. But she says her organization isn't making any projection about the economic kick the convention will provide.
"I don't know exactly where all the numbers are coming from," she says. "We don't have an exact estimate at this point. It will depend on the amount spent to stage the convention and the number of people coming."
McCarthy says more than 40,000 people could end up coming to the Twin Cities for the convention. She says much of the benefit from hosting the convention will be hard to measure.
"So much of the benefit we get will be after this thing is over and we raise the profile of the city and attract more people to visit and even live here," she says. "It will be a good thing for us for many years to come."
Maybe. Maybe not.
Frank Conte, communications director for the Beacon Hill Institute, a Boston think tank, says his organization has found national political conventions provide little, if any, economic benefit to cities. Conte says the benefit is often exaggerated by the folks who work to win a convention for a city. But it turns out to be far less than the convention boosters claim.
"And it poses several problems for the local economy," he says. "The benefits are small and the sacrifices are sometimes large."
Conte says Boston's net economic benefit from the 2004 Democratic convention was only about $15 million.
He says cities displace a lot of business and events to win conventions. That has to be into account.
"The cities opt for the convention and distort the natural flow of the economy in the city," he says. "That's what happened in Boston. They decided to do without Sail Boston, which was a Tall Ships exposition in the harbor, and they decided to forego the Olympic trials for gymnastics."
Conte says many convention attendees simply displace other people who would have stayed in a city's hotels and eaten in its restaurants. And with concerns about terrorist attacks these days, Conte says cities face huge costs for providing security.
Los Angeles was invited to bid for both the Republican and Democratic conventions. But it said, "No, thanks."
Jack Kyser, chief economist for the Los Angeles County Economic Development Corporation says the conventions were not worth bidding for. Not given the costs associated with hosting them.
"We feel they no longer make economic sense," he says. "The conventions really don't mean anything. We all know who the candidates will be before the conventions start. The groups that come to conventions --the delegates-- aren't your typical tourists. And they're expecting a lot of free parties."
But Minneapolis officials remain convinced the economic benefits will be significant. Jeremy Hanson, spokesman for Mayor R.T. Rybak, says the people attending the convention will likely spend an average of $1,500 each. And, Hanson says, some $45 million in money will be spent to stage the convention. That money will come from outside the Twin Cites.
"Inviting as many as 20,000 guests to Minneapolis and St. Paul for the convention will have an incredible economic impact,'' he says. "People will stay in hotels. Go out to dinner. Spend money. Shop. And return home with wonderful stories to tell about Minneapolis-St. Paul."
Mark Drake, communications director for the state Republican Party, agrees. He says he could not put a value on hosting the convention. But he says he's confident it will be great.
- All Things Considered, 09/28/2006, 5:18 p.m.