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Mayor Parker Calls for Consolidation of Convention & Entertainment Facilities Department with Hotel Corporation

(05/09/2011)

Mayor Parker Calls for Consolidation of Convention & Entertainment Facilities Department with Hotel Corporation

Mayor Annise Parker today recommended consolidation of the city’s Convention & Entertainment Facilities Department (CEFD) into the Houston Convention Center Hotel Corporation (HCCHC). The proposal, if approved by City Council, would provide the city an extra $10 million in the next fiscal year, thus helping to avoid some planned layoffs.

Under the proposal presented to City Council’s Fiscal Affairs Committee today, the newly renamed organization, called Houston First Corporation, would lease CEFD properties from the City for an $8.6 million fee, payable in the next fiscal year, which starts July 1. In addition, an annual lease payment of $1.4 million would also begin in FY12. Future increases in the lease payments would be tied to the Consumer Price Index.

CEFD properties include the George R. Brown Convention Center, Wortham Theater Center, Jones Hall for the Performing Arts, Jones Plaza, Miller Outdoor Theatre, Sesquicentennial Park, Root Memorial Square and several other smaller park and performing arts facilities.

“This is somewhat different from 2002 when the city created a non-profit organization to manage the Houston Zoo because this time the city will receive annual revenue from leasing these facilities.” Mayor Parker said. “Those monies will help the city’s bottom line and, in turn, reduce the number of hard-working employees we have to layoff.”

“Our facilities bring in revenues, but their primary purposes are to serve as economic generators for the city by increasing the levels of convention and tourism business,” said CEFD Director Dawn Ullrich, who would serve as president of Houston First. “We could operate more efficiently as part of Houston First, which would enable us to generate more revenues to the city through increased bookings in the long run. The increased revenues will also allow us to continue to maintain all of our facilities in first-class condition.”

“With consolidation, we create a single entity that’s focused on the operation as a whole for the long term,” said HCCHC Chairman Ric Campo, who would chair the board of Houston First. “We can develop a unified, campus-like approach to soliciting convention business for both the convention center and the Hilton Americas.”

The city is working with the HOPE Union on arrangements for the CEFD employees who will become employees of Houston First Corporation.

The Mayor would appoint and City Council would confirm Houston First’s nine board members. The Mayor recently appointed or reappointed current members of the HCCHC board, who would simply remain in place for the duration of their terms.

The city created the HCCHC in 2000 to govern the construction and operation of the Hilton Americas-Houston.

City Council approval of the merger is tentatively scheduled for May 18.

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