Opposing Viewpoint
Understanding the privatization of Houston's convention & concert facilities: Aplan defender's turn
City Hall's plan to sell its Convention and Entertainment Facilities department to form a new non-profit corporation, Houston First, with the Houston Convention Center Hotel Corporation (HCCHC) brought a media backlash earlier this month, along with complaints from District I Councilman James Rodriguez that resulted in the downtown delegate storming out of City Hall chambers.
To better understand the merger and get the other side, CultureMap spoke with Richard Campo, chairman of the Hotel Corporation Board, who is overseeing the deal that will initially bring $8.6 million to a cash-strapped City Hall, followed by five annual payments of $1.4 million. The influx would bring the city's budget shortfall down to $75 million, allowing for fewer city services to be cut. According to Campo, both organizations were already tasked with the same role: Marketing Houston.
"It's fundamentally good," Campo says of the plan, explaining that the proposition has undergone three major studies in the past decade. "When you think about it, these entities are already doing the same thing. It makes a lot of business sense to consolidate, eliminate overhead and take the cash that you're spending on accountants and direct it more toward marketing and the greater good of Houston."
Campo says that the consolidation with HCCHC, which already operates the Hilton Americas-Houston, will allow such properties as the George R. Brown Convention Center, Wortham Theater Center, Jones Plaza and Miller Outdoor Theatre to benefit from the $30 million dollar annual cash flow brought by the hotel.
According to Campo, that money is crucial to build new venues and set a long-term initiative to maintain aging buildings, such as the 45-year-old Jones Hall. What's more, the new organization would be able to sell select sponsorships at venues such as the convention center, reaping a projected $3 million to $7 million annually.
The privatization of the public venues may be compared to the city privatizing the Houston Zoo as an independent non-profit in 2002, leading to over $40 million in upgrades. Unlike the zoo, however, the CEF department was operated apart from such entities as parks, libraries or trash pickup. Instead, it was considered an "enterprise department," or economic generator for the city, funded by the state hotel occupancy tax and its own revenue.
"There's a lot of noise about employees not being treated well, which is absurd," Campo says.
Indeed, when news broke of the deal, immediate concerns arose regarding the current 120 CEF employees and their benefits and pensions.
"It's not about layoffs," Campo says, maintaining that no city employees will lose their jobs in the transition. Were they to remain city employees, according to Campo, many could face losing their jobs as cutbacks continue to decrease government workers.
"While people may be reassigned or redirected to be more productive, this is not about lowering people costs. It's about audits and lawyers," Campo says.
He maintains that pension funds will remain intact and employees will receive similar benefits to those they received while working for the city. Campo paints a portrait of a Houston First rife with satisfied workers: "Keep in mind that, ultimately, for the organization to be successful, people have to be happy."
He's quick to mention that other than his unpaid post at the HCCHC, his regular employment is at the helm of apartment corporation, Camden Property Trust.
"Yes, I have a real day job," he says, noting that Camden has ranked No. 7 among the "100 Best Companies to Work For" by CNN Money. According to CNN, one Camden employee team dispatched a scrapbook to Campo to demonstrate how much they love the company.
Does Campo's arguments make you feel better about the City Hall plan? Or are you dubious? Let us know why in the comments.