By Robert Haugh
The Santa Clara Chamber of Commerce had their management fee suspended a few weeks ago. The Chamber was suppose to “manage” the Convention Center. Except no one knows what they really did for their approximately $145,000 yearly fee. Or how they magically got a major raise without City Council approval.
Tonight at the Council meeting, the City Council may terminate another agreement that the Chamber supposedly “manages” — the $1.5 million in city funds used by the Convention and Visitors Bureau (CVB). The CVB is suppose to promote convention and tourism activity for the Mission City.
But major questions have been raised about the CVB’s performance. Earlier this year, Jones Lang LaSalle (JLL), a consultant hired by the city to evaluate the Convention Center and the CVB concluded that there were big problems. The net expenditures over the last 10 years was negative $10.3 million. Ouch.
That doesn’t include any sales tax that comes back to the city. But even with that, it’s not close to breaking even. And because the management decided to not to spend money on major capital expenditures to inflate their numbers, there’s a long term facility problem now. Double ouch.
The CVB didn’t look so hot when it came to their performance either. JLL said a key metric is the annual goal of 15 “citywide” conventions — gatherings that actually fill hotel rooms. Currently, we have only three a year. Wow. That’s not good.
The CVB seems to admit that they haven’t done much recently. They bought an ad in the Santa Clara Weekly just two months ago promoting how they were responsible for bringing Wrestlemania 31 to Levi’s Stadium. That was a great event and I was there — three years ago!
Yup, they wasted money with an ad in the Weekly — the publication that has few subscribers in Santa Clara. It’s read by even fewer tourists and that’s the group the CVB is suppose to target. That’s really not good.
City staff has found all kinds of problems with the “management” of the CVB. Here’s a paragraph from the staff report:
… preliminary discussions on how the Chamber manages conflicts of interests; absence of Board training for management of public funds and governance oversight of a public facility; absence of policies regarding self-dealing (e.g., use of the Convention Center relative to fee reductions/waivers) along with already surfaced concerns regarding financial protocols and procedures, suggest deficiencies or lose [sic] management controls in protecting the use of a public facility and funds …
Translation: No one is protecting our tax dollars with standard policies. That’s really, really not good.
We’re hearing all kinds of rumors about why the Chamber hasn’t fully cooperated with the City’s request for documents. We think the info will eventually come out and there will be a lot of problems exposed, including stuff like self-dealing and commingling of tax dollars with political funds. That’ll be really embarrassing if the Council has to deal with that and the Chamber is still managing the facility.
We hear the Chamber is hoping that the council members they’ve endorsed will support a 4-month “bridge” contract. Chamber CEO Nick Kaspar sent an urgent email this week to get people to lobby the council.
According to our sources, the Chamber is having an urgent strategy meeting this morning and are inviting some or all of their endorsed candidates. They’ve officially endorsed in past elections: Pat Kolstad, Patty Mahan and Teresa O’Neill.
Even if the Chamber-endorsed councilmembers stick together, there won’t be enough votes for a contract extension. There might have been a 4th vote for the Chamber if disgraced former Councilman Dominic Caserta’s seat was filled. But the Chamber shot itself in the foot (again) by buying an ad on the Weekly website that lobbied the council to leave the seat vacant. Whoops.
Let’s hope the City Council does the right thing and ends the Chamber’s “management” (or lack thereof) of the Convention Center and the CVB. It would be in the best interest of good government and better management of the Convention Center. The Chamber doesn’t seem to know what it’s doing. It’d be foolish to think they’re going to figure it out in four months.