Why does Gastonia need a conference center?
The Gastonia Conference Center serves a large role in our City and Downtown Gastonia. The Conference Center serves as a catalyst for economic development. The facility provides services to our business and industrial community, as well as hosting weddings, proms and other social occasions.
I don’t use the Conference Center so why are my tax dollars going to support this project?
The Gastonia Conference Center is a resource for the community. It is not funded through property tax dollars. The Gastonia Conference Center is funded with Gastonia’s portion of the Hotel Occupancy Tax. This tax is paid by visitors occupying hotel rooms in Gastonia. Both the debt service and operating budget are funded with Hotel Occupancy Tax. Gastonia property taxes are not used to fund the Gastonia Conference Center.
How is the City prepared to fund the upcoming increase in the debt service payments from the construction of the facility?
Gastonia has planned for the increase from the beginning to ensure that it was adequately funded each year. Gastonia has revenue in the Hotel Occupancy Tax fund balance (savings) to pay for the increase in debt service and the annual operating budget.
Why doesn’t the City refinance the debt to save money?
The Conference Center’s construction was financed by the City issuing taxable Limited Obligation Bonds (Recovery Zone Economic Development Bonds). By issuing the debt this way, the City receives a 45% interest subsidy. Basically, the City pays the interest payment, files a return and gets 45% back. So there are substantial interest savings with this debt issue. That is why it doesn’t make financial sense to refinance this debt.
I keep hearing that the current management company is successful, but the building is still operating at a loss. How is losing money successful?
Research has repeatedly shown that public facilities of this nature do not produce profit. The goal for the facility is to achieve a net zero loss by increasing revenue and operating efficiently. The City monitors the financial health of the Gastonia Conference Center monthly.
Why does the City hire a management company? Could this service be provided cheaper by City staff?
To maximize the revenue generated at the Gastonia Conference Center, provide the highest level of hospitality services and support the care of the overall facility, it is important to use the services of professionals that are trained in the hospitality and food/beverage industry.
Why is there not a special rate for non-profit organizations?
The Gastonia Conference Center provides its services in an equitable and consistent manner for all of its clients. The Conference Center sales staff offers a variety of price points and makes an effort to work with each of its clients to provide services that work within their budget.