DN Editorial: UNCONVENTIONAL: The Center cannot hold, and that's bad news for the region
Management is wrong, the unions are wrong ... who cares? Business at the Convention Center is down, and that's a problem.
IF THE Pennsylvania Convention Center were an ocean liner, it would be taking on water and listing badly.
When the $1.3 billion taxpayer-funded facility at 12th and Arch streets opened a major new expansion in 2011, the promise was that a new, improved and larger center would draw 20 to 30 large conventions a year. There are 20 major conventions in the facility this year, but the numbers drop quickly after that - down to a mere eight in 2016.
This is bad news, not just for the center but for the region. Conventioneers pump $500 million into the regional economy each year and help sustain thousands of jobs in the hotel and hospitality industry.
Yesterday, the 15-member board of the state-owned center voted to take what its chairman said was an "important first step" in righting the ship - hiring a new captain.
The existing center management will be replaced by SMG, a private firm based in suburban Philadelphia that specializes in running centers around the country. The centers managed by SMG include San Francisco, Detroit and Chicago.
Some board members are skeptical that bringing in a new manager will solve the center's problems. There is no evidence that the existing managers are incompetent. They do a good job in a trying situation.
What they lack is control over the center's biggest problem: labor hassles and labor costs, which have turned off the people who organize conventions.
A consultant hired by the center put it this way: "It is clear that the primary issues facing the PCC - past, present and future - is its labor supply and their ability/inability to satisfy customer expectations."
To summarize the view of people who organize conventions: The Philadelphia facility is considered too costly, offers too many hassles and cannot deliver services at a reliable and predictable cost. Organizers tell tales of getting bills after the fact that far exceed their estimated costs - mostly due to unforeseen overtime costs.
Heather Steinmiller, one of Mayor Nutter's appointees to the center board, expressed skepticism at yesterday's meeting that bringing in a private firm would right the ship.
"Is this a change that will make things better?" she asked. "In my mind, it doesn't address our No. 1 problem, which is delivery of services on the show floor."
Union reps complain that they are getting a bad rap. They blame the existing management team for not enforcing the contracts with the six craft unions that work at the center.
In reality, it makes little difference who is right and who is wrong. The customers are unhappy and voting with their feet. They are canceling return engagements or simply avoiding the center entirely. Philadelphia competes in a national market.
Dozens of cities will be happy to get our business if they can deliver a hassle-free experience.
Gregory Fox, who heads the center board, said hiring SMG was only a first step. This month, the center also will open negotiations on a new customer-service agreement with the unions. He is confident the problem can be solved.
He better be right. If the center sinks, it will take a large and important segment of the local economy down with it.