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Thursday, September 18, 2014 |  Madison, WI: 62.0° F  A Few Clouds
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Is Monona Terrace worth it?
Assessing the costs and benefits after the first 10 years
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It was a public scolding, delivered with righteous indignation: "Once again, it appears that the zealousness of the opponents has served to overshadow the truth."

The date was Oct. 5, 1992, less than a month before Madison voters approved the $67.5 million Monona Terrace convention center, now celebrating its 10th anniversary. Dave Zweifel, editor of The Capital Times, tore into critics challenging assurances being made as to the facility's costs.

Center backers, he wrote, "insist that the 'absolute maximum' cost to a typical Madison homeowner would be $31 per year," including an annual operating subsidy and the construction loans borne by the city and county. Of this amount, the city's share was $23.56, for 20 years.

The critics said the actual cost would be about $10 a year higher. Zweifel savaged this claim, in a column headlined "Wright Center Foes Again Distort the Facts."

Meantime, center proponent Morris Andrews told Isthmus he was "very confident" the center's operating subsidy would be less than the $650,000 a year predicted as part of this cost calculation.

Referendums to build the center and borrow money for it passed by narrow margins. The facility opened on July 18, 1997, two years later than initially projected.

Those projections weren't the only ones that proved overly optimistic.

In 2007, the operating subsidy for Monona Terrace is budgeted at $2,925,631. (The subsidy closes the gap between projected revenues of $4,173,673 and projected costs of $7,099,304.) It's never been less than $2.1 million, and has averaged about $2.5 million a year since the center opened.

In addition, the city will this year spend $2,538,311 on debt service and capital costs, bringing its total outlay to $5,463,942. Minus payments from Monona Terrace in lieu of taxes, the city's net cost is $5,179,542. (For a spreadsheet with itemized costs since 1997, see this story at TheDailyPage.com.)

Madison's 9% room tax on hotels and motels covers all these costs. But, calculates city Comptroller Dean Brasser, "If the room taxes now applied to Monona Terrace were instead applied to other city operations, the property taxes on the average city home would be about $62.50 lower."

Brasser says there are statutory restrictions on using room-tax money for other purposes, and the city's room-tax rate is 1% higher than would be allowed if not for the convention center. Plus, room-tax revenues are doubtless buoyed by Monona Terrace.

Still, the $62.50 annual subsidy compares fairly against the $23.56 per year figure presented to taxpayers prior to the 1992 vote. Adjusted for inflation, $23.56 in 1992 would be just under $35 today.

In other words, the annual cost to city residents is now nearly twice what they were promised it would be.

To date, Monona Terrace has received $63.5 million in city funding. City taxpayers have also paid their share of Dane County's $12 million contribution. (This debt was retired ahead of schedule last year, says county Comptroller Chuck Hicklin. The interest came to just $3.6 million.)

The city's initial construction loans, says Brasser, won't be fully paid until 2020, for a total additional cost of $18.4 million. And the center's operating deficit and capital costs, now about $3.5 million a year, will presumably last as long as the center itself.

Monona Terrace backers, while not spotlighting these costs, insist the facility has been worth every cent.

The most recent fiscal analysis, released in February, concluded that Monona Terrace conferences and conventions had a total economic impact of $32.5 million in 2006, including $20.4 million in direct spending (mostly for hotels) and the rest in "secondary and spillover benefits."

These numbers, while substantial, are significantly lower than the $52.7 million total for 2005 touted in an analysis produced by the same consultant, Virchow, Krause & Company, in July 2006. Various downward adjustments were made to reflect market realities and available data.

The 2006 report also concluded that Monona Terrace has created 1,100 jobs. This is quite a feat, given that the center itself has just 58 full-time-equivalent employees.

And the report credits Monona Terrace with boosting property values downtown, at rates above the city average. Together with other developments, like new office buildings and a booming condo market, the study proclaims "a critical mass of new investment" reinvigorating the downtown.

Madison Mayor Dave Cieslewicz told The Capital Times last year that "a lot of these things would have happened anyway." But Cieslewicz, who opposed Monona Terrace in 1992 and voted against the county kicking in funds, nonetheless called it "a tremendous success," saying of his earlier position, "I repent."

Others haven't. Attorney Ann Fleischli, who filed several unsuccessful lawsuits in the mid-1990s to block the facility, still considers it an environmental blunder.

"They shouldn't have put it in a park, they shouldn't have put it on a landfill," says Fleischli. She also deems it "inappropriate for cities with dwindling resources to build palaces," when this money could be put to better use.

"I know people love to dance on top of it, but I don't think that's a celebration of what's underneath it."

Robbie Webber sees it as a case of bait-and-switch. Monona Terrace was sold to the public as a place where local folk would hang. The facility's name was even changed to reflect this: The Monona Terrace Community and Convention Center.

"They billed this as a community center, a gathering place, like the Memorial Union Terrace," says Webber, now a Madison alder. "I do not think that has at all come to pass."

Webber points to an artistic rendering of Monona Terrace, prepared prior to the 1992 vote, that now hangs in the Common Council office. It shows a facility crowded with people taking in the view and enjoying the space.

The reality, says Webber, is that "the best views of the lake and places people might want to gather are lopped off from the public or there is no seating." When she stops by, she always gets the sense that the employee stationed at the entrance to give directions "is there to guard it, like you're not supposed to be here."

Except for specific booked events, the center is a virtual wasteland. People do not come to sip drinks and take in the view, because no one is serving and there's no place to sit. Says Webber, "I'm disappointed in how it has turned out."

That may be a minority view of Monona Terrace, but Webber is entitled. After all, she's one of the people paying for it.

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