A few more dollars tacked onto daily hotel room charges in Springfield could be used to expand the Bank of Springfield Center and boost the city's hospitality industry for years to come.
That option is among several potential uses for a tourism improvement district, or TID, that the director of the Springfield Convention and Visitors Bureau said he hopes will be pursued in coming months.
"I know this is the right thing to do," Scott Dahl told Illinois Times. "This gives us a real path to get an expansion done."
Dahl said there's cautious interest and enthusiasm so far among elected officials from Springfield, Sangamon County government and the municipal board governing the downtown convention center when it comes to the potential benefits of a TID.
If used to support borrowing to expand the BOS Center – Springfield's municipally operated convention center – a TID could pay for the construction of up to 120,000 additional square feet of convention space, Dahl said.
The project could be completed at a cost of about $100 million on land currently occupied by a 154-space, county-owned parking lot immediately south of the center and west of the Sangamon County Government Complex, he said.
Requests for convention space that Dahl's bureau – a city department – regularly has to turn down now because of limited options at the BOS Center would easily fill the new space, he said.
"The business is out there," Dahl said. "It's just going elsewhere now. I believe that we have the data that will show our turn-away business is enough to support a convention center expansion if conventions continue at the pace that they have for the past 15 to 20 years."
Convention business in Springfield, and hotel occupancy rates, have returned to levels seen before the COVID-19 pandemic, Dahl said. And even amid talk of a recession later this year, he said, "I can't imagine that the convention market is going to dry up."
An expansion of the BOS Center would free up additional space at the venue that could be used for entertainment acts, as well as conventions, making Springfield an even more attractive site for visitors who are in town for corporate events, he said.
The end result would be more jobs and economic activity for restaurants and other parts of the hospitality industry, more tax revenue for local governments and more entertainment options for Springfield-area residents, he said.
The slightly higher overall costs for hotel room rentals would largely be paid by out-of-town visitors and companies sending their employees to Springfield on expense accounts, Dahl said.
There's been discussion among city leaders for more than 10 years about ways of affording a major expansion of the BOS Center in the 200 block of South Ninth Street, he said.
Creating a tourism improvement district, one that Dahl would like to see cover all of Sangamon County, would be one way of accomplishing the goal without raising property taxes, he said.
The option of a TID emerged just this year. A bill signed into law in February by Gov. JB Pritzker allows Illinois to join about 20 states that allow the districts to support a range of efforts related to tourism. Included are marketing, affordable housing for tourism industry workers, bricks-and-mortar improvements and borrowing to finance employment for more workers in the tourism industry.
The districts, which would be created after hotel owners petition a local governmental body, must involve a tourism bureau and a specific plan for the use of proceeds from a separate assessment to be tacked onto hotel room bills. The new law limits the assessment fee to 5% of the room rate.
Rather than an overall increase in the hotel-motel tax that's split between city and state government, a special assessment would avoid money being diverted to other projects and would make it clear to guests that any additional fee is being used for their benefit, Dahl said.
Because of the many legal hurdles involved, TIDs take up to a year to create and would involve at least one public hearing, Dahl said. Planning for use of future revenues from hotel room assessments could take place at the same time, he said.
Dahl said he hopes that a unit of local government – either the Springfield City Council, Sangamon County Board or Springfield Metropolitan Exposition and Auditorium Authority Board – will commit sometime this year to pay the initial legal fees necessary to create a TID.
He said he will recommend that the California-based legal consulting firm Civitas be used to guide the process because of its expertise in helping to form 75% or more of the 207 TIDs in the United States over the past 20 years.
Civitas would be interested in working with Springfield, said Tiffany Gallagher, the firm's vice president of operations.
Civitas' website says tourism improvement districts nationwide "are raising over $300 million for tourism promotion."
The parking lot owned by Sangamon County government will become available for development in 2025 when a 650-space parking deck at the Sangamon County transportation hub opens, Dahl said.
If officials decide to expand the BOS Center, construction could be completed in 2027, he said.
Formal discussions with governmental boards haven't begun yet, Dahl said, but he is optimistic in the wake of initial, informal talks since House Bill 268 was signed into law.
"I haven't gotten any hard 'no's,'" he said. "Everyone was extremely positive. I feel confident the entities are going to be favorable to a TID."
Springfield Mayor Misty Buscher said she is open to the concept of a TID and "would embrace all of the conversations" and would expect the county's hotels, all of which are in Springfield currently, to be supportive.
"They do want their rooms filled," she said.
County Board Chair Andy Van Meter, a Springfield Republican, said the concept, though new to Illinois, would be an "intriguing possibility" if backed by hotel owners.
Darin Dame, president of the Springfield Hotel and Lodging Association, said the association hasn't taken a stance yet on a potential tourism improvement district. Its members are still educating themselves about the legislation, he said.
But Dame said: "We do think a stronger convention center is needed. ... We are losing conventions to other communities because our center is undersized."
State Rep. Mike Coffey, R-Springfield, a restaurant owner who serves as chair of the SMEAA board, said he is confident his board would back a TID if new funding would be generated to create more business for the city's hotels.
"I think it would revitalize the downtown," he said. "You're bringing in people who have disposable income. They have expense accounts. They're there to spend money."
Dahl said he hopes that a plan for a TID can move forward by the end of the year so Springfield doesn't have to wait in line behind other downstate communities, such as Champaign-Urbana and Peoria, for legal assistance from Civitas.
The economic impact an expansion of the BOS Center would have is "on par with" the impact of sports tourism expected with the anticipated opening of Scheels Sports Park at Legacy Pointe in late 2025, Dahl said. Sports tourism is projected to increase Springfield's annual average hotel occupancy rate to more than 60% from the current 55%.
When HB 268 was approved this year by the Democratic-controlled Illinois House and Senate, most Republicans voted against the plan in the House but not in the Senate.
Among those voting "no" were former Rep. Avery Bourne, R-Morrisonville, and former Rep. Sandy Hamilton, R-Springfield. Among those voting for the bill were Rep. Sue Scherer, D-Decatur, and Sens. Doris Turner, D-Springfield, and Sandy Turner, R-Beason.
State Sen. Steve McClure, R-Springfield, who voted against the bill Jan. 5, said he and some other Republicans didn't like the legislation requiring all hotels in a district to participate in a special assessment if the majority of hotels supported the assessment to create a district.
"It just goes against the freedom of each individual business," McClure said.
Dahl said he wouldn't expect opposition from Springfield hotels to a TID.
"I don't see that as a hurdle in Sangamon County," he said.
Dean Olsen is a senior staff writer at Illinois Times. He can be reached at [email protected], 217-679-7810 or twitter.com/DeanOlsenIT.
