Gov. Martin O?Malley?s proposed budget cuts would drop all state aid to Maryland?s two major convention centers, funding that comprises two-thirds of the Baltimore center?s annual payments and half of those for the Ocean City center.
Local convention officials and national analysts said the cuts could end up costing the state and city far more than they?d ever save.
O?Malley on Tuesday unveiled the budget cuts he?d have to make unless the General Assembly passes his proposed tax increases and revenues measures in a special session beginning Monday.
The governor?s plan would end $4.2 million in state funding toward the Baltimore Convention Center?s deficit, and $1.5 million for the Ocean City Convention Center, according to a breakdown of cuts released earlier this week.
“The fact is, if you don?t get revenues, you have to make cuts,” said Frederick Puddester, chairman of the Maryland Stadium Authority. The MSA was the contractor for both centers, and the state aid is included as part of the MSA?s budget.
“The reality of the situation is if the governor and General Assembly don?t come together on a package of revenues, cuts likethis will have to be made,” Puddester said.
Puddester said the cuts represent two-thirds of the Baltimore Convention Center?s deficit funding and half of that for the Ocean City center. Baltimore City and Ocean City?s local governments would have to make up the shortfall out of their own pockets. The centers might opt to raise their prices to make up some of the funding, but Puddester said the competitive nature of the industry and contracts signed years in advance might prevent much of an increase.
Still, any increase or change in the convention centers? operations or their funding could in the long run cost the state more in lost convention business than it saves with the budget cuts, said Deborah Sexton, president and chief executive officer of the Professional Convention Management Association, a national association connecting convention organizers with convention venues.
“You have a new president of [Baltimore Area Convention and Visitors Association], Tom Noonan, and kind of a new energized thrust back into that marketplace,” Sexton said. “When you have a new person building a new direction, there couldn?t be a worse time for that to happen.”
