Photo Credit: “Gaylord Opryland Resort & Convention Center – Nashville, TN” by Timothy Wildey / licensed with CC BY-NC 2.0
Back in 2017, Nashville, Tennessee, provided real estate investment trust Ryman Hospitality with about $13.8 million in tax breaks to build a waterpark at its Gaylord Opryland Resort & Convention Center. However, taxpayers weren’t able to access the park unless they stayed overnight at the four-star facility. The hotel limited waterpark access to hotel guests.
Today, with the novel coronavirus pandemic decimating the travel industry, leaving hotels everywhere desperate for revenue, the company is deigning to allow day-tripping local residents to use the attraction they subsidized. But only through September 3, and at a cost of nearly $50 per person per day. Parking is an additional $10.
It’s a perfect example of a city’s leaders making a bad economic development call with tax payer money, and then turning to those same taxpayers to bail them out.
The initial idea behind subsidizing the waterpark was to juice Nashville’s convention business, enticing families to come and stay a few days in the city beyond the convention itself.
But chasing conventions is a sucker’s game.
There’s a long history in the United States of cities building convention centers and then deciding they need to be even bigger and better to keep up with those being built in other cities. Kansas City, Missouri, for example, debuted a new convention center for the 1900 Democratic national convention. But by the 1920s, city business leaders were clamoring for a new one because, “We are gradually being eliminated from consideration through the lack of two important civic facilities now possessed by virtually all of the larger cities in the country … One is dining and meeting space in hotels … and the other is of course the lack of a convention hall with which to care for larger gatherings.”
A hundred years later, city leaders still think hosting more conventions is a way to get a guaranteed economic boost. But there are only so many big meetings to go around. As a result, cities literally need to steal them from each other in order to make the math work. For instance, the high point for Washington D.C.’s underwhelming, publicly-funded convention space between 2003 and 2010 came in 2005. Why? Meetings scheduled for New Orleans needed to find a last minute replacement after Hurricane Katrina ravaged the city.
All this history discourages no one. Instead of opting out and finding more sustainable ways to build local economies that don’t necessitate robbing other cities, politicians use this competition to justify a never-ending convention center arms race. That’s how you end up with taxpayers providing some of the funding for waterparks they can’t use.
Now the pandemic has halted the big meeting business entirely, leaving cities with convention centers that won’t be hosting any conventions, but that still need to be paid for. I’m not sure I could think of a more insulting move than to provide Nashville taxpayers with a short window in which they can pay through the nose to access an attraction they already subsidized based on an economic theory that was half-baked.
Nashville, like other Tennessee cities, is simply too reliant on corporate tax incentives, ones offered on terms that are too generous to the recipients. According to its most recent financial statement, it has 12 active property tax reduction deals with big companies, including Dell and Bridgestone, which cost it nearly $9 million last year. Per the disclosure, “None of these agreements include a provision for the recapture of abated taxes in the event an abatement recipient does not fulfill the commitment it makes in return for the tax abatement.”
So if the companies don’t fulfill their end of the deal, well, too bad.
As current Nashville Mayor John Cooper, who opposed the waterpark deal while on the city council, put it at the time, “Every time that we need something in the future for our districts — a reading instructor for children, a police man, a body camera or a stormwater drain — you will know where to find it. You will find it in an Opryland swimming pool.”
That’s exactly right, and describes how too many places across the U.S. operate: Giving corporations whatever they want, while the stuff taxpayers really need goes unfunded. In this instance, all Nashville got was a few days for taxpayers to play on waterslides — as long as they buy a ticket, that is.
Pat Garofalo is the author of The Billionaire Boondoggle: How Our Politicians Let Corporations and Bigwigs Steal Our Money and Jobs, the Boondoggle newsletter, and the director of state and local policy at the American Economic Liberties Project.