Outside Erie

8 Responses to “Tourism Booming in Nearby Buffalo”

1. George Vietze
   October 6th, 2008 at 11:32 am

   The stock market will continue to go down because we are in a global economy and the value of the dollar compard to European currencies is a major problem. The run on European banks who, as of yet, have not taken steps to mitigate their economy. The bailout has not covered all the problems that the CDO’s and interest rate SWAPS that wall street devised to sell badly designed mortgages to investors globally.
   To explain, when wall street devised a way to securitize and package mortgage and sell them to investors, Wall Street devised a way to convince investors that it was safe to buy these mortgages by coming up with a type of INSURANCE to guaranty that these mortgage would be insured. The problem with using a typical insurance policy would be that Insurance would be regulated and RESERVES would have to be set aside IN CASH. These CDO’s and SWAPS are private contract between Wall Street and the buyers of these mortgages, the problem came when the real estate values crashed and the investors called upon the insurance contracts there was not enough money to pay the losses, hence these Wall Street comanies either went broke, were acquired or bailed out by the government.

   Erie now has finally decided to come up with a master plan around the Bayfront and the Convention Center and if the community joines in and follows through with the Plan we will then have something to develop to make the Bayfront and the Convention Center more viable.

   Buffalo does not have the kind of gambling and other attractions that are coming to Erie. The Governor and others have chosen Erie as the NW Pennsylvania hub. The State of Pa, in my opinion, has full gaming on the horizon and that will have a major impact on the Bayfront Plan and future development if it become reality. Together with the re-development of Erie’s downtown/midtown, growth of Erie’s base industries, Insurance, medical, tourism, manufacturing Erie is in the best position in its recent history to make a significant impact on its future economic viability. Erie will be affected, like everyone else but if we use this time to put our plans and policies in place, continue out re-development when this cycle ends we should be in a position to take advantage of the next upturn and if full gaming is approved in Pa. we should be able to attract more tourists from Canada and other places.
   It is about PLANNING and implementation. Manufacturing is not standing still, GE will expand their interest in Erie, they did not invest $15Million dollars in education for Erie if they did not have a long term plan, look for future investment in both manufacturing and energy, don’t forget we still have the WATER and we just put in place a water agreement that prohibits taking our water to help the places in the SW and other places that have a real water problem.

   Jim, in his post nailed that Pennsylvania had better become more friendly toward business if they expect to attract more business and the medical community needs major help or we are in danger of losing that business to other areas.

   I am happy to have moved to Erie because I believed in its future and I am convinced that the future is NOW.

2. Jim
   October 6th, 2008 at 2:51 pm

   I never looked at the convention center as any kind of a panacea, at least not to the degree it was sold to the public as. It is in an overbuilt industry, in a bad location, with little around it to complement it, and the taxpayer is on the hook for the risk associated with the hotel. Now that the economy is turning dramatically down, the risk to the tax payer here has suddenly, and dramatically increased, and done so at the exact moment in time that the county finds itself with budget problems. In other words the poorest possible time for the chickens to come home to roost.

   We have to change our thinking on spending and get some controls in place to control the rate of growth in government spending. That we are faced with having to ask prospective investor in the community to subsidize past spending habits from day one, is not an incentive for investment, something I’ve been writing about for a long time.

   Tourism is being oversold relative to the importance it has to the local economy. Scott mentioned in an article in the paper recently that his hotel properties do not see much of an impact from the MTR facility, as most of the gamblers tend to be day trippers, something we wrote about when Erie was busy trying to lure the facility away from Summit Township. While the facility might be bringing people to Erie to gamble, it apparently is not having much of an impact from the standpoint of tourism. What needs to be looked at however, is the difference between MTR and the convention center. One, MTR, is adding revenue to municipal, county and school district coffers, while the convention center is costing money. Neither is doing much for the tourism industry. That being the case, which makes a better case for public support in Erie?

   We need more MTR type projects, private development, with positive government cash flows, and less public financed projects like the convention center with negative government cash flows, if we ever want to gain control over the rate of increase in spending, and try to make ourselves a tad more competitive.

   Thinking back to the bay front meeting, it is imperative that if and when the GAF property gets redeveloped, it gets done in a way that is cash flow positive to government.

3. julio c reyes
   October 6th, 2008 at 5:49 pm

   Peter,

   It seems that we might have some help from the outside with better ideas about mass transportation in the region.

   I hope this guy is right and then when I am ready to cash in my investment in Erie a few years (15-20) from now is worth it a little more.

   http://www.goerie.com/apps/pbcs.dll/article?AID=/20081006/NEWS02/310069940

4. George Vietze
   October 6th, 2008 at 7:19 pm

   Convention Centers are a long-term investment to major communities and rarely cash/flow Return on Investments based only upon the cash invested by the community in the property but almost every major community has invested in its long term future by building a convention center. Like any other business it takes professional management, hotels and other attractions to maximize its potential to any community.
   The sooner the Bayfront Plan is implemented and the synergy of uses surround the Convention Center the more economically viable Erie Convention Center will be.

   Tourism may not be the only answer to the economy of any City but the
   City of Erie would be far worse off without the benefit of tourism. The hotel tax revenue increase is testimony to the rise in tourism and visitors and the fact that the Casino does over $40million every week (only recently has that number dipped below 40 million) it is not a stretch to say that the Casino contributed to those numbers. Tourism and visitors were not oversold to Erie, every visitor counts, they eat in our restaurants, shop in our shops, some stay in our hotels and all of them spend money to one degree or another. Gamblers spend money, not just in our Casino but they buy gas, eat food, shop and most of them go home and are not a drain on our economy. The Casino hires many workers, increase the horse industry in Erie and adds money to our local economy and our government. People who attend the Convention Center will also spend money, shop, eat in our restaurants, gamble in the Casino and occupy our entertainment venues. It is not one thing, it is the total sum of the parts, many hotel rooms, many attractions, Convention Center, entertainment venues, beaches, theme parks, Splash Lagoon, Family Sports Park.

   Erie not only has all these attractions, they have beaches, hotel rooms
   and easy access to a large population including Canada, that is why Erie was chosen as the hub of NW Pennsylvania. Full gaming is coming because we have all those amenities then we will have hotels on the lake, cruises to Canada, theme parks and indoor shopping on the Bayfront to add to our insurance industry, manufacturing industry,
   educational industry, medical community. This is not polyana optimism these are facts except for the full gaming projections, but that is based up conservative analysis and definitive behavior demonstrated by Harrisburg in its willingness to invest in Erie because Erie is the goose that is laying golden eggs that adds $1.5 million a week to its coffers.

   The increase of the quality of our lifestyle is part of the return on
   our investment. Hopefully the future will also put more value on our education and jobs as our economy grows.

5. Jim
   October 7th, 2008 at 6:35 am

   When discussing the hotel tax, you have to keep in mind that 80% of the proceeds go towards operations of the convention center authority, and their debt. Also bear in mind, that the vast majority of those revenues are collected outside the city, and the revenue is then transferred into the city. One can argue the overall merits of whether the convention center was a good idea, or will ever manage to pay its way (I don’t believe it will), but what cannot be argued that that it takes the entire county to subsidize another city asset. I really am at a loss to see the benefit to an Edinboro hotel in return for the subsidy it is forced to provide to a bay front convention center twenty miles away. It is just an added cost of doing business for them. Again, its a matter of limits. Currently there are no limits.

6. Danny Lucas
   October 7th, 2008 at 7:51 am

   Some people like the Bayfront Convention Center.

   In fact, THEIR word-of-mouth advertising is likely to be the best bet for future tourism , in this area, from far away folks.

   “Virginia is For Lovers” is a well known state slogan and it beats
   “Shoo Fly Pie of PA”, eh?

   But the lovers of Virginia, have the entire globe to conduct a wedding and reception. Where did they go?
   Erie, PA
   What did they say?

   http://www.goerie.com/apps/pbcs.dll/article?AID=/20081006/OPINION02/810060334/-1/OPINION

   These words will spread like a stone thrown in a pond and rippling outward.

7. George Vietze
   October 7th, 2008 at 8:04 am

   Las Vegas is one of the few convention centers that produce and return on investment. Erie alone has over 5,500 hotel rooms, certainly if FULL GAMING is approved and a bigger market can be established to increase Eries tourist business and large indoor shopping and potential theme parks and specialty shops and other attractions can be developed on or near the Bayfront and cruises to Canada together with the potential for high speed rail connecting cities within the radius of its market would enhance the ability of Erie’s Convention Center to become more economically viable. This is a long-term approach to thinking that requires vision and community and political support, I believe Erie NOW is working towards all that criteria. That is the reason why this forum and Envision Erie County is so important, if we do the same things over and over the same way how can we expect a new result. Jim’s thinking that all projects funded by the Government should require immediate ROI is important for the process, hopefully all major projects will have an Economic Impact Study to justify its support but if it is a long term project it needs to include long term projections, the future Erie will be different than the current Erie because Erie is just coming out of decades of slow economic growth.
   Just drive around the Bayfront and downtown area, can anyone believe that will stay that way? Sell your stocks and buy Erie real estate in well located areas in Erie, including downtown, midtown, Little Italy and Parade Street. Put together local investment groups and invest in your community, it is happening right before your eyes, don’t be blinded by the past, the future is NOW.

8. Jim
   October 7th, 2008 at 12:36 pm

   Erie does not have over 5,500 hotel rooms. Erie County does. Erie County has the city as only one part of it. The rest of the county is subsidizing the operation of these city based “assets”. There needs to be some reciprocal benefit to those businesses charged with collection of the subsidy. Gaming is entirely separate from tourism in my estimation. Scotts comments regarding the negligible benefit of MTR to rooms sold at his Summit township hotels should be an indicator. And look at the casino on I-86 in New York. Very successful, only one hotel, theirs, rest of the gamers are day trippers and a lot of bus activity.

   Again my point is, higher economic returns for less subsidy is the key to planning efforts. Plan to maximize revenue at the lowest possible public cost. And costing should be divided between initial investment and ongoing operating costs. Initial investments can be more easily justified, if there is realistic expectations for meeting annual operation and maintenance costs. A high initial investment cost for a project that can neither operate or maintain itself, is too costly a consideration at this point. We’ve been there and done that.