Concerns about convention center financing process addressed at Measure J commission meeting

A city-hired consultant and Palm Springs’ finance director on Thursday walked the Measure J Oversight Commission through updated financing and design details for the planned $135 million Convention Center modernization, prompting questions about process and the project’s impact on Measure J funding.

Mark Waier, a principal with Daley Strategies, outlined the scope of the project, which includes a $52 million renovation of the convention center’s west side, a $60 million expansion on the east side, and $23.4 million in pedestrian connectivity improvements. The facility, originally built in 1974 and last expanded in 2005, requires significant upgrades to remain competitive, according to a futures report commissioned by the city.

Waier said Palm Springs lost more than 278,000 hotel room nights between 2010 and 2023, a decline driven in part by COVID-19 but also by feedback from meeting planners who say the center lacks flexible space and modern technology.

Palm Springs Director of Finance and Treasurer Kristopher Mooney then addressed how the project would be financed, telling commissioners the city plans to seek Measure J funds to help cover debt service, though specific amounts have not yet been finalized.

Mooney said the city is also pursuing the creation of a Tourism Improvement District that would impose a 1% assessment on lodging stays, generating an estimated $4 million annually and helping to limit pressure on the city’s general fund.

Commissioner Larry Isaak questioned how much Measure J funding would remain available for community-initiated projects and said the commission should have been consulted earlier in the process.

“I was disappointed that we weren’t consulted,” Isaak said, referring to the City Council’s prior approval to move the project forward. “Now tonight, we find out that more of our money is going to be set aside for debt service.”

Mooney said existing Measure J commitments — including street improvements, downtown revitalization debt, library debt, and planned fire stations — would continue. “Nothing is interrupted by adding the convention center debt,” he said, while acknowledging that the project would reduce funding capacity for future projects.

Isaak said his concern was procedural rather than substantive. “I’m supportive,” he said. “My concern has been with the process.”

Mooney said staff understood the commission’s frustration and committed to keeping commissioners more closely informed as the project advances, including providing monthly updates before any formal Measure J funding request.

Waier said the proposed Tourism Improvement District would require approval from lodging property owners representing more than 50% of assessed revenue. He said large hotels, small hotels, and short-term rental operators have all indicated support, with a petition drive expected to begin within the next week and conclude by March.

Restaurants were initially included in the TID proposal but were removed earlier this month. Waier said the change was made due to administrative challenges and concerns about shifting costs onto local residents rather than visitors.

Construction is currently targeted for completion by 2028. Mooney said the aggressive timeline is intended to minimize lost tax revenue, noting that Palm Springs has already lost conventions to competing destinations, including large resort facilities in the San Diego region.

Planned improvements include converting the eastern ballroom into more flexible meeting space, adding outdoor gathering areas on both sides of the facility, and building shaded pedestrian connections linking nearby hotels and downtown. A 30,000-square-foot expansion would allow the convention center to host larger conventions or multiple events simultaneously.

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