Public/private partnership could fund new downtown Kalamazoo event center
The CEO of the Kalamazoo regional economic development organization said a public/private partnership could be the key to building a long-awaited publicly-owned downtown Kalamazoo event center.
Southwest Michigan First CEO Ron Kitchens is pushing for a proposed $110 million event center to be built between North Westnedge Avenue and Park Street near West Kalamazoo Avenue.
For more than a decade, Kitchens had pushed to get the project off the ground, but the plan has hit roadblocks along the way.
"We're the largest region we can find in the nation that doesn't have a modern event center. This is infrastructure just like not having an airport, which would dramatically damage our ability to compete and be relevant. This is hurting our ability to compete," Kitchens said.
If the state bill is approved, the Kalamazoo County Commission could vote to raise its local accommodation tax above the current 4% cap and use the new tax revenue to fund the event center.
Kitchens said pledges from the private sector could account for around half the cost of an estimated $110 million event center project.
"The private sector would take all the risk and use those motel dollars paid by visitors to provide what essentially what becomes a free gift for the entire community with zero risk to the taxpayers," Kitchens said.
Kitchen said the legislation, if approved, will allow Kalamazoo to develop a public-private partnership, much like the partnerships of the Kalamazoo Promise, the Homer Stryker MD Medical School and the Foundation For Excellence.
"A consortium of businesses and individuals have told us if the hotel-motel tax increases, they will provide the financial gifts and financial backing to ensure the project has zero risk for the county," said Kitchens.
Rep. Iden's bill would still need to pass the house and senate before going to Governor Gretchen Whitmer's desk. Then, the Kalamazoo County Board of Commissioners could vote to authorize funding for the project.
In 2018, Southwest Michigan First proposed a 1% food and beverage tax to go on the May 2019 ballot.
Back then, commissioners said residents largely asked the board to reject the proposal.
"Clearly it was the public funding piece that gave people heartburn," Kitchens said.
Kitchens said the facility is vital in retaining and attracting young families, but will require buy-in from the community and Kalamazoo County elected officials.
"There was some concerns I have, selling it to public is going to be hard but this plan was better with a 50/50 split public/private. That might be easier to sell to the public/taxpayers. With no restaurants in the tax that might make it more inviting to tax payers," said Kalamazoo County Commissioner Michael Seals.
A poll of 400 Kalamazoo voters by Lansing-based Marketing Resource Group, showed 77% of respondents would want an arena tax on the ballot.
"This is about changing the future of our employment base. It's not about a building, not about what sports teams play there, not about what concerts are there. Do we want a vibrant community where people under the age of 35 build their lives or do we want a community here or do we want to be an export?" Kitchens said.