Study: Republican National Convention put $214M directly into Tampa Bay economy

Mitt Romney and Paul Ryan take to the stage at the end of the 2012 Republican National Convention at the Tampa Bay Times Forum.
Mitt Romney and Paul Ryan take to the stage at the end of the 2012 Republican National Convention at the Tampa Bay Times Forum.
Published Aug. 21, 2013


The winners include hotels, Tampa International Airport, bakeries, florists and companies that sell the kind of fresh gulf seafood tourists like.

The losers: restaurants and bars, which saw so many regular customers stay home that sales either lagged behind the rest of Florida or dropped.

Mostly, though, it was a picture to make officials smile: Last year's Republican National Convention pumped more than $214 million directly into the Tampa Bay area's economy, according to a business impact study commissioned by the local host committee and released Tuesday.

And as that money was spent and respent locally, the total direct and indirect impact of the convention on the bay area added up to $404 million, the study concluded.

But the RNC did more than ring cash registers, officials said. With 50,000 visitors in town, protests expected, media everywhere and Tropical Storm Isaac threatening, it also proved something about the bay area.

"You knew with certainty that this was a pivotal moment," Tampa Mayor Bob Buckhorn said at a news conference to unveil the study. "How we performed on that international stage was going to determine, probably for decades to come, what the world thought of us."

What the convention said, Buckhorn added, was "that if we put our minds to it, there is nothing that can get in our way."

The biggest chunks of the convention's direct spending included:

• $125.3 million in upgrades to telecommunications and utility infrastructure by AT&T, Verizon, Sprint and TECO Energy.

• $37.5 million spent locally — much of it on paying, equipping, housing and feeding a coalition of law enforcement officers — by the city of Tampa, which received a $50 million federal security grant for the convention.

• $28 million by the local host committee and the national Republican Party on construction at the Tampa Bay Times Forum, hosting the kickoff party at Tropicana Field and other convention preparations.

• $18 million spent by delegates and other visitors on hotel rooms.

By comparison, the host committee for the 2008 GOP convention in St. Paul, Minn., reported a total impact of $168.2 million — $153.7 million in direct spending and $14.5 million in indirect spending.

The Tampa study was done by Brian T. Kench, chairman of the department of economics at the University of Tampa. It looked at business activity in eight counties: Hillsborough, Pinellas, Pasco, Hernando, Citrus, Manatee, Sarasota and Polk.

The study estimated that the convention increased taxable sales around the area by $363 million during August 2012 compared with August 2011. That 3.2 percent increase came on top of the growth in sales the rest of the state also saw for the month.

But compared with August 2011, sales at restaurants grew, but couldn't keep pace with the rest of the state and sales at bars were down 14 percent, possibly because of the "crowding out" effect that economists say huge events have on normal patterns of business.

While August is a slow month for tourism, the study concluded that a few non-convention visitors stayed away because of the RNC. Also, many downtown workers stayed home, and tight security discouraged or even blocked patrons from some businesses near the convention site. Overall, spending at affected businesses took a $2.3 million hit.

"I expected to be up 25 percent, not down 25 percent," said Steven Ashworth, who owns Ashworth Artisan Chocolate in Hyde Park Village. "That was a big letdown."

Not only did his shop, formerly known as City Street Sweets, not get any convention business, but regular customers stayed away, too.

"Customers were calling to see if they could get to our store without traffic problems," Ashworth said. "If they lived five or 10 minutes away they were afraid there would be too much traffic."

Buckhorn believes that kind of disappointment was isolated and some businesses had the "very best week that they have ever had."

"We tried to tamp down expectations going into this because we knew that was the experience at other conventions," he said. "We knew that some folks would make the decision not to come downtown" and "there was nothing we could have done to change that."

While not everything was rosy, Buckhorn said the study shows that "for the vast majority of folks in the Tampa Bay area this was a huge economic stimulus the likes of which we will probably never see again."

Still, not all economists agree that national political conventions clearly boost the economies of their host cities. Three economists who studied 18 national political conventions going back to 1972 concluded in 2008 that the conventions had a negligible impact on employment and personal income of host cities compared with cities that did not host conventions.

One of those economists, Victor Matheson at the College of the Holy Cross in Massachusetts, read Tampa's RNC study Tuesday and said parts of it are good but one number raises a red flag — the $125 million spent on telecom and utility upgrades.

That work might have been moved up a bit to be finished for the convention, Matheson said, but it's the kind of spending that has to be done anyway for those companies to stay competitive in their fields.

"Counting that as economic impact that's a result of the convention is absolutely ludicrous and kind of throws the whole report into disrepute," Matheson said. "That's half your economic impact right there."

Tampa Bay Host Committee president Ken Jones said the $125 million was "directly convention related" and that the committee took care not to inflate its numbers.

The private sector actually spent $291.5 million on infrastructure improvements for the RNC, according to the study, which backed out spending that took place outside the bay area.

"These are improvements that would not have been done except for the fact that the Republican National Convention was in Tampa," Jones said. "These are what I would call extraordinary expenditures."