Sizing things up

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A couple of facts for everyone afeared that Expo Square will lose its competitive advantage if the City annexes the Fairgrounds, subjecting it to city sales tax, and all the boat shows, car shows, RV shows, etc., will relocate to the new downtown arena.

From the Expo Square website:

The Expo Center provides 354,000 square feet of column-free space under a cable-suspended roof. The building spans 448,400 total square feet on two levels, connected by side ramps and stairs. This design allows for a unique variety of show floorplans and designs.

(For the benefit of old-timers like me, the Expo Center is the IPE Building.)

From the Oklahoma Ford Center website:

Arena Floor: 34,074 square feet (144'x 260')

(I can't find planned dimensions for the BOk Center floor, but I assume they'd be comparable.)

So you could fit 10 BOk Center floors inside the Expo Center. There is no other space in the Tulsa area that can accommodate the kinds of events that are held at the Expo Center. The closest in size is the Tulsa Convention Center exhibit hall, which is 102,600 sq. ft., but I suspect it has floor loading limits that don't apply at the Expo Center, which was built to exhibit enormous pieces of oilfield equipment.

Likewise Expo Square has a beautifully restored art deco Pavilion, which is the right size for minor-league sports events and smaller concerts, and state-of-the-art horse and livestock barns and show arenas, all surrounded by plenty of free parking.

A lower sales tax rate is not Expo Square's competitive advantage over facilities in other cities or in our own metro area. The facilities are Expo Square's advantage, and annexation doesn't change that.

I got a description of the annexation discussion at last night's City Council meeting from someone who watched it. A bunch of county and Expo Square officials lined up to say, "This is bad for both of us! You better think about this before you do it!" But the county officials didn't offer anything substantive to think about. They didn't provide any data to analyze -- just a heapin' helpin' of FUD.

(Wouldn't it have been cool if the county commissioners had then lined up to do Aretha Franklin's number from The Blues Brothers?)

I'm hopeful that our city councilors will respond just like Matt "Guitar" Murphy did.

UPDATE: Be sure to read Commissioner Fred Perry's reply in the comments below.

Perry drew a comparison between the State Fair Park in Oklahoma City and Expo Square in Tulsa. Here is a montage from Google Maps, at the same scale, of the two facilities -- Oklahoma City on the left, Tulsa on the right. The larger buildings on the southwest corner of State Fair Park, all grouped together, are all livestock barns. The oval building is State Fair Arena. The smaller buildings in the center are State Fair Park's exhibit buildings; they have nothing to compare with Expo Center's 350,000 sq. ft. of unobstructed space.

Oklahoma City and Tulsa fairground comparison

And since the Louisiana Superdome has been mentioned as an example of a sports arena hosting boat shows, RV shows, etc., it's worth pointing out that the Superdome is a domed football stadium, not a basketball/hockey arena. The Superdome has a floor area of 166,464 sq. ft. (408' x 408'). That's five times larger than the floor of an arena like the BOk Center.

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12 Comments

Jeff Shaw Author Profile Page said:

Well, which one ordered the 4 fried chickens? Ms. Miller or Mr. Perry.

- Speaking of FUD, maybe you could find Robin Williams doing Pink Cadillac as Elmer Fudd.

XonOFF said:

>>There is no other space in the Tulsa area that can accommodate the kinds of events that are held at the Expo Center.

The IPE building used to be billed as "the largest open floor area in the country". I presume since it's 1960's construction, something larger has emerged. But, there's no question, it's darn big.

Oddly, Air Force Plant No. 1 is three times larger than that. But, it's not open floor area.

Your quite correct in that nothing can compete with it, especially locally, or regionally.

Dan Hicks said:

Michael,

The annexation issue is very simple.

The Tulsa County Fairgrounds belongs to all of Tulsa County. Business conducted at the fairgrounds is currently not subject to Tulsa sales tax. If annexation is approved, a new tax will be imposed. By definition, this is a TAX increase and it should be opposed by those who call themselves conservatives.

Tulsa needs to prioritize spending instead of taking the SOCIALIST way out. Annexation is nothing more than a Tulsa TAX grab.

Dan Hicks

LaFortune Park belongs to all of Tulsa County, too, and when we were kids, it was surrounded by the City of Tulsa but wasn't within the city limits. Sometime in the early '80s, the City of Tulsa annexed LaFortune Park. It's still owned by the County, but it is subject to the same laws as all the surrounding territory. It still seems to be doing fine.

Taxes aren't the only issue at stake here. Those of us who live near the fairgrounds want to make sure that the fairgrounds property is under the same rules for criminal activity, noise, nuisances, and land use.

Right now, there is no check or balance on what goes on at the fairgrounds. If the fair board (the County Commissioners and their two appointees) approves an activity, only the County Board of Adjustment (appointed by the County Commissioners) has to give approval if a special exception or variance is required. If there's a zoning change, the County Commissioners make the final decision. This allows the County Commissioners to approve any activity with no consideration for its impact on the surrounding neighborhoods.

Dan, I'm sure you don't think it's fair to QuikTrip or other small groceries to have to compete with businesses who have special tax breaks because they're located on tribal land. Is it fair to privately owned entertainment businesses to have to compete against entertainment businesses who get a special tax break because they lease land from a governmental entity? Is it fair that those businesses benefit from the same city services without paying the same amount of taxes?

Finally, Dan, shouting "SOCIALIST" is not a substitute for rational argument. It certainly isn't a persuasive argument.

Fred Perry said:

My friend,and oft time ally in the past, Michael Bates,and I are not on the same page on the subject of annexation.He's wrong when he says the county commissioners didn't offer anything substantial at the council meeting the other night.He must not have listened to the whole presentation.Here are some examples:(1)The Tulsa fairgrounds did 50% more events last year than the OKC fairgrounds (398 vs.191) even though the OKC fairgrounds has more buildings,more square footage and more acres of space (428 vs. 240).The difference, acknowleged by Bill Allen the CEO of the OKC fg is the lack of a sales tax.While it is primarily perception, the lack of a sales tax does attract people and events. (2)The City will have to provide security if the annex the fg.The mayor's own analysis says this will be a $500,000 expense.This is greatly understated because that is the county's expense.The city pays its police (due to the union)much more and the overtime bill will be very high.Also,the sheriff's deputy volunteers, who supplement the deputies at the fair, work for nothing.Even using their $500K figure,this will cut the $386k to $1.1 benefit to the city considerably.How do they plan on making it up?By charging a fee to the fg tickets.So, what we will have is a DOUBLE tax and the second one doesn't have a vote of the people.(3)One city councilor,and my friend Michael, talks about "fairness".He ignors the fact that the county runs the jail and charges the city nothing (a multi-million dollar value). Also, the fairgrounds is far and away the biggest destination point for hotel room rentals.The hotel tax goes to the city and the chamber of commerce; NOTHING goes to the county.So, the city is being compensated and this doesn't even take into account the sales tax that out of towners pay for other goods and services.(4)The fairgrounds won't be able to function with the slow permit process of the city.Temporary buildings (even tents)are a routine,almost weekly reality,at the fairgrounds.The city's building inspectors will take away the responsiveness that event sponsors now enjoy at the fairgrounds and that,along with the sales tax,will hurt the fairgrounds responsiveness. (5)Back to the security issue:Everyone says Tulsa needs more cops.Fairgrounds security by the TPD will take cops off the street.There,Michael,are the "substantive issues"which were offered at the council meeting...Fred Perry,County Commissioner,Dist.3

Dan Hicks said:

Michael,

I find it interesting that you want to have your cake and eat it too.

Above, in the body of your article, you argue that the lower sales tax is not the competitive advantage. In your rebuttal to my earlier comment, you argue that the lower sales tax does create a competitive advantage. Which is it? If you want to talk about arguments that are not rational, please explain how taking two contradictory positions on the same page of your website is either logical or rational.

The fact of the matter is that the lower sales tax does create a commpetitive advantage and it is this competitive advantage that makes it work so well as an economic engine. You suggest that this competitive advantage is somehow unfair, but your agrument is again flawed. All Tulsa businesses, including QuikTrip, have the right to put on an event or trade show at the fairgrounds and take advantage of the lower taxation. No one is being denied access. Just because some businesses choose not to take advantage of the opportunity at the fairgrounds, you cannot say that there has been some miscarriage of justice.

I have heard both you and Rosco argue that the lower tax creates an unfair commpetitive advantage and then tell us moments later that if Tulsa sales tax is imposed, no fairgrounds customers will be lost. If the people who are shopping at the fairgrounds instead shopping at other Tulsa businesses today will continue to shop at the fairgrounds rather than shop at those businesses in the future, even if the tax is raises, how is the lower tax an advantage. What you and Rosco are saying is that not one singe fairgrounds customer will change his shopping habbits and make a purchase some other local business even if the tax goes up. How does annexation then change the terrible unfairness to other local businesses you and Rosco seem to think currently exists? Seems to me that your argument is going in circles.

Bottom Line:

Does the lower tax rate create a competitive advantage? Yes! That is why the Tulsa County Fairgrounds is so successful.

Is this Fair? Yes! All have access to take advantage of this opportunity.

Is annexation a TAX increase? Yes! Tulsa sales tax is not being imposed now. Annexation will impose a new tax. The result by definition is a TAX increase.

Michael, we may not be on the same side of this issue, but I believe the thinking process I have used to arrive at my position is rational.

Thanks for including me in your blog.

Dan Hicks


Bob said:

Most people operate on a budget, at least implicitely.

For those with credit, if expenditures temporarily exceed income, they can temporarily resort to their line of credit.

For those WITHOUT available credit, then they must either buy LESS, or buy less EXPENSIVE goods. Those are their ONLY choices. Well, just MAYBE the Boss will give them an instant raise, right?

What has always intensely puzzled me when the city and county have repeatedly agitated for higher SALES taxes, which we know are the most REGRESSIVE Tax against Low-to-Moderate income groups, is why the local RETAILERS don't stand up against the new/renewed sales tax? Under the reasonable assumption that they will actually LOSE sales every time sales taxes increase, as described above.

The local retailers would appear to be the net LOSERS when SALES taxes are raised. Yet, they consistently stand silent when the Metro Tulsa Chamber of Commerce PACS: Citizens for Tulsa/Citizens for Tulsa County, agitate for new and renewed sales taxes.

Is it because some of the local retailers see an OPPORTUNITY to increase their profits by CHEATING on their sales taxes remittances to the OTC?

At 8.517% tax on every dollar spent for goods within the City of Tulsa, that is a HUGE additional PURE PROFIT margin added to their bottom line.

I would think that the TEMPTATION would be irresistible for certain retailers who simply keep three sets of books:

One set of books for the OTC, one for themselves, and another for the IRS.

The PARTICULAR retailer that I'm thinking of was sired in the Premordial, Ethically-Challenged goo of ARKANSAS.........

Simply irresistible!

Commissioner Perry, thanks for stopping by with your comments. I only have time to respond to a couple of points that you and Dan made.

State Fair Park does have more acreage, but a good chunk of it is undeveloped. Developed area is very close to that of Expo Square.

The biggest exhibit building at the Oklahoma State Fair Park is 70,000 square feet. There is nothing at State Fair Park to compare with Tulsa's 354,000 sq. ft. Expo Center. The biggest buildings at State Fair Park are barns, which were upgraded with money from MAPS. Tulsa's barns were completely replaced with Four to Fix 2001 and use tax funds. Our fairgrounds facilities are far superior to those of Oklahoma City.

Dan, there are two different competitions at work, which I didn't set out as clearly as I should have. There's the competition between Expo Square and other convention and exhibition facilities for events -- the quality, size, and configuration of Expo Square's facilities give Expo Square an advantage over similar venues in the region.

Then there's the competition between businesses that operate at Expo Square and businesses that operate in the City of Tulsa, competing with each other for the disposable income of Tulsa area residents. Big Splash, the Drillers, the 66ers, Fair Meadows, and the simulcast facility compete with movie theatres, Celebration Station, Incredible Pizza, restaurants, the Talons, the Oilers, and other businesses that sell entertainment and recreation.

Dan, you say that "All have access to take advantage of this opportunity," referring to the opportunity to operate at Expo Square. I think the Bell family would disagree with you on that point.

You can only do business at Expo Square if the owner, county government, allows you to do so. While I am confident that the new county commissioners won't play political favorites with Expo Square leases, the previous commissioners certainly did, and the potential for favoritism remains. There is only so much space available on the fairgrounds.

D.Schuttler said:

It's odd that the same Thursday Randi Miller was on KRMG during the morning. Her statment ( to the best of my recollection) that the new commisioners are too new to make decisions that might effect the Counties budget. Obviously she was talking about a different subject but it should stand for this decision too.

By the way in 1998 the Houston boat show was held in the old AstroDome. Not sure when the moved to the new dome...

Dan Hicks said:

Michael,

Your passion in defending this annexation is very perplexing to me.

I believe that having an island in the middle of this city where we can make a purchase and escape the confiscatory taxation imposed by our corrupt city government can only be discribed as a good thing.

When I listen to the arguments you and Medlock are making, it sounds like you don't mind paying more taxes just as long as the government is sticking it to us all equally.
Perhaps I misunderstand your position.

I had never herd anyone express concern about the competitive advantage at the fairgrounds being a bad thing until the City of Tulsa mismannaged its budget to the point that leaders saw annexation as an easy way to get their hands on some money.

I would venture to say that if annexing the fairgrounds were shown to cost the city money, your friends on the City Council would drop it like a hot potato. All the concerns you have expressed about noise, police protection, and competitive advantage are not really what is driving this annexation train. In truth, it's all about the dollars.

Your motive may be equity, but for Rosco and the boys, it's "Show Me The Money."

Dan Hicks

XonOFF said:

Cost of Fair Security is a overhead expense of the Fairgrounds Trust Authority, operators of the Fair.

Whom they contract to actually do the work is their choice. In years past, it's been the Tulsa County Sheriff's Office.

After annexation, the responsibility remains with the Trust Authority, along with the expense. And, they still choose from whom to contract the service. Ostensibly, by even Mr. Perry's description of the cost advantages, that would tend to be the Tulsa County Sheriff's Office again.

If TPD were to be contracted, then the Trust would be providing an additional $500k for the expense. This would not be subtracted from Sales Tax take.

Or, guess they could use Wackenhutt or another security service. IAC, the expense remains with the Authority.

Fred Perry said:

My friend,and oft time ally in the past, Michael Bates,and I are not on the same page on the subject of annexation.He's wrong when he says the county commissioners didn't offer anything substantial at the council meeting the other night.He must not have listened to the whole presentation.Here are some examples:(1)The Tulsa fairgrounds did 50% more events last year than the OKC fairgrounds (398 vs.191) even though the OKC fairgrounds has more buildings,more square footage and more acres of space (428 vs. 240).The difference, acknowleged by Bill Allen the CEO of the OKC fg is the lack of a sales tax.While it is primarily perception, the lack of a sales tax does attract people and events. (2)The City will have to provide security if the annex the fg.The mayor's own analysis says this will be a $500,000 expense.This is greatly understated because that is the county's expense.The city pays its police (due to the union)much more and the overtime bill will be very high.Also,the sheriff's deputy volunteers, who supplement the deputies at the fair, work for nothing.Even using their $500K figure,this will cut the $386k to $1.1 benefit to the city considerably.How do they plan on making it up?By charging a fee to the fg tickets.So, what we will have is a DOUBLE tax and the second one doesn't have a vote of the people.(3)One city councilor,and my friend Michael, talks about "fairness".He ignors the fact that the county runs the jail and charges the city nothing (a multi-million dollar value). Also, the fairgrounds is far and away the biggest destination point for hotel room rentals.The hotel tax goes to the city and the chamber of commerce; NOTHING goes to the county.So, the city is being compensated and this doesn't even take into account the sales tax that out of towners pay for other goods and services.(4)The fairgrounds won't be able to function with the slow permit process of the city.Temporary buildings (even tents)are a routine,almost weekly reality,at the fairgrounds.The city's building inspectors will take away the responsiveness that event sponsors now enjoy at the fairgrounds and that,along with the sales tax,will hurt the fairgrounds responsiveness. (5)Back to the security issue:Everyone says Tulsa needs more cops.Fairgrounds security by the TPD will take cops off the street.There,Michael,are the "substantive issues"which were offered at the council meeting...Fred Perry,County Commissioner,Dist.3

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This page contains a single entry by Michael Bates published on February 9, 2007 5:07 PM.

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