Ahead of a Friday deadline to submit a project agreement for the modernization of the Los Angeles Convention Center, a panel of City Council members advanced a menu of cost-saving measures to the $2.2 billion plan.
The five-member Economic Development and Jobs Committee unanimously approved a report from City Administrative Officer Matt Szabo that recommended certain construction that could be delayed or separated to lower the overall cost of the project.
According to a report from the Szabo’s office, city staff selected 56 ideas, totaling $124 million, that could be saved with an additional $27 million that requires further review.
City staff added that by reducing the scope of work it could also result in a reduction of about $10 million in annual debt service, which would help make the project more affordable for the city.
For example, the initial project proposal called for a redesign of Gilbert Lindsay Plaza with more public amenities, among other things. Under this reduced work plan, that redesign would be pulled, saving about $52.5 million.
Another item that may be removed from the project is a $19 million kitchen and concessions space, and other items are under review.
“That does not mean that the project will be sidelined or in any other manner won’t happen,” Szabo said. “What we’re recommending is that the project be handled on a separate track, and it not be rolled into the total cost that we would be issuing debt for and paying that off over 30 years.”
Initial reports estimated the city would be on the hook for about $4.78 billion over a 30-year period, including debt on loans used to finance the project.
City officials anticipate new revenue streams — e.g. additional parking and digital signs — would decrease the cost to the city to about $43 million a year, which may be reduced further based on these reductions to the scope of work.
The city is still working on getting approvals from the state for its proposed signage program, a key part of the project that makes it affordable. California has several laws that regulate outdoor digital signage to ensure that such structures are not disruptive to drivers and in neighborhoods.
Szabo noted that the state needs to pursue an update to an agreement with the federal government under terms of the Highway Beautification Act of 1965 to govern the signage.
“That agreement was established in 1968. So that agreement needs to be updated and that would secure certainty,” Szabo said. “We believe it can be finalized before we would recommend issuing debt.”
City Councilman Hugo Soto-Martinez, who sits on the committee, raised concerns about hiring consultants to assist with the project. He noted that even with additional assistance from outside groups there was information that feels “contradictory.”
The city has a nine-member consultant project team, led by Psomas, which serves as project executive consultant.
“I’m disappointed that, because for whatever reason, we still have a report that doesn’t have one person giving us what they think is the correct direction for this project,” Soto-Martinez said.
Szabo noted there were contractual issues that delayed some of the work on the report.
In April, the City Council authorized top city officials to re-engage in negotiations with Anschutz Entertainment Group Plenary Conventions Los Angeles, a joint venture that would oversee the project under a so-called “phased delivery.”
Construction would be expected to begin in September with completion slated for early 2029. City officials have discussed a plan to pause construction during the 2028 Olympics, ensuring that it would not impede the Games.
The modernization of the Convention Center is expected to create 190,000 square feet of contiguous hall space, up to 55,000 square feet of additional meeting room space and up to 95,000 square feet of multi-purpose space.
It would also provide 750,000 square feet of contiguous hall space and more than 1.2 million square feet of total usable space across the Convention Center campus.
With the city facing various economic challenges, elected officials requested staff to identify potential cost-cutting measures in the proposal, such as reducing the scope of work where possible.