DATE: Tuesday, August 26, 1997              TAG: 9708260356

SECTION: LOCAL                   PAGE: B4   EDITION: FINAL 

SOURCE: BY MAC DANIEL, STAFF WRITER 

DATELINE: CHESAPEAKE                        LENGTH:   68 lines

CONFERENCE CENTER WON'T BREAK EVEN, BUT FIGURES ARE IMPROVING, OFFICIALS SAY THE REAL BENEFIT CHESAPEAKE IS EXPECTING WILL COME FROM HOTEL AND RESTAURANT TAXES.

City officials admit that the new Chesapeake Conference Center - slated to open next week - will lose money.

But losses will be less than projected earlier this year, and the center is worth the cost, economic development department staff members will tell the City Council today.

On July 22, the council postponed voting on the conference center budget because city officials said they needed more time to review the proposed funding and cope with higher-than-expected bids for the center's food and beverage service contract.

Hotel and restaurant taxes were raised to help pay for the center, but it won't be enough, officials said. The facility is projected to run a deficit of more than $64,000 in its first year.

City officials plan to make up the shortfall with money from a $150,000 contingency fund.

Economic Development Director Donald Z. Goldberg said the center's spinoff benefits will outweigh its costs.

``These conference centers don't make money directly themselves,'' he said. ``It's the idea of what they encourage in the business community that's important - restaurants, shopping centers, spending money in the community.''

The increased meal and hotel taxes - expected to total $1.14 million - account for 44 percent of the center's annual revenue and helped reduce the projected deficit. The initial shortfall of $146,000 was cut after 1996-97 taxes were counted against this year's expenses.

The cost of running the center has also increased, however.

The food and beverage contract rose from an estimated $867,520 to $1.06 million - and now accounts for 40 percent of the center's expenses. The city's annual lease-rental payment of $722,750 - 27 percent of the center's expenses - remains unchanged.

The food and beverage contract was awarded to Tidewater Inn Management, a Virginia Beach-based firm that owns and manages a number of hotels in the region, including the Holiday Inn Chesapeake, which sits adjacent to the conference center.

The conference center is slated to open Sept. 2, with its first official function scheduled for Sept. 5.

Field lights: The council also plans Tuesday to consider spending $210,905 in city money to install outdoor lighting for a privately run Great Bridge baseball complex.

Under the proposed agreement with Great Bridge Baseball Inc., the city will install lights on three fields in the 90-acre Charlton-Mott Youth Complex off Eason Road.

The agreement states that the city will have secondary use of the lighted and unlighted softball and baseball fields and primary use of the nearby open space for city recreational programs.

The agreement also calls for Great Bridge Baseball Inc. to stop using lighted fields at Butts Road Primary School during the fall season. Those fields will be used for city-sponsored activities.

The 15-year agreement will let Great Bridge Baseball Inc. buy out the city's use of the property. ILLUSTRATION: MEETING

The City Council meets tonight at 6:30 p.m. in the Council Chambers

in City Hall.

A 5:15 p.m. work session is scheduled to discuss the latest capital

projects review and Va. Route 168 design and designation.

Call the City Clerk's office at 382-6151 for more information. KEYWORDS: CHESAPEAKE CITY COUNCIL

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