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ASU’s Omni project is a win-win for the university and economy


Few would disagree with the notion that generating new business opportunities and supporting education is good for the people of Arizona.

If we can agree that business and education are good, then it is no stretch to consider attempts to stifle these efforts as, well, bad.

I have spent much of my career in business and as a champion for economic development around Maricopa County. Because of my focus on creating jobs and opportunities in our community, I find the state attorney general’s lawsuit against the Arizona Board of Regents as a step in the wrong direction, and a position that stands against what the vast majority of Arizonans would view as the way our government should be operating.

Denny Barney

Denny Barney

The Omni Hotel and Conference Center planned for ASU’s Tempe campus, of which the attorney general disapproves, is a perfect example of how public universities can contribute to the local economy when given the freedom to do so.

The 330-room, four-star hotel will contribute over $32 million annually to the city of Tempe, according to estimates. Within the first three years of the agreement, the project will create some 300 construction and hospitality jobs. Omni will also enter into an agreement to help offset the capital cost of the Tempe Streetcar Project, an initiative important to the city of Tempe leadership and many taxpayers.

Similar university-hotel endeavors exist throughout the U.S. and here in Arizona. They provide universities, among other things, a place to do the work of convening capable and innovative people to work on and solve the problems facing our society.

And in this case, they provide the university with much-needed revenue – revenue that has been cut from the university’s budget.

The plan is win-win-win: ASU gets desperately needed funding through the payments in lieu of taxes to support its educational mission as a public research university, nothing is taken away from K-12 education and the community gets job creation, tourism and convention dollars and economic development from having a beautiful hotel in the middle of Tempe.

It’s a model that should be emulated.

The Omni is not the only place where this kind of innovative thinking is taking place. Another remarkable project underway in Tempe and enabled by an ASU public-private partnership is the Novus Innovation Corridor. Set to transform 330 acres of underutilized land into an energetic, mixed-use urban district, the project will extend from the northeast corner of ASU’s Tempe campus along Rio Salado Parkway toward Tempe Marketplace.

Novus brings renovated ASU athletic facilities, 4.2 million square feet of high-tech office space, nearly 4,000 residential units, over 660 hotel rooms, and many retail and entertainment venues. During the buildup, economists predict the creation of 22,000 jobs and over $3 billion in economic impact for the Phoenix metropolitan area. Once complete, estimates indicate that Novus will generate $4.5 billion of ongoing, annual economic activity and more than 34,000 jobs.

Public-private projects like Omni and Novus are good for two reasons.

First, they turn undeveloped land owned by universities into new streams of revenue. Revenue goes to fund the educational mission of our own world class public university founded in the East Valley of metropolitan Phoenix, but with a reach across the state of Arizona and country.

And second, the projects themselves build economic momentum for the region and produce the type of buzz that attracts businesses from out-of-state to Arizona. Universities add other attractive aspects for corporations that want to relocate here and need access to a skilled workforce.  A steady pipeline of talented college graduates close by also helps. This opens the door for internships, full time jobs and other opportunities to collaborate across a wide spectrum of activities.

Gone are the days when public universities could depend on significant state funding. They now have to be creative and dynamic in finding sustainable funding solutions. And let’s face it, universities have to compete. Attracting the brightest faculty, having modern facilities and employing the professional staff to keep everything running smoothly adds to the cost of doing business.

A judge will decide whether this lawsuit has merit. But there is a bigger issue at stake. In the end, either the universities will continue to have the liberty to create new streams of revenue and provide business opportunities to the community that lead to positive outcomes, or they will not. In any case the vibrancy of our new age economy for generations to come depends on it.

Denny Barney is president and CEO of East Valley Partnership.

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