That's the question the County Council will raise today as officials consider creating an exploratory committee to figure out whether a Salt Palace hotel makes financial sense for Utah's capital and whether public funds should support it.
The hotel would rise within easy walking distance of the Salt Palace, offering convention-bookers 1,000 rooms, about 90,000 square feet of meeting space and full-service accommodations, including fine dining, gift shops, fitness centers and an indoor swimming pool.
It would provide more bed space than the city's largest hotel, Little America, which offers 850 guest rooms four blocks away.
"This is the single most important step we can take as a destination now that we have change in the liquor laws," said Scott Beck, president and CEO of the Salt Lake Convention & Visitors Bureau. Beginning July 1, bar patrons no longer will be required to purchase a private-club membership.
The proposed hotel's location remains uncertain -- officials may even decide not to pursue the project. However, a recent private-sector marketing study identified three possibilities: A parcel near Japantown on the Salt Palace's west side, another on the southwest corner of 200 West and 200 South and a third across the street from the convention center on West Temple between 100 South and 200 South.
But this question must be answered first: Is the hotel a prudent taxpayer investment?
Councilman Joe Hatch will recommend forming a study group consisting of government appointees, elected officials, tourism promoters and hotel industry representatives to determine the project's practicality. The councilman wants to know whether a convention center hotel really is needed, what effect it might have on courting conventions and what role taxpayers might have to play to get it built.
"Clearly, the convention and visitors bureau has come to the decision that the next step for the Salt Palace is a hotel," Hatch said. "I don't know if the rest of the world has come to that conclusion."
Hatch hopes to have a preliminary report by late summer.
The proposal already has proven worrisome for Councilwoman Jani Iwamoto, who fought vigorously as a community activist to keep a previous Salt Palace expansion from destroying the remnants of Japantown. A convention center hotel, she fears, could land a heavy blow on that historic community, still home to the Salt Lake Buddhist Temple and Japanese Church of Christ.
And it troubles Councilman Jeff Allen, who wonders whether government should meddle in the private affairs of the hospitality industry.
"I just don't see that it is necessary or appropriate for government to be involved in that," he said.
But tourism backers insist a convention hotel could lift the region's economy. Without it, hundreds of high-dollar conventions could continue to bypass the Beehive State.
The Salt Lake Convention & Visitors Bureau reports that Utah has lost conventions capable of producing nearly 600,000 overnight stays since 2005 because of its lack of a major hotel near the Salt Palace. That's more than a year's worth of convention traffic for Salt Lake County, which logged 460,000 meeting-related stays last year.
The notion of a convention hotel resonates with Steve Lindburg, general manager of Hilton Salt Lake City Center and marketing chairman for the Utah Office of Tourism Board, who believes the project, done right, could elevate the hospitality industry.
"Long-term, if this allows Salt Lake to attract larger national conventions, then it makes all the sense in the world," he said.