The San Diego Unified Port District has given conditional approval to help fund the $550 million cost for the proposed San Diego Convention Center expansion. Based on action taken by the Board of Port Commissioners at a special meeting on Nov. 29, it may contribute up to $3 million a year for up to 20 years. The commissioners directed staff members to begin negotiations with the city on the terms and conditions of support agreements. The staff also was directed to “develop alternatives to address balancing the needs and benefits” in the Port District’s five member cities of San Diego, National City, Chula Vista, Coronado and Imperial Beach. Details on when the port will begin making financial contributions will be worked out in future negotiations between the port and city. “There is a lot of work left to do,” said Scott Peters, chairman of the Board of Port Commissioners. “We do some things to make money and we do some things for the community. This should provide a return on investment to the port.” The action is in response to a request that Mayor Jerry Sanders made before the Port District’s board on Nov. 8, when he suggested the contribution of $3 million a year, or $60 million over a 20-year period. “The Port District will share in the $698 million in economic benefit to the region,” Sanders said. The port’s staff had analyzed the revenue expected to be generated from the proposed expansion and a proposed 500-room expansion of the Hilton San Diego Bayfront Hotel. It was concluded that the positive economic impact to the region was reason enough to support the development of 500 new hotel rooms to support the expanded Convention Center and that it would be a good investment. Studies by consultants indicate the Port District could derive revenues ranging from a low of $3.5 million a year to a high of $6.2 million a year, depending on whether the Convention Center expansion and the Hilton addition are developed at the same time. Port District officials also said several potential issues may need to be addressed to ensure that any commitment does not compromise its ability to implement other important regional projects in its five member cities. The issues include the return on investment, the timing of payments, the city’s contribution and the impact on the Port District’s credit. Aside from the district’s proposed contribution, the city suggests funding sources for the expansion that include $33 million a year in tax revenues from a proposed Convention Center Facilities District. The facilities district would levy taxes on hotels in the city and produce revenue that would cover up to 75 percent of the expansion cost, according to the city. The expansion project is currently in the environmental review phase. The environmental impact report is scheduled for completion in February. Construction is anticipated to begin one year later. The city expects the expanded Convention Center to be completed in early 2016. The Mayor’s Citizen Task Force projects the expansion is expected to generate $698 million of economic activity annually in addition to the $1.3 billion a year the Convention Center already generates.