Mentoring Article - November 2009

State Funding Initiatives

As the economy continues to be less than desired, we are all forced to look for creative ways to fund our events.  Traditional sponsorships are not helpful because clients or potential sponsors that we would like to have are also being affected directly or indirectly by the economy.  One place most convention and visitors bureaus and sports commissions turn to is state or city government for funding allocations.  In many cases, sports commissions are granted money through either entity based on room night taxes, other assigned tax-based revenue streams, or general fund dollars based on economic return/evaluation, but these are not the only sources available.  Sports commissions, state, and city governments have had to get creative in many cases to find new identified sources to elevate or support their local sports commission’s activities as they cannot solely survive on room tax or general fund dollars alone, especially in communities where a separate CVB and sports commission are both vying for the same dollars.  

Here are a few examples of potential funding sources:  
1. State Tourism Grant programs: In most cases they are a matching fund program or based on economic impact/ROI.
2. Creative lottery opportunities
3. Ticket or Amusement Tax and/or Assessment
4. Partnering with other government based agencies (use their money to support events, while giving them maximum exposure…initiative based promotion) Example: Get Healthy Kentucky Bluegrass State Games.  Kentucky’s Health based initiative titled sponsored the state games for access to participants and exposure opportunities for their programs.
5. Room Rebate
6. Partnership/Membership Programs
7. Create/Own and Operate Events
8. Tourism Incentive Districts
9.  Federal Stimulus Money
10. Direct Event Revenue/Profit

The Maryland Office of Sports Marketing looks at all the above in one form or another to reach a strategic funding model for the future.
As Kindra Fry shares, in Texas the State Legislature has passed a Special Events Fund for which municipalities, Convention and Visitors Bureaus and Sports Commissions/Foundations apply when National or International events are taking place.   They recognize that it is a major financial burden for Texas communities to host these events, but they would like to keep the events coming to the State of Texas.  With that, the Special Events Fund was created.  This fund is based on the sales tax revenues that will be generated by the event when it is hosted in the state.  For an event to be eligible to receive funds, it must be an international or national event that is awarded by a bid process.  The funds are applied for by sending a proposed budget and estimated economic impact study to the Comptroller’s office.  The Comptroller’s Office reviews the application and makes a determination if funds will be allocated for the event.  If so, the information is passed to the Office of the Governor for his approval.      

The Special Events Fund monies can be used on the following expenses: providing security specifically for the event, providing public transportation and traffic management services for the event, providing or renting public facilities and utilities associated with the use of the facilities during the event, preparing or maintaining a contract associated with conducting the event, providing maintenance and janitorial services in preparation for, during or on completion of the event, developing or providing a special promotion, incentive or award for or associated with the event and many others.  

To receive the funds following the event, the city must make a percentage investment (about 13%) of the total request.  Following the event all receipts are collected and submitted to the Office of the Comptroller’s and funds are disbursed up to the amount that was allotted at the time of application.

And, yet another opportunity for creative funding comes from the Commonwealth of Kentucky as Greg Fante from Greater Louisville Sports Commission adds.  What state funding exists for sporting events in Kentucky? We have a sports specific agency at the state level called the Kentucky Sports Authority. The Sports Authority, is an agency of the Kentucky Tourism, Arts & Heritage Cabinet, which  was created in 2005 to actively pursue any and all athletic events with the goal of bringing them to the Commonwealth resulting in jobs, tourism and economic development. The Kentucky Sports Authority is also responsible for the state's sports marketing initiatives, leading "TEAM Kentucky," a coordinated effort of Kentucky's communities, and the state as a whole, to build the Commonwealth's image in the sports industry. Louisville is an active member of TEAM Kentucky. We believe working together we can not only attract more sports related business to Kentucky but more to Louisville specifically.

As it relates to state funding the Kentucky Sports Authority oversees a state grant program for single events. Each event is evaluated on several factors of which economic impact is the most important. This program is designed for all TEAM Kentucky members to tap into. Through these state funds we are able to bring more events to our individual destinations. There is a simple application form that the specific destination and event rights holder is responsible to complete. It relates to the specific event details for which you are applying. These funds are to help support the event in its early years of 1-3 but no longer than year three.  Each event is eligible for up to $25,000.00 but must show its value. Multiple criteria including but not limited to economic impact, media, improved facilities, and overall value to the Commonwealth of Kentucky are considered by the Authority before awarding.  

As you can see, there are boundless opportunities for creative funding for events.  In some or most cases it takes a creative approach and combination of these funding mechanisms to make a sports commission funding viable for long-term success.  For each state the funding possibilities are different.  In these economic times we would suggest that you contact your State Government regarding possible funding opportunities whether it be Special Funds, grants or other forms of reimbursement.  

About the Guest Contributors:
Greg Fante, Director of Sports Development, Greater Louisville Sports Commission.  Greg has been a member of NASC since 2001. He is a twenty four year veteran in the Louisville hospitality and sports tourism scene.

Kindra Fry, Director of Sports, Bryan-College Station Convention & Visitors Bureau.  Kindra has been with the Bryan-College Station CVB since 2004.  The sports market in Bryan-College Station is thriving and in her time in Aggieland, Kindra has increased hotel room nights by 300%.

Terry Hasseltine, Director, Maryland Office of Sports Marketing. Terry is currently serving on the NASC Board of Directors.  He spent seven years on the NGB\Rights Holder side of the industry before crossing over to the active member side of the industry in 2004.

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