‹ The Texas Major Events Reimubursement Fund paid the Dallas Sports Commission $4.6 million after WrestleMania 38 at AT&T Stadium last year. USA TODAY NETWORK
Twenty-one states have a fund or grant to help destination marketing organizations attract and/or operate sporting events, according to data provided to Sports Business Journal by Stoll Strategies. That number is sure to grow as more states ponder ways to drive tourism-related revenue.
“Not only are you behind the curve if your state does not already have an event funding mechanism, but indicators point to a wave of additional funds coming down the line,” said Jennifer Stoll, author of the Stoll Report on State Event Funds.
An analysis of the report and state documents show that there is no one-size-fits-all approach to the event funds.
North Carolina’s recently approved Major Events, Games, and Attractions Fund, for example, goes into effect in January and joins Pennsylvania as the only funds fueled entirely by sports bettors. The N.C. Department of Revenue will collect an 18% tax on gross wagering revenues of sports betting (which also takes effect in January) and 1% of the total wagers placed on horse racing. After $4.3 million is taken off the top for other initiatives, 30% of that collection will be earmarked for the new fund “to encourage and promote the attraction of major events,” according to the state’s sports betting law. The state estimates that $16.2 million will be collected for the fund by fiscal year 2027-28.
North Carolina is one of several states whose efforts are aimed specifically at luring major events. Although most of those states do not define the term, a handful identify World Cups, Super Bowls, Olympic Games, NCAA basketball Final Fours and other events that typically provide a market with significant national and/or international exposure.
On the other end of the spectrum, some funds can only be used to solicit amateur sports and others can also be used for nonsporting events, such as political conventions.
Some states are simultaneously providing money to lure big events to their large cities while hoping to recruit other events to the smaller markets. Indiana’s $5 million bid fund, for example, requires that at least 30% of the events take place outside Marion County, where Indianapolis is located. Similarly, Minnesota Sports and Events, a nonprofit charged with bidding for major events, has asked lawmakers to create a one-time $50 million fund to assist with the efforts. MNSE is described in legislative documents as “a regional entity primarily representing Minneapolis, St. Paul and Bloomington, and secondarily Minnesota.”
Many sports commissions’ financial models are heavily dependent on corporate fundraising and/or a small percentage of ticket revenue, which one executive said has become “unsustainable as event organizers demand guaranteed funding.”
That is one of the reasons that the California Travel Association last month announced the formation of a coalition of more than 100 tourism-reliant organizations to help encourage the state’s elected officials to establish a dedicated event fund to help bid on, support and retain sporting, cultural and business-related events in California. The majority of the alliance consists of sports commissions, venues, teams, leagues and governing bodies.
“As we continue to craft and mold what a final product of a dedicated events fund would look like, the goal is to get the endorsement of the California State Assembly Committee on Arts, Entertainment, Sports, & Tourism, then work strategically with their members to craft a framework,” said Anthony Brenneman, senior director of the Orange County Sports Commission and co-chair of the California Sports Coalition.
Kentucky, Louisiana and Virginia received federal funds from the American Rescue Plan Act to provide to municipalities to help counter the negative financial effects of the pandemic.
Event organizers who request state funds furnish estimated economic impact data, based on each event’s past performance, to receive the funds. Final disbursements come after forms are filed with verifiable data from the event.
For example, the Dallas Sports Commission last year received $4.6 million from Texas’ fund after hosting WWE WrestleMania 38 and providing Ticketmaster and SeatGeek ticket sales data. The data showed that 49% of 188,000 fans that attended the two-day event came from out of state and 19% were from Texas, but outside the Dallas market, which topped original projections.
Of the nearly $500 million reimbursed by Texas since 2015, Frisco has received roughly $8.2 million for 63 events. The town has had a busy year and there is an estimated $3.7 million for recent events that has been applied for but not yet disbursed, including an estimated $710,000 for last January’s FCS title game played at the Toyota Stadium, home for the game since 2010.
While many states insist that the funds be used for single-event requests for proposal, some can be multiple years. Pasco County, Florida, for example, will host the Florida Senior Games, presented by Humana, next week. The 10-day multisport event will attract 2,000 athletes from 36 states. The county was granted a total of $119,795 after winning the bid to host the 2022, 2023 and 2024 games.
Stoll said that the trend is moving beyond the U.S., as she just completed an assessment of the Canadian market for Sport Tourism Canada.
