By Maria Saporta and Eric Jackson
As published in the Atlanta Business Chronicle on June 21, 2019
Still warm from the glow of hosting a successful Super Bowl LIII, Atlanta regional leaders have drafted a wish list of mega sporting events they would like to host over the next dozen years.
It includes another Super Bowl, perhaps in 2029, as well as the FIFA World Cup in 2026; the NCAA (Men’s) Wrestling Championship and the ACC Men’s Basketball Tournament in 2023; the NBA All-Star Game in 2024; the College Football Playoff National Championship in both 2025 and 2032; the NCAA Final Four match up in 2027 and Wrestlemania in 2028.
Atlanta already has secured the NCAA Final Four for 2020 and Major League Baseball’s All-Star Game in 2021.
“States around the country understand that these events offer a great platform to show off a city and state while providing a real economic boost,” said Dan Corso, president of the Atlanta Sports Council. “It’s priceless marketing that’s worth far more than what we could ever afford to pay.”
But these events come at a cost.
“Costs for security and public safety continue to be significant cost-drivers for hosting these major sporting events,” Corso said. “The model currently in place has worked well for us for a number of years, but based on how other states and cities we are competing against are tackling funding for these major events, it’s time we do the same.”
Atlanta and Georgia officials are proposing to sweeten the war chest needed to attract and host major sporting events – through new and expanded public funding sources.
Earlier this year, Georgia Rep. Ron Stephens (R-Savannah), who chairs the House Economic Development and Tourism Committee, introduced a pair of bills to support the cause.
House Bill 740 would create a tax-increment funding mechanism allowing the state to allocate money based on the economic impact the event could generate to help pay for some of the costs typically incurred by a host committee.
“The economic impact generated from the event would lead to additional tax revenues that the state would recoup as a result of the event,” said Marshall Guest, vice president of business climate for the Metro Atlanta Chamber. “This approach is similar to the model Texas has in place.”
According to HB 740, the General Assembly believed this funding model was the best feasible solution to bring more big sporting events to Georgia with the hopes of increasing employment and driving economic impact.
“The Texas model can assist Texas communities with paying costs related to preparing for or conducting an event by depositing projected gains in various local and state taxes generated from the event in a dedicated event-specific trust fund to cover allowable expenses,” Guest added.
The second bill – HB 730 – would extend legislation passed in 2016, when the state exempted the sales tax on tickets to major sporting events. That legislation was instrumental in helping Atlanta secure Super Bowl LIII, but that sales tax exemption is scheduled to sunset in 2022.
HB 730 would renew the sales tax exemption and extend it to other tangible items that host committees typically purchase like uniforms for volunteers.
The Metro Atlanta Chamber conducted a thorough review of states across the country to better understand the financing options used to host major sporting events. It reviewed programs in Texas, New York, Florida, California, Louisiana and Minnesota among others.
“This review found that Texas and Louisiana, states that we often compete with to host major sporting events, have both taken a more aggressive approach to financing these events,” Guest said.
Passing both HB 740 and HB 730 would help Georgia’s ability to compete and host the major sporting events. The bills are expected to be voted on during the first quarter of 2020.
Doug Hertz, president and CEO of United Distributing, led the $20 million corporate fundraising effort to help host the most recent Super Bowl. It included contributions from Atlanta’s top companies – many of which couldn’t take advantage of marketing opportunities because their direct competitors were official NFL sponsors. Those included The Coca-Cola Co. (PepsiCo Inc. is an NFL sponsor) and United Parcel Service Inc. (FedEx Corp. also is an NFL sponsor).
Going forward, Hertz said, it would be difficult to go back to Atlanta’s corporate community for similar funding.
“I don’t think there’s much appetite from the corporate community to fund those events,” Hertz said. “These events are getting more expensive to put on. We need to have public funding like our competitors in Texas and Florida.”
Hertz said he views these events as economic development that helps big and small businesses alike – from restaurants, hotels, ride-sharing services and souvenir vendors.
“There needs to be some sort of mechanism that can help,” Hertz said. “I don’t think we can continue to go to the corporate sector to ask for that kind of money. There’s a limit to it.”
Corso said Atlanta is well-positioned to go after the big events, especially after successfully hosting the Super Bowl this past February.
“Atlanta has proven itself a desirable place to host these major sporting events because of the compact downtown hosting campus we have, the number of hotel rooms, the accessibility that MARTA affords, as well as the connectivity of Hartsfield-Jackson” Atlanta International Airport, Corso said. “Most importantly, Mercedes-Benz Stadium, SunTrust Park and State Farm Arena are all first-rate venues to host these types of events.”
Corso said Atlanta has been fortunate to have had strong support from the corporate community, local partners – such as the city of Atlanta and the Atlanta Convention & Visitors Bureau – as well as the state of Georgia.
“We are confident that this winning combination will carry us into the future as we compete to host the next round of major sporting events,” Corso said. “To position the state and Atlanta where we can continue down this winning path, we must keep making strategic decisions that keep us in the hunt, and we must also build on the strong partnership between the state, local partners and business community support.”
Hertz summed it up this way.“We want to be competitive,” he said. “We want to host these events for our citizens and our businesses as well. We want to be in the game.”