Scottsdale City Council dissects Final Four tourism contract at public hearing
By Terrance Thornton | Digital Free Press
Scottsdale City Council has punched its ticket to the 2024 NCAA Men’s Final Four Tournament.
While the two-day event is held in Glendale, city officials contend — and elected leaders agree — the economic benefit of the college sports spectacle is felt from corner to corner of the Phoenix metropolitan area.
The 2024 NCAA Men’s Final Four Tournament is April 6 and April 8, 2024, at State Farm Stadium in Glendale.
Scottsdale City Council Tuesday, Aug. 22, unanimously approved Resolution No. 12901, putting into motion the first of two $216,000 payments to the Arizona Major Events Host Committee with 100% of funds derived from the Scottsdale Tourism Development Fund.
“The Arizona Major Event Committee is requesting $432,000 in support of the regionally hosted 2024 NCAA Men’s Final Four Tournament,” said Scottsdale Tourism Manager Steve Geiogamah at the public hearing. “On July 30, the Tourism Development Commission recommended City Council allocate up to $432,000 from the Tourism Development Funds, of which, 5% of the destination marketing allocation is retained by the city in support of the agreement.”
According to the Aug. 22 City Council staff report, the City Treasurer Division, a charter office of the municipality, has estimated fiscal year 2023-24 bed tax revenue at $31.4 million.
While the item was part of the Aug. 22 consent agenda, Scottsdale City Councilman Barry Graham asked to have the item pulled from complicit, routine approval for a brief presentation and question-and-answer period with tourism staff. Mr. Geiogamah walked Scottsdale City Council through the agreement providing data points specific to anticipated return on investment.
“You may recall in 2017 the region hosted the NCAA Final Four Tournament and back then funding was requested by the host committee from municipalities regionally as well,” he pointed out, providing City Council with examples of returns then.
According to a post event report published by the Arizona Major Event Host Committee, the city of Scottsdale’s 2017 investment of $150,000 resulted in a ‘realized value’ of $249,625 meanwhile that same year, the Steidman Research Institute at the W.P. Carey School of Business of Arizona State University published an economic impact report stating the overall impact of the Final Four event was $324.5 million across the region.
Mr. Geiogamah reported to City Council that a total of 153,000 spectators attended the 2017 Final Four games in Glendale and a staggering 24 million viewers watched the broadcast of the game that year. Furthermore, back in 2017, Scottsdale Hoteliers saw an immediate increases to occupancy, average daily rate and revenue per available room. In 2017, these were those numbers reported:
- *Hoteliers reported an 85% occupancy, which represented a 9.5% increase for the same period of time year over year;
- Average daily rate was $324.68, which represented a 43% increase year over year; and
- Revenue per available room sat at $275.99 during this time, which represented a 57.5% increase.
Scottsdale Tourism Director Karen Churchard, the administrator of the contract, in her report to City Council — and echoed by Mr. Geiogamah at the public hearing — points out the destination marketing agreement is based on Arizona Office of Tourism’s Prop. 302 guidelines that include event sponsorships as an allowable category for funding.
A key deliverable for the city of Scottsdale? The Arizona Major Events Host Committee is providing that 4,000 hotel rooms rented for the Final Four game and accompanying events will occur at Scottsdale hotel properties.
Scottsdale City Council dissects Final Four marketing, tourism contract at public hearing
Following Mr. Geiogamah’s presentation, Mayor David Ortega remarked the agreement is similar to the one brokered with the Arizona Major Events Host Committee during Super Bowl LVII, held last February.
“I like to say Scottsdale puts Arizona on the map and this basketball participation is as a host city then, right?” he asked with Mr. Geiogamah replying in the affirmative.
While freshman City Councilman Barry Graham ultimately voted for the contract, he posed a few clarifying questions on tenets of benefit to the municipality.
Found part of the Aug. 22 City Council report are the tangible benefits of the $432,000 allocation of tourism development funds:
- Marketing inclusion: Highlighted feature within the “Travel Information” portion of the website promoting hotels, restaurants, etc.; opportunity to be included as one of the representatives on the Marketing & Communications Council; Opportunity to be included in social media giveaways and game week social media coordination & outreach to visiting fans.
- Community engagement: May provide the Fan Jam Truck, mascots, cheerleaders, etc. to select Scottsdale events {based on availability); will work with Scottsdale to communicate to all schools within Scottsdale about its unique and exciting “Read To The Final Four” opportunity for third graders; invite qualified Scottsdale businesses to apply for the Business Connect Program; opportunity to highlight Scottsdale businesses participating in the program; City of Scottsdale and Hosting Committee to work together to engage Scottsdale residents in volunteer sign-ups, opportunities, etc.
- Events & planning: Scottsdale will be included in the Familiarization (FAM) trip leading up to Final Four, and the AMEHC will work with Scottsdale to make connections to the NCAA, media, partners, etc.; working with the NCAA and various other stakeholders, AMEHC will encourage the use of Scottsdale venues and businesses as sites for Final Four events and activities; AMEHC and NCAA will host one (1) meeting or dinner for the visiting NCAA staff, vendors and partners at a Scottsdale restaurant and resort; and one (1) Invitation to all CEO Forum events for City of Scottsdale.
The Host Committee will provide the following hospitality opportunities related to the 2024 NCAA Men’s Final Four:
- Marquee Partner Luncheon: Two (2) invitations
- VIP Golf Tournament: One (1) foursome
- Media Party: Four (4) tickets
The Final Four:
Fourteen (14) PLOC VIP Tailgate tickets
Fourteen (14) Final Four game tickets
Timing: Saturday, April 6, 2024
Final Four Championship:
Fourteen (14) PLOC VIP Tailgate tickets
Fourteen (14) Championship game tickets
Timing: Monday, April 8, 2024
Aside from defined ancillary benefit like event access, marketing prowess and hotel room rental guarantees, Councilman Graham inquired about events hosted in Scottsdale.
“So, the events in Scottsdale are to be decided but our contribution is fixed?” he asked of Kyle Hedstrom who represented the Arizona Major Event Host Committee at the Aug. 22 public hearing. “Have other contributions from the other municipal partners, have their requests gone up as well?
Mr. Hedstrom, who also served on the host committee specific to the most recent Super Bowl, confirmed that each of the already established partners have seen contribution increases.
“We have been working with major events like the mayor mentioned — like the Super Bowl — with municipalities or there DMO [destination marketing organizations] and using the Prop. 302 formula for those specific requests, we do have several of those cities or CVBs signed on as partners already,” he said.
“We are working on a familiarization trip here, hotel, potential site visits … in 2017 nine events did come to the city of Scottsdale. The economic impact we have seen in other cities has grown and we expect to see some growth as well.”
According to Mr. Hedstrom, other local municipalities, or a DMO, Scottsdale is joining in the funding agreement include:
- City of Glendale
- Visit Phoenix
- City of Avondale
- City of Peoria
- City of Phoenix
“Would you say their contracts increased commensurate with Scottsdale?” Councilman Graham asked, with Mr. Hedstrom replying in the affirmative.
Councilman Graham went on to ask about the evaluations of the economic impact studies that help define return on investment.
“Just one last question Steve, if I may ask, is it’s just kind of funny a thing the entity calculating how much we need to pay and how much we benefit is the same one?” he asked. “Do you have any concerns with that?”
Mr. Geiogamah provided Councilman Graham with the typical evaluation of tourism and marketing contracts.
“Well, back in 2017 they gave us an estimated value and that is what we showed this evening,” he said. “Yes, of course, we go through a review process. We do have some consultants that we contract with to assist us in that regard but, ultimately, we enter in the deliverables and closely monitor those deliverables and we try to ensure they are received.”
