Glendale City Budget and Arizona Sports and Tourism Authority
By Jack Briggs
If you haven’t read the City of Glendale budget for 2012-2013 yet, you are missing out. Who needs 50 Shades of Grey when you have this literary masterpiece right at your fingertips? I would point you to the Full Year 2013 Draft Operating Budget Summary of Remaining Budget – All Funds. Financial Services (section 2, page 14). The City of Glendale has budgeted 20 million dollars from Arena Event Operations, $550,000 as Arena Special Operations, and 1,746,000 dollars in Stadium City Sales Tax. This totals over 22 million dollars in revenue to the CoG from events at University of Phoenix stadium thanks to the Arizona Sports and Tourism Authority. In 2011, Glendale received 5 million more (25 total) for Arena Event Operations but expects 300,000 more in Stadium City sales tax recovery in 2012.
Created when voters in November 2000 approved proposition 302, the AZS-TA and the funding mechanism required to generate revenue was established for six purposes.
- Build a world class multi-purpose stadium in Glendale
- Promote tourism in Maricopa County
- Contribute to Cactus league baseball, including construction of Camelback Ranch in Glendale for the Chicago White Sox and LA Dodgers
- Youth and Amateur Sports (YAS) grants
- Operations at University of Phoenix Stadium
- Reserves for YAS, Operations, Capital, and Repair
A hotel bed tax and rental car tax in Maricopa County were established to start the flow of money. To finance the construction of Cardinals Stadium (now University of Phoenix stadium), the AZ-STA provided 302.3 million dollars, the Arizona Cardinals contributed 143.2 million, and the City of Glendale provided 9.5 million.
Going back to the City of Glendale budget, how is that 22 million dollars generated? Cardinal home games (8 regular and 2 preseason), and the events at University of Phoenix Stadium like the Fiesta Bowl or BCS National Championship game are the largest source of revenue. They you have events like the RV show, Ribfest, Maricopa County Spring Fest, and other events at the stadium or parking lot like Cirque de Soleil.
Where does the majority of the money flowing into the AZ-STA come from? The NFL schedule comes out, and fans look to see who is coming. The Arizona Department of Revenue swings into action as well. The day of an NFL game is like Christmas for the ADofR. When a player from an opposing team comes to town for a game, they get taxed as they are working in Arizona for that day. And the taxman wants their share. The NFL income tax in February 2012 generated 0.5 million dollars. Concession revenue and facility use fees were budgeted at $200,000. Now, since the Cardinals did not play in February as they did not make the playoffs, the concession revenue is low.
In 2011, AZ-STA paid out the following:
- bonds (stadium financing) 9.7 million dollars
- tourism 5.6 million
- Cactus league received 4.8 million, and
- Youth and Amateur Sports received 1.1 million.
The AZ-STA depends upon the Cardinals and college football mega-events like the Fiesta Bowl and BCS. With the BCS being scrapped in favor of a playoff system, the Fiesta Bowl scandal in 2011, and the Cardinals looking like the Cardinals before Kurt Warner arrived, expect there to be a budget shortfall at AZ-STA. Meaning, they will be lowering their payouts to Glendale, YAS, and the Cactus League.
Glendale is going to receive 5 million less from the University of Phoenix (arena special events). Half of the costs of Camelback Ranch baseball stadium were to be paid by the construction of a resort with a retail area. The resort and retail have not been constructed, leaving the entire cost construction to be paid by City of Glendale. The Dodgers and White Sox are incredibly profitable. They could contribute to the cost, but the facility was built without that agreement.
Glendale has a revenue problem. They need to get out from under the cost of Jobing.com. They will be paying not only on Jobing.com but also Westgate. Mr. Jamison is provided that opportunity. Money will be coming into Glendale if the Coyotes play a full season at Jobing.com. There will be no money back if the team leaves. You think Glendale has a budget problem now, wait until there is no team.