Hard to measure the true value of events | VailDaily.com

Hard to measure the true value of events

Lauren Glendenning

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Many first-year events need seed money before the events can stand on their own, however in many cases, that seed money turns into annual funding.

The Vail Valley Foundation, which produces events like the Birds of Prey World Cup, the GoPro Mountain Games, the Vail International Dance Festival and the upcoming 2015 World Alpine Ski Championships, tries to be as self sufficient as possible, Folz said. The town of Vail has always been a great partner, but it’s a tricky balance.

“We try to depend as little as possible on government support because we like the idea that if an event is viable, it’s viable, and if not we don’t want it to be supported through taxpayer dollars, either, because then we feel like we’ve kind of missed the boat if we’re trying to bring more tax money in but we’re using tax money to pay for it,” Folz said. “It goes back to what’s that balance? There’s always going to be some support you need but it shouldn’t be a big percentage of what the event’s going to cost.”

When towns are in the business of supporting events, they also face criticism when the benefits aren’t evenly spread throughout the community. The example of Lionshead Village in Vail, for example, has left the town’s Commission on Special Events actively seeking an event for that village in order to make all business owners happy.

It’s impossible to please everyone, though, said Aspen City Manager Steve Barwick.

“All special events have impacts both pro and con on different portions of the community,” Barwick said. “The X Games is a real economic boom for certain businesses and actually hurts some businesses; the same with the USA Pro Cycling Challenge. Any special event, the impact from the event itself is unequal on neighborhoods and businesses, however collectively, over the year, it adds a lot to the town’s vitality.”

During the recession, the Aspen City Council asked the community for economic development ideas. The program was called Mining for Ideas.

A lot of the responses were event-based, Barwick said, and the city did help with seed money in many cases, he said.

“Everybody would like to get out of the funding business, but unfortunately some (events) need it ongoing,” Barwick said.

The town of Vail has looked at its ongoing funding for annual events and determined there are iconic events that have huge economic benefits to the town, therefore there’s enough return on investment to justify annual funding. Events that receive town funds have to provide detailed economic impact reports for the town, however, and the details in the reports over the years have proved to town officials that the town’s involvement in special events has generated big returns.

The Vail Valley Foundation has to produce multiple reports for the town annually, and Folz said everything that factors into economic impact is included.

“You can’t just look at revenue and expense,” Folz said.

Breckenridge and Aspen do not study the impacts of events at the level Vail does. Aspen Chamber Resort President and CEO Debbie Braun said reports aren’t available, and Breckenridge Resort Chamber Events Director Sandy Metzger said the chamber is working on such reports for future events.

Like Vail, Aspen does fund some of its more iconic events that benefit the overall community year after year. The city has given the X Games $100,000 per year on average, and gave $125,000 in 2013. Barwick said events like that have obvious returns for the city.

“When you look at something as large as the X Games or the (USA) Pro Cycling Challenge, we’re looking at international media coverage and that’s the primary reason,” Barwick said. “All special events have impacts, both pros and cons, on different portions of the community.”

Aspen Skiing Company Vice President of Sales and Events John Rigney said the company has “a host of criteria as to why we’d host an event, from soliciting destination business to enhancing guest experiences for people while they’re in town.”

Rigney said it’s rare for the sole or main objective of an event to be to drive destination business, though.

“There are a lot of reasons we do events. … World Cup is at the beginning of the year; it’s a great opportunity for us to get a snow message out,” he said. “The X Games — the TV exposure alone puts you on a greater number of people’s radars that haven’t been here.”

Research needed for success

In Aspen, which has enjoyed summer success for decades, iconic events fill up the calendar both on and off the mountain. Jazz Aspen Snowmass, over Labor Day weekend, is celebrating its 23rd season this year, while the Food & Wine Classic just turned 31 and the Aspen Music Festival and School has been around since 1951.

Head northeast to Vail, and summer events like the Go Pro Mountain Games, formerly the Teva Mountain Games, just turned 12, the Bravo! Vail Valley Music Festival celebrated 26 years this summer and the Vail International Dance Festival turned 25.

In Breckenridge, the town’s Oktoberfest celebration claims to be the largest of its kind in the state and is celebrating 19 years next month.

The target markets vary from community to community, and event to event.

Breckenridge has sought more “moderate ticket” events, where as Vail and Aspen aim for high-ticket.

“Our character is a little different than those other brands,” McMahon said. “Not to say there won’t be something down the road, but our atmosphere is a little more down to home and smaller scale, almost by design. Our largest facility here holds 1,300 people.”

While Vail seems to have the “build it and they will come mentality,” McMahon said Breckenridge is much more protective of its historic district and heritage.

Instead of focusing on large-scale events, Breckenridge has gone down the guest experience path. That, McMahon said, is what community leaders feel will give them more bang for their buck.

Vail, on the other hand, claims a lot of bang for every buck it spends on events. In 2012, Vail reported that the payback ratio to the town in sales taxes was $2.37 for every dollar spent on event funding. The town reported the overall community economic impact to be $76.77 per dollar spent on event funding.

McMahon isn’t sure the return on investment is so high with special events — “there’s no way (Vail’s) getting return on investment” — but he acknowledges the benefit in brand presence through events.

Vail Resorts noticed that benefit, too, more than 30 years ago when it decided to start the Vail Valley Foundation. Foundation President Ceil Folz said the whole point back in 1982 was that events would help market the Vail and Beaver Creek brand.

The town of Vail measures economic impact through the estimated spending of event attendees on lodging, dining, shopping and other activities in town.

In ROI reports to the town, data includes additional incremental spending in town generated by events, the ratio of increased revenue to the amount of funding received and additional sales tax revenues.

The Vail Valley Foundation studies impacts like marketing and public relations impressions made, too. Impressions are defined as the number of people who may have seen or heard about the event on TV, in print or online. The Foundation reported 226,513,382 marketing impressions from this year’s GoPro Mountain Games, a media value of nearly $4 million, according to the Foundation’s stakeholder’s report.

Growth expected to continue

New on-mountain recreation and more events should round out the summer season

Ceil Folz remembers walking around Vail Village in June of 1982 and seeing nothing but empty streets. She chuckles at the memory — things have changed a lot since then.

“There wasn’t a soul around,” she said. “This community for sure, and most (communities), have said ‘nope — to be viable, to have people who can raise their kids here and have a paycheck, and to do all those things you need to support a community, we need to have a better balance between summer and winter.”

She thinks Vail has done it. She is personally busier in the summer months than during winter, but a lot of that is admittedly due to planning for the 2015 World Alpine Ski Championships.

There’s a reality, though, that summer will never be winter. In Vail, 70 percent of the town’s annual revenue comes from winter, Vail Town Manager Stan Zemler said. In lodging tax revenues alone, the split is 80-20.

“That hasn’t changed in terms of winter-summer, but volume is up for both seasons,” he said.

Growth during spring, summer and fall is outpacing winter growth, though, said Vail Valley Partnership President Chris Romer.

There’s little doubt of the benefits that year-round resort destinations have on mountain resort economies, but is there a point when the growth becomes too much?

“I don’t know we’ve hit that tipping point yet,” Folz said. “I think there’s a few more things we can plug in and bring to life.”

Folz laughs at Telluride’s Nothing Festival, an event “accidentally created by a local resident who was fed up with the number of festivals in general and the prospect of another huge event by a large promoter,” according to the festival’s website. Events include sunrises and sunsets. And “gravity will continue to be in effect.”

The quantity of events hasn’t reached such tongue-in-cheek levels yet in Vail, Aspen or Breckenridge, but new legislation passed by Congress could lead to busier summers than ever seen before. The Ski Areas Recreational Opportunity Enhancement Act of 2011 means ski resorts can build more summer recreation infrastructure on their mountains.

Vail Mountain celebrated the opening of some of its first projects earlier this month. Vail Mountain Chief Operating Officer Chris Jarnot touted the economic benefits at a sneak preview of the mountain’s new 1,200-foot zipline and ropes challenge courses.

“The employment piece of this is particularly exciting for us,” Jarnot said. “Beyond the economic benefits, the opportunity for us to employ our best and brightest winter employees on a year-round basis and keep them engaged with us rather than have to send them off to find other summer work, and then hope to be able to attract them back every fall, is a great opportunity for our company to be able to develop people and keep them engaged and growing here in our communities.”

Sen. Mark Udall sponsored the bill and attended the opening at Vail Mountain to talk to the media about those economic benefits that should benefit all of Colorado.

“This is the beginning of an enormous opportunity across the ski industry and Vail has led the way,” Udall said. “It’s long been said that we all come to Colorado for the skiing, but we stay for the summers. … The mountains don’t take the summer off, neither should our ski resort industry.”

Copper Mountain has installed a summer zip line, too, that operates year-round. Resort spokeswoman Stephanie Sweeney said summer at Copper Mountain has become “nearly as active” as the winter season with increased summer activities and summer events such as Copper Triangle, Warrior Dash and Wanderlust.

While the U.S. Forest Service still works out some of the regulations at the federal level, local forest officials are working hard already on the projects underway. Eagle/Holy Cross District Ranger Dave Neely, of the White River National Forest, is looking at Vail Mountain’s educational component to summer activities as especially exciting.

“If (visitors) leave with just a small understanding (of our natural resources), we think it’s fantastic,” Neely said.

At a real estate and tourism symposium in Aspen earlier this month, Aspen Skiing Company CEO Mike Kaplan said Aspen needs a stronger summer presence through more recreational activities like mountain biking, which the company has expanded trails already at Snowmass.

The company’s Vice President of Sales and Events John Rigney said summer business is a focus and the company wants to see continued progression and increased visitation. While Vail Resorts hit the ground running with its summer activities proposals for Breckenridge and Vail Mountain, Aspen Skiing Company hasn’t submitted a proposal since the 2011 legislation passed.

“We’re certainly taking notice of what others are doing, especially when trying something new,” Rigney said. “We’re trying to figure out what fits well here and how do we differentiate ourselves from our competition.”

In Breckenridge, the town expects some growth as the ski area builds more summer activities. There’s no real prediction of how much will be new business versus folks already coming through the county, said Breckenridge Town Manger Tim Gagen.

“Most of the towns infrastructure is already built to handle peak winter crowds so the growth in summer is not expected to exceed what we already handle,” he said.

The lessons learned will come from the communities these resorts serve, with the growth at Vail and Breckenridge expected to teach best practices to other communities early on. Vail Town Manager Stan Zemler said it’s hard to know what the impacts will be once Vail Mountain’s summer activities are fully built. On a mid-week day earlier this month, when the parking structures and hotels were far from full, he could see plenty of room for growth without any worry of the town busting at its seams.

“It might bring a few more people, but it will also give the people who are here more things to do,” Zemler said. “I don’t think it’ll be something that breaks our back.”

Lauren Glendenning is the editorial projects manager for Colorado Mountain News Media. She can be reached at lglendenning@cmnm.org or 970-777-3125.

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