State lawmakers question $5M Pro Bowl subsidy
By Sean Hao
Advertiser Staff Writer
When the Pro Bowl hits television sets across the country today, the question uppermost on the minds of some key state decision-makers won't be who will win, AFC or NFC. More important is whether the state will get back its $5 million investment in a sports event that hit a record low household viewership of 4.5 million last year.
Bruce Asato The Honolulu Advertiser
Indianapolis Colts quarterback Peyton Manning met with throngs of fans on Tuesday urging him to sign his autograph on photos, magazines, helmets, footballs and jerseys.
Bruce Asato The Honolulu Advertiser
But unlike the marathon, the Pro Bowl remains subsidized. Whether that money nearly 9 percent of the state's $56 million tourism budget is well-spent continues to be a matter of debate, particularly given the state's precarious financial health.
"I support the Pro Bowl," said Sen. Sam Slom, R-Dist. 8 (Kahala, Hawai'i Kai). "I'm a longtime critic of the state subsidizing the Pro Bowl. I liked it better when we got it for free."
The Pro Bowl has been held at Aloha Stadium for the past 24 years. But in the past it has been difficult to gauge how much the state gets for its money. Now, based on a survey of visitors taken during last year's events, state officials figure the annual game brings in about 16,000 people from the Mainland.
Each visitor stays an estimated 10 days in Hawai'i spending an average of $154 a day, totaling $25 million for goods and services such as food, hotels, transportation and crafts, according to the state Department of Business, Economic Development and Tourism. The visits translate into $2.42 million in additional revenues for the state.
Intangible benefits include an estimated 11 hours of nationwide exposure for the state and coverage from 20 Mainland media outlets. The value of those images is high, but difficult to quantify, said Darrel Kloninger, president of Waikiki advertising firm AdWorks Inc.
"The cameras pan the crowd and show everyone in aloha shirts to those 4.5 million houses where people are stuck in the middle of winter," he said. "It's a positive motivator.
"The benefits of the event far outweigh the subsidy."
However, critics question whether the state overpays to host the event, particularly with its ratings waning in recent years. Last year the game competed against the first day of the Winter Olympics. The Pro Bowl's 4.5 million viewership was down from 9 million households in 2000 and 5 million homes in 2001.
Meanwhile, the amount paid by the Hawai'i Tourism Authority for the event increases each year, topping at $5.8 million when the current contract expires in 2005. State officials hope to restructure the deal to reduce the taxpayers' contributions to the event in 2004 and 2005.
In an effort to extract the most money and exposure possible from the all-star game activities, the location and number of Pro Bowl events has increased in recent years. This includes holding activities at Fort DeRussy, instead of the stadium, more player appearances, resurrection of a charity golf event and plans for a cooking contest next year.
"We're trying to make the Pro Bowl more than just a one-day event. That way we can extend the economic impact," said Frank Haas, vice president of marketing for the Hawaii Tourism Authority.
Rather than give money to the NFL, Slom said the state needs to focus on the repair of Aloha Stadium. In addition to new turf, scheduled for installation by May 23, the stadium requires parking upgrades and repairs to certain concourse areas.
"If you don't do those things, then the $5 million won't make any difference," Slom said. "This is an event for the players and the players determine a lot of what happens at the Pro Bowl.
"Time and again, the players have complained about the conditions at the stadium."
What the NFL gets in return for playing the game in the state, apart from $5 million, is a unique event with high-player participation given Hawa'i's attraction, said Jim Steeg, NFL senior vice president for special events.
The $5 million paid to the NFL only partially offsets the $8 million to $10 million expense of holding the Pro Bowl and related events. Most of the money is spent in Hawai'i, Steeg said.
"We tend to buy everything we need here because we felt the need to use, support and buy (in) Hawai'i," he said.
The trickle-down effect of the Pro Bowl's presence here is difficult to quantify. Numerous hotels benefit, including the Ko Olina Resort, where the players stay, and the Hilton Hawaiian Village, where the NFL lands while in town.
Local businesses also benefit. Ticket Plus, based in downtown Honolulu, sells Pro Bowl and related event tickets. Chief executive Manny Sanchez said the relationship boosts the company's sales and visibility.
"We get exposure to companies all over the world that would never have heard of Ticket Plus otherwise," he said. "It carries us for the first quarter."
Other businesses reaping rewards from the game include Roberts Hawaii Inc., the state's largest ground transportation company. It dedicates between 20 and 30 buses to the transportation needs of Pro Bowl players, families and VIPs, during the week, said Roberts spokeswoman Sam Shenkus.
Roberts would not discuss the value of its agreement with the Pro Bowl, but said the event "is a big deal."
But "in terms of the number of people, the (Honolulu) marathon is bigger," Shenkus said.
The marathon receives no state subsidy, but infuses $62.2 million into the community, according to DBEDT. However, marathon organizers think state money would increase its draw, particularly among Japanese visitors who comprise a majority of the marathon's participants. Marathon coverage highlights more of Hawai'i's scenery, making a more effective draw than the Pro Bowl, said marathon spokesman Pat Bigold.
"Unlike the Pro Bowl, all shots of the Honolulu Marathon that are broadcast throughout the world depict the state's environment, its people and its neighborhoods," he said. "TV images of football games and golf tournaments cannot present as much of the real Hawai'i."
Haas said the Hawai'i Tourism Authority weighs two main factors when deciding event financing: exposure and attendance. The Pro Bowl gets a subsidy largely because of the added attention it brings the state, he said.
The marathon doesn't need a subsidy because it already successfully attracts visitors. Still, Haas said: "We're talking about the marathon and possibly helping them with marketing costs, especially with respect to the Japanese market."
Reach Sean Hao at email@example.com or 525-8093.