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America's River Festival Funding RequestTHE CITY OF Dui Masterpiece on the Mississippi TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: America's River Festival Funding Request DATE: January 2, 2014 Dubuque band AI- America City 11111r 2007 • 2012 • 2013 The America's River Corporation is requesting the City of Dubuque's aid in offsetting the 2013 America's River Festival shortfall of $150,000 with a $30,000 contribution from the City. Four of the other America's River Corporation Board Members have each contributed $30,000 to make up the balance of the shortfall, including the Dubuque Area Chamber of Commerce, the Dubuque Convention and Visitor's Bureau, the Dubuque Racing Association and Dubuque Initiatives. Additionally, America's River Corporation is requesting the City's America's River Corporation Partner commitment of $10,000 for America's River Festival in 2014. America's River Festival began as the Grand Excursion back in 2004. In 2005, The Grand Excursion was renamed to America's River Festival, with the event signifying and embracing the Port of Dubuque transformation. This transformation is still ongoing and has seen upwards of $400 million dollars of investment to the area in the past decade. Attendance at the America's River Festival continues to rise and the reach regionally continues to expand. America's River Festival has quickly become a signature event for the community and one that many local and regional visitors look forward to attending. The America's River Corporation, which is made up of representatives from the Dubuque Area Chamber of Commerce, the Dubuque Area Convention & Visitors Bureau, The City of Dubuque, Dubuque Racing Association, Dubuque County Historical Society, Dubuque Main Street and Dubuque Initiatives governs the America's River Festival. The board meets monthly and America's River Festival is the main focus. All board representatives have a voice in budgetary and entertainment matters. 2014 will mark the 11th year of the festival and 10th year of the festival being known as America's River Festival. In the eleven total years of existence, only two years have resulted in a budget shortfall, 2007 and 2013. A five year recap is as follows: Year 2009 2010 2011 2012 2013 Profit /Loss $28,224 $21,703 $13,964 $45,209 ($153,787) 2013 represented a different scenario than seen in years past, including a more aggressive entertainment line -up and a loss on the bottom line. Given how successful the event had become in the previous years, the board voted and gave direction to secure bigger name entertainment for 2013. With bigger entertainment came bigger entertainment fees. To help offset the higher fees, the board voted to raise ticket prices from 2012. While the VIP and reserved tickets sales flourished, the general admission sales were down compared to national averages for the caliber of entertainment. The board and Festival staff came to the conclusion that the price point for the local audience was too high compared to what was paid in the past. Going in, the board was confident in the ticket prices, especially given that Dierks Bentley performed in Dubuque in 2007 with an average ticket price of $45. For 2013, the general admission price was $40 and included entertainment from 4:30 pm -1:00 am. In 2013, people purchasing tickets were from 234 communities and 17 different states. The University of Iowa conducted a research project and concluded that the weekend of Americas' River Festival generated an economic impact of direct spending over $1 million dollars. The board agrees that a $150,000 loss was something that needed to be addressed and is not a sustainable model for the future. The board has agreed to move forward with a model similar to 2012. 2012 saw America's River Festival secure up and coming entertainment that was cheaper in price but not lacking in quality. It also offered a ticket price more attractive to the general admission crowd. Additionally, it is very important to the board that entertainment be based on sponsorship and partner dollars and not rely on walk -up ticket sales as a primary factor on the bottom line. The Dubuque area has seen a steady and influential increase in the impact that travel has had in the community. According to the Travel Iowa Impact Study for Dubuque County, the region has seen a $153.72 million increase in travel related expenditures and an increase of $14.66 million in payroll for travel related employment, since 2002. The dollars generated by the hotel /motel tax, which are utilized for marketing Dubuque as a viable destination, has also reached an all -time high for Fiscal Year 2015. While the ability to market the area as a destination for travel plays an instrumental role in Dubuque's success, the partnerships are equally as vital. It is imperative that Dubuque continue to manufacture unique experiences for the visitor that welcomes them into the community, and encourages them to visit again. These experiences allow 2 reinforcement of the tourism infrastructure that currently exists, with areas like the America's River Project in the Port of Dubuque. After funding Inclusive Dubuque for Fiscal Year 2014 and Fiscal Year 2015, the City of Dubuque has $72,352 available from Urban Development Action Grant funds that are available to fund $30,000 of this shortfall. The request for $10,000 for the 2014 Festival, which is consistent with past City commitments to the Festival, will be dealt with through the Fiscal Year 2015 budget process. I respectfully recommend Mayor and City Council approval for this $30,000 expenditure. Michael C. Van Milligen MCVM:jh Attachment cc: Barry Lindahl, City Attorney Cindy Steinhauser, Assistant City Manager Teri Goodmann, Assistant City Manager Molly Grover, President, Dubuque Area Chamber of Commerce 3 December 17, 2013 PORT OF DUBUQUE Mr. Michael C. Van Milligen City Manager City of Dubuque 50 West 13th Street Dubuque, IA 52001 Dear Mike: Please review the provided materials for the City of Dubuque's contribution for the funding shortfall for the 2013 America's River Festival. To date the following partners have paid the funding shortfall; Dubuque Area Chamber of Commerce, Dubuque Area Convention & Visitors Bureau, Dubuque Racing Association and Dubuque Initiatives. As one of our board members, you know the America's River Corporation continues to work on the development of Dubuque's signature event, the America's River Festival. In an effort to maintain and build on the success of the event, the Corporation has started planning for the 2014 America's River Festival in Dubuque to be held June 13 -14, 2014. The Dubuque Area Chamber of Commerce, Dubuque Area Convention & Visitors Bureau, Dubuque Racing Association, Dubuque Initiatives, Dubuque County Historical Society and Dubuque Main Street are all committed to the 2014 America's River Festival and as a potential backdrop. We are grateful to continue our public and private collaboration on this festival as well as the activities of America's River Corporation. We are looking forward to another outstanding year for the 2014 festival. Your past and continued support of America's River Festival is greatly appreciated. Please let me know if you have any questions. We ask you to join us in this commitment to the future success of this signature event. Sincerely, Molly Grover President America's River Festival History Overview Mike Van Milligen 1 City of Dubuque Objective: America's River Festival The America's River Corporation would like to request the City of Dubuque's aid in offsetting our 2013 shortfall of $150,000, with a $30,000 contribution from the city. Additionally, America's River Corporation (ARC) would like to ask for the city's ARC Partner commitment of $10,000 for America's River Festival in 2014 America's River Festival 1 History: America's River Festival began as the Grand Excursion back in 2004. Embracing one of Dubuque's most monumental projects, the event gained fame instantly as crowds flocked to the Port of Dubuque to experience a historic event, featuring eight authentic paddlewheel vessels. Crowds gathered by the thousands to witness this piece of history, highlighted by the historic Steam Engine Train and vessels that had never been this far north on the Mississippi River. Additionally, live music, featuring acts by Kansas and Collin Raye, food and fun, all culminated in the Port of Dubuque, making a weekend to never forget. In 2005, The Grand Excursion was renamed to America's River Festival with the event signifying and embracing the Port of Dubuque transformation. This transformation is still ongoing and has seen upwards of $400 million dollars of investment to the area in the past decade. 2006 -2012 created many different memories for numerous fans from around the Midwest. Stihl Timbersports brought a fun and exciting energy to the port with competitions being aired on ESPN. The Hot Air Balloon release helped light up the night skies in 2007 and the Budweiser Clydesdale Horses made a guest appearance in 2008. DockDogs continues to make a strong impression in the community, as Dubuque was the host to the 2012 and 2013 World Championships after a 7 year partnership with the festival. 2009 was the highest attended festival to date and the state took notice as America's River Festival was named 2009 "Iowa Event of the Year" by the State Tourism Office. Attendance numbers continue to rise and our reach regionally continues to expand. America's River Festival, while young in age, has quickly become a signature event for the community and one that many local and regional visitors look forward to attending. Music Entertainment History: 2004: Kansas & Colin Raye 2005: John Michael Montgomery & Beatles Tribute 2006: Styx & Charlie Daniels 2007: Doobie Brothers & Randy Travis 2008: Kellie Pickler, Lady Antebellum, & Little Big Town 2009: Creedence Clearwater Revisited, Blue Oyster Cult, & Spazmatics 2010: Three Dog Night, Blood Sweat & Tears, Spazmatics, & Almost Queen 2011: Chicago, Foghat, KC & The Sunshine Band, & Starship Starring Mickey Thomas America's River Festival 2012: Marshall Tucker Band, Justin Moore, Starship Starring Mickey Thomas, & REO Speedwagon 2013: Dierks Bentley, Dee Jay Silver, Morgan Frazier, Parmalee, David Nail, Lynyrd Skynyrd, Arch Allies, Survivor, & Preservation Hall Jazz Band America's River Festival I Board Members /Partners: The America's River Corporation, which is made up of representatives from the Dubuque Area Chamber of Commerce, the Dubuque Area Convention & Visitors Bureau, The City of Dubuque, Dubuque Racing Association, Dubuque County Historical Society, Dubuque Main Street and Dubuque Initiatives governs the America's River Festival. The board meets monthly and America's River Festival is the main focus. All board representatives have a voice in budgetary and entertainment matters. Molly Grover is the current Board President. A total of five partners represent a base for a financial backdrop if the event would take a loss. To date, 4 of the 5 members, Dubuque Area Convention & Visitors Bureau, Dubuque Area Chamber of Commerce, Dubuque Initiatives and Dubuque Historical Society have contributed $30,000 each towards the $150,000 shortfall in 2013. It is our hope that the City of Dubuque will contribute $30,000 to help offset the remaining shortfall. In addition to the City of Dubuque contributing to the 2013 shortfall, we would like to request the City's commitment of $10,000 to the 2014 event. Currently, the proposed 2014 budget reports a $15,000 contribution from the Dubuque Area Convention & Visitors Bureau, a $10,000 contribution from the Dubuque Area Chamber of Commerce and City of Dubuque, a $5,000 contribution from Dubuque Initiatives, and a $1,000 contribution from the Dubuque Historical Society for a total of $41,000 from the partners. Lastly, The America's River Corporation plans to submit a grant request to the DRA in the amount of $25,000 that is not reflected in the partner contribution. America's River Festival I Budget Highlights: 2014 will mark the 11th year of the festival and 10th year of the festival being known as America's River Festival. In the 11 total years of existence, only two (2) years have resulted in a budget shortfall, 2007 and 2013. Below is a 5 year recap of the festivals bottom line for your review. Year: 2009 2010 2011 2012 2013 Profit /Loss: $28,224 $21,703 $13,964 $45,209 ($153,787) From the beginning, the Dubuque Area Convention & Visitors Bureau and Dubuque Chamber staff members have committed much of their time with no guarantee of being compensated. In the event of the festival showing a profit, a portion of the proceeds have gone to staff for their efforts. America's River Festival 1 2013 Festival Recap: 2013 represented a different scenario than seen in years past, including a more aggressive entertainment Tine -up and a loss on the bottom line. Given how successful the event had become in the previous years, the board voted and gave direction to secure bigger name entertainment for 2013. With bigger entertainment came bigger entertainment fees. To help offset the higher fees, the board voted to America's River Festival raise ticket prices from 2012. While our VIP and reserved tickets sales flourished, our general admission sales were down compared to national averages for the entertainment we had. Why did this happen? With sponsorship dollars on par from previous years and a fantastic weekend of weather, the board and Festival staff came to the conclusion that our price point for the local audience was too high compared to what they have paid in the past. Going in, the board was confident in our ticket prices, especially given that Dierks Bentley performed in Dubuque in 2007 with an average ticket price of $45. For 2013, our general admission price was $40 and included entertainment from 4:30pm- 1:OOam. While a $150,000 loss came as a shock to the board, it could be seen as a very good investment. Out of the area attendance numbers were very good tickets were purchased from 234 communities and 17 different states. The University of Iowa conducted a research project and concluded that the weekend of Americas' River Festival generated an economic impact of direct spending over $1M dollars. This is a significant number and utilizes no formulas into the final numbers. You would be hard pressed to generate the following results with a $150,000 marketing budget. America's River Festival 1 Future Outlook: The board agrees that a $150,000 loss was something that needed to be addressed and is not a sustainable model for the future. With that said, the board has agreed to move forward with a model similar to 2012. 2012 saw America's River Festival secure up and coming entertainment that was cheaper in price but not lacking in quality. It also offered a ticket price more attractive to our general admission crowd. Additionally, it is very important to the board that we submit offers to entertainment based off of what our sponsorship and partner dollars reflect and that we do not rely on walk -up ticket sales as a primary factor on our bottom line. Growth of Tourism: The Dubuque area has seen a steady and influential increase in the impact that travel has had in our community. According to the Travel Iowa Impact Study for Dubuque County, our region has seen a $153.72 million increase in travel related expenditures and an increase of $14.66 million in payroll for travel related employment, since 2002. The dollars generated by the hotel /motel tax, which are utilized for marketing Dubuque as a viable destination, has also reached an all -time high for fiscal year 2015. While our ability to market the area as a destination for travel plays an instrumental role in our success, our partnerships are equally as vital. It is imperative that we continue to manufacture unique experiences for the visitor that welcomes them into our community, and encourages them to visit again. These experiences allow us to reinforce the tourism infrastructure that currently exists with areas like the America's River Project in the Port of Dubuque. We believe that America's River Festival is among those experiences. In 2013, the efforts of the festival reached numerous communities and states. The estimated total direct expenditures from America's River Festival reached just over $1 million. The impact and reach this event had could not have been matched by a traditional marketing campaign. It is because of its history of success, and future potential, that we respectfully request your support of the 2013 shortfall and commitment to the 2014 America's River Festival.