The city’s contribution to the Dollar General Bowl has increased since Mobile first reached an agreement to host the game at Ladd-Peebles Stadium, but some question if the game featuring participants from the Mid America Conference and Sun Belt Conference is a good return on investment.
The agreement stipulates that the city give the bowl $1.15 million per year, but the city is to be reimbursed with sponsorship money, city spokeswoman Laura Byrne wrote in an email. Because of those terms, the city’s contribution to the game has increased steadily since the current contract was signed in 2006.
“Sponsorship money has declined from $900,000 during the early years of GMAC sponsorship to $600,000 for GoDaddy to $200,000 for Dollar General,” Byrne wrote. “The city is paying $1,150,000 per year and receiving $200,000 in sponsorship money, or a net of $950,000.”
Byrne added the contract runs through 2020 and has no early-termination clause.
The city has not performed an economic impact study of the game, but Chris Keshock, Ph.D., a University of South Alabama associate professor in the Department of Health Kinesiology and Sport, performed a meta-analysis for bowl game organizers in 2010.
Keshock said the study, which is different from an economic impact study, used data from 14 to 15 other events and bowl games, as well as information from the organizers, to develop the study. The analysis is a mixed bag.
“When people take a look at these things there are so many perspectives,” Keshock said. “When a politician says we give them all this money, I tend to take it with a grain of salt.”
In the analysis, Keshock estimates the fiscal impact of the game to Mobile at between $255,445 and $292,506. When the city was contributing only about $150,000, the return on investment was 70 percent to 95 percent, according to the analysis.
However, the direct spending generated by travelers to the game was estimated to be between $8.6 million and $9.5 million. New spending generated from the bowl game is about $1.5 million annually and the overall impact to the local economy was estimated at between a conservative $18.2 million and an optimistic $19.9 million. The increase in additional spending led to between 119 and 130 jobs.
Approximately $405,445 to $442,506 is generated in city and state tax revenue, and $101,626 is generated in county tax revenue from the bowl game and tourism-related spending each year, according to the analysis.