Recession and Super Bowl and NFL and Donations and Sports Business

Corporate donors standing by $25M Super Bowl pledges

July 6, 2009

Most of the companies that agreed to help underwrite the 2012 Super Bowl are standing by their commitments even as the recession wreaks havoc on their businesses.

Of $25 million pledged by more than 80 companies before last year's bid process, only about $1 million is at risk, said host committee head Mark Miles. And some of that $1 million likely still will be paid, Miles said, though donors want to modify the five-year payment schedule to preserve cash during the recession.

The host committee has been quietly approaching other potential donors to make up for the shortfall. And even though the big game is about 940 days away, event officials already are working out details for the festivities from a suite atop Pan Am Plaza.

Some of those details appear in bid documents, recently reviewed by IBJ, that helped Indianapolis land the game. They include a local cable channel dedicated to the Super Bowl; branded Super Bowl key cards for every downtown hotel; and promotional building wraps for the Emmis, Simon and IPL headquarters.

The bid committee must cover the NFL's cost for advertising in local media, to the tune of at least four billboards, 20 pages in newspapers, and 250 live or prerecorded TV or radio spots.

During the event, the group must maintain a one-mile-wide "clean zone" around Lucas Oil Stadium to prevent any non-NFL-sanctioned marketing activities. And it might temporarily relocate the U.S. Post Office facility across from the stadium.

Those with NFL credentials will enjoy free access to the zoo, museums and attractions, along with a Friday night party at the Indianapolis Motor Speedway and the use of three local golf courses and a bowling alley.

The city will pay up to $2 million for public safety expenses, and public and private sources will be tapped to fund a Super Bowl "legacy initiative," including a new practice facility at Tech High School. The remaining local expenses will be borne by the host committee.

A big focus now is organizing a small staff to manage more than 6,000 volunteers during the event. The plans call for 15 paid positions.

During a visit to Indianapolis in June, NFL Vice President Frank Supovitz congratulated the city on being way ahead of most host cities this far from the game.

In particular, securing corporate commitments before Indianapolis even bid for the game proved a smart move.

"We're pleased that pledges were secured before the economy soured," said Miles, who also serves as CEO of the Central Indiana Corporate Partnership. "It would have been very, very difficult to raise the money in the second half of 2008 or to date in 2009."

The bid committee would not disclose the amounts companies committed. It also would not reveal which firms had reneged on commitments or sought a new payment schedule.

If the fund-raising pledge drive had just begun, locally based City Securities Corp. probably still would have given, but the decision would have been less of a slam-dunk, said Michael Bosway, CEO of the 85-year-old company.

"This is a once-in-a-lifetime, maybe even corporate lifetime, event that means a tremendous amount to the community," Bosway said. "This is a long-term investment in the community that will have lasting effects for the city and community."

The Indianapolis host committee hasn't done its own study of the game's potential economic impact, but direct spending in other Super Bowl cities has ranged from $140 million to $400 million, Miles said.

Observers say the sturdy support of the business community is a good sign for the Indianapolis host committee.

"If that's all they've lost in terms of commitments, they're in a very good position," said Robert Tuchman, executive vice president of Premiere Global Sports, an Illinois-based sports travel and marketing firm.

The game itself is far enough out that the economy—and corporate expense accounts—have some time to recover, said Tuchman, who names Indianapolis as the nation's second-best city for hosting major events in a new book called "100 Sporting Events You Must See Live" (Miami is No. 1).

He said last-minute corporate cancellations were the biggest downer for organizers of the Super Bowl earlier this year in Tampa; companies didn't want to be seen as partying at the Super Bowl as the economy spiraled out of control. Similar fears also could hold down interest in the next two games, in Miami and Dallas.

But most believe some manner of recovery will have taken hold by 2012.

"I hope by 2012 we're in a pretty robust economy," said Dan Appel, CEO of Gregory & Appel Insurance, a 125-year-old local company that jumped at the chance to help fund the Super Bowl effort.

"If not, we might have a lot more to worry about than the Super Bowl," he said.

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