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Star Tribune (Minneapolis, MN)
Super Bowl LII brought attention to the Twin Cities — and $370 million.
That was the net new spending from the 10-day event Jan. 26-Feb. 4, according to an economic impact report released Tuesday by Gov. Mark Dayton.
The results, which are in dispute, came in $50 million over pre-event projections by Rockport Analytics made years in advance. Rockport, based in Pennsylvania, also wrote the final report.
Much of that larger-than-anticipated number was attributed to $179 million spent by broadcast and event planners — the most for a Super Bowl.
The $370 million figure was reached after subtracting about $80 million for displaced tourism (people who were kept away from the area by the event).
From his State Capitol reception room, Dayton reveled in the report along with Super Bowl CEO Maureen Bausch and Rockport analyst Kenneth McGill. "The success of the enterprise is just phenomenal," Dayton said. "Now they have the results to show for it."
Sports economist Victor Matheson was skeptical. "The Super Bowl is definitely positive, but nowhere near the $450 million positive in terms of dollars in local people's pockets," he said.
A look at the numbers
The Rockport analysis counted some 125,000 tourists, defined as visitors from at least 50 miles away or spending a night in hotel. And it counted some 1 million visits to Super Bowl Live, which includes multiple visits by the same people.
The report also said the game brought in $32 million in new tax revenue for state and local government.
For context, the $370 million is a little bit more than 1/1,000th of the state's economic output of just over $300 billion. It's also equal to a little less than two days of Target's revenue.
Minneapolis chief financial officer Mark Ruff's office is still crunching the numbers on the precise impact the Super Bowl had on city revenues. He expects to present it to the City Council in June.
Ruff said revenue exceeded expectations. Taxes were in the neighborhood of what was expected, he said, but other revenue like parking charges came in stronger than anticipated.
He noted, however, that the economic impact report counted increased property tax revenue.
Minneapolis doesn't consider that part of its ledger when assessing these events. "Hotels and such get built and are sustained by tourism," Ruff said. "We don't count on increased property taxes from those kind of events. We just think that those structures are here."
Revenue from the countywide sales tax charged by Hennepin County to pay for Target Field rose about 7 percent in February compared with the prior year, showing a Super Bowl "bump." The same tax revenue was down in January and March, compared with 2017.
"I would say it's probably a minor thing for us," said Hennepin County Budget Director Dave Lawless.
Bausch said the event would have a "lasting legacy," making the Twin Cities a destination for tourism and business travel. She pointed to the report's finding that 83 percent of the first-time visitors surveyed said they planned to return.
The 10-day event included free concerts that were packed every night despite bitter cold and activities such as ziplining over the Mississippi River, a snowmobile jump over Nicollet Mall, snowtubing and the Kitten Bowl.
The event accounted for 476,000 visitor days, including 396,000 overnight stays and 80,000 day trips, according to the report. The Super Bowl generated more than 266,000 hotel nights with an average daily room rate of $249, the report said. Metrowide, 84 percent of the available hotel rooms were occupied.
Breaking down the demographics, the report said more than 95 percent of Super Bowl LII visitors were from outside Minnesota, with 6 percent from outside the country. The remaining 5 percent came from Minnesota but stayed overnight in paid rooms or traveled more than 50 miles on a day trip.
The majority, 71 percent, were men. Their average age was 47 and almost half earned at least $150,000 a year. They stayed an average 3.9 days and spent $608 per day.
Prof: Numbers don't add up
Matheson, a College of Holy Cross sports economics professor, dismissed the report, saying it "throws out the same sort of estimates without much in the way of real data" and doesn't account for costs.
The hotel occupancy data doesn't add up, he said. For example, the report claims 125,000 visitors came to the Twin Cities for the game, but there were only 17,000 additional hotel rooms sold. So the net increase in tourism has to be a fraction of what is claimed, he said.
Also, much of the extra revenue didn't stay in Minnesota, he said. "The added hotel revenues go almost exclusively to corporate profits, not into locals' pockets. Same with retail sales. If a local retailer sells a $150 [Philadelphia] Eagles jersey to a visiting fan, other than a small retail markup plus the sales tax, that money all goes back to the NFL," he said.
McGill defended the post-event numbers as "honest" and painstakingly checked. "It's not spinning some number one after another to come up with an answer or an outcome" that planners wanted, he said.
Carter Wilson, vice president of consulting and analytics for Tennessee-based STR, which tracks hotel data, said hotel room revenue rose notably because Minneapolis is typically not busy in February.
"We expected the increase to be on the upper end of what we've seen in other cities," Wilson said. "It was definitely that."
Wilson said revenue per available room, a measure of hotel business, rose by 626 percent. That's second only to Indianapolis for Super Bowl host cities since 2011, he said.
The Super Bowl is one of the biggest and most complicated national events a city can host and some of the numbers show that.
The Minneapolis-St. Paul International Airport set a record with more than 60,000 travelers passing through security on their way out of town on the day after the game. Metro Transit reported more than 210,000 additional rides, including game-day ridership.
In bidding to host the game, the Twin Cities, like all host communities, had to agree to hundreds of conditions to provide services and spaces at no cost to the NFL.
Not the least of them was the taxpayer-subsidized $1.1 billion U.S. Bank Stadium that opened two years ago.
The Minnesota host committee was required to raise more than $50 million from corporate sponsors. A big chunk of that, $7 million, went toward reimbursing public safety costs to state and local law enforcement.
Having hosted the most complex Super Bowl yet, the next big challenge for the Twin Cities: The NCAA men's basketball Final Four in April 2019. Rockport's forecast is that the Final Four will bring $124 million in net spending to the region and $23 million in tax revenue.
Staff writer Evan Ramstad contributed to this report.
BIG GAME, BIG IMPACT
Economic impact: $370 million, $50 million more than projected by planners.
Tax revenue: $32 million.
First-time visitors: 83% said they plan to visit again.
84 percent: Available hotel rooms used by tourists.
60,000: Travelers flying out of MSP day after, a record.
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