EXCLUSIVE: Study Says Super Bowl XLV to Have $611M Impact on North Texas

The official study contracted by the North Texas Super Bowl XLV Host Committee has found that more than $611 million in revenue will come to the region as a result of the game being played on Feb. 6, 2011, in Arlington. That’s far higher even than the more-than-$500 million figures we’ve heard from the event’s organizers in recent months. If accurate, that would indeed be a record–outperforming the $500 million that some credit Super Bowl XLII with generating.

The number was determined by Marketing Information Masters, a La Mesa, Calif.-based firm that has conducted economic impact studies for previous Super Bowls, as well the 2007 NHL All-Star Game and the 2010 NBA All-Star Game in North Texas. Their work was sent to the Texas State Comptroller earlier this month for review.

The report states that $611 million is the estimate of “direct spending” by all non-local residents during a two-month period leading up to game day. That seems high compared to the direct spending figures I’ve seen for previous games (more in the ($125-$300 million range) so I asked the Host Committee about whether that includes any indirect spending or multiplier effect–or to make any comment on the report. Their spokesman said it’s premature to comment on these numbers, since the committee doesn’t consider them final and official until after the Comptroller’s review of the data (due to be complete by March 8). There could be adjustments to this information at that time.

For more tidbits from the report, take the jump. We’ll start with how Dallas may make out better than Arlington in this deal.

  • Dallas will see $298 million in direct spending at its hotels, venues, and restaurants. Arlington will get a $135 million benefit. Arlington is servicing the debt on the $325 million it authorized to help build Cowboys Stadium, paying about $20 million a year. Dallas is not.
  • The Comptroller is looking at the numbers to determine how much to set aside in a Major Events Trust Fund. Robert Wood, the director of governmental assistance for the agency, told me they aren’t really checking out the entirety of the $611 million claim. They’re merely looking to see how much extra sales tax the state of Texas will see as a result of the event. To that end, they’re only interested in how much will be spent by non-Texans since a guy from Houston coming to spend money in Dallas (that he may have just spent in Houston if he’d stayed home) doesn’t benefit the state government. Marketing Information Masters puts the contribution from out-of-state visitors at about $375 million.
  • The Major Events Trust Fund is a mechanism by which the state will set aside an amount equal to the estimated incremental increase in tax revenues to be used to reimburse the Host Committee and local governments for expenses that they outlay in hosting this event. So, for example, if Dallas has to put extra officers on the street at a given time to police an event like the NFL Experience, which will be at the Dallas Convention Center, they can get some money back from the state to offset that.
  • The Host Committee, based on the impact study, is requesting that $36.2 million be deposited in the trust fund for Super Bowl XLV. By contrast, the Comptroller’s office says that $8 million was placed into a fund for the 2004 Super Bowl in Houston.
  • As noted before, most sports economists are skeptical of figures even in the $300 million-or-above range. They say that these studies don’t include factors like “leakage” or “displacement.” A number of economists whom I recently asked for estimates of Super Bowl XLV’s true impact placed it anywhere between $30 million and $200 million. They were willing to allow the idea that, since Cowboys Stadium is the largest venue to host the game in quite some time, the impact could well be on the high side of their guesses.

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