Gov. Greg Abbott has agreed to spend up to $2.7 million in taxpayer funds to bring the barrage of blood, sweat and spandex that is WrestleMania to Texas next year.
During his 2014 campaign for governor, Abbott expressed discomfort with such taxpayer-funded economic incentives, saying he wanted to get government "out of the business of picking winners and losers.”
But last week, his office signed off on the award from the state’s Events Trust Fund, state records show, one of 20 such awards approved since September. That's when the governor's office took the reins of a few incentive programs designed to strengthen Texas' hand in vying for large sporting events and conferences from the state comptroller's office.
The Events Trust Fund is designed to defray the costs of some large events by payingstate taxes collected during the events, such as those levied on hotel reservations and car rentals, back to event organizers. Local governments or nonprofits they authorize must approve the events, and the cities that host them are required to chip in some of their localtax receipts, too.
In just over three months, Abbott’s office has approved more than $26 million in incentive awards for 20 events, according to a review of state records. Nearly three-quarters of thatmoney, $19.5 million, is assigned to a single event, this year’s Formula One race in Austin. That award has been a source of controversy, as it is less than the $25 million the race has received in state support in the three previous years.
Officials in the governor’s office say that figure is lower than it was in previous years because they are calculating tax revenue gained from such events differently than the comptroller did. A September report from the State Auditor’s Office found that the comptroller’s office was at times overly generous in calculating some awards by factoring in estimates of tax revenue that were not permitted under state law.
“With this change came consistency, accountability and increased efficiency for the state’s event trust fund programs,” said Cait Meisenheimer, a spokeswoman in Abbott’s office.
Bernie Ecclestone, chief executive of the Formula One Group, told the Austin American-Statesman last month that the reduction in state support could lead to the event’s cancellation.
After Formula One, WrestleMania is the largest award Abbott has approved. WWE, which puts on WrestleMania, announced in January that its 2016 event would be held at AT&T Stadium in Arlington. Multiple venues around the country lobbied for the event, which could have an economic impact akin to a Super Bowl, according to Marty MacInnis, chief financial officer for the Stadium Events Organizing Committee, which handles such bids for AT&T Stadium. Organizers are hoping to draw more than 90,000 attendees, which would be a record for the event.
“It’s a massive event,” MacInnis said. “... They’ve got fan festivals. They’ve got golf tournaments. They’ve got rallies. It’s one of those things where people from all over the world will come to this.”
The potential for a state subsidy helped the organizing committee plan out its bid and determine how much it could ultimately agree to pay WWE, MacInnis said. The total funding WWE is receiving for the event is still being worked out, he said.
“The trust fund played a part in the decision to try and bid for the event,” MacInnis said. He added that while organizers weren't sure they'd get the incentive funds, they were optimistic.
The other 18 events approved for incentives by Abbott’s office each drew awards of less than $1 million. The Irving Tennis Classic, scheduled for March, drew the smallest state award at $27,959.
Since 2004, the state has spent more than $300 million subsidizing over 500 events around the state, according to state records. Under state law, the Events Trust Fund can defray the costs of an event in which a Texas venue is in competition with other sites. A separate Major Events Reimbursement Program handles subsidies for a specific list of high-profile events, such as Super Bowls and Formula One races.
The Texas Tribune provided this story.
