American Alliance for Health, Physical Education, Recreation and Dance - AAHPERD

 Issue: April 2006

Financing Facilities 101
Thomas H. Sawyer

Abstract:
Successful sport entities have a variety of stable revenue sources to meet increasing expenses. There are three major categories of revenue sources: public, private, and a combination of public and private sources. It is extremely important for the sport manager to ensure that all varieties of revenue streams are maintained. The public sources of revenue primarily include hard and soft taxes, tax abatement, nontaxable and taxable bonds, tax incremental financing, and special bonding authorities. The private sources include grants, donations, in-kind contributions, naming rights, concessionaire exclusivity agreements, premium restaurant rights, sponsorship packages, lease agreements, luxury suites, premium (club) seating, personal seating licenses, parking, merchandise revenues, food and beverage serving rights, advertising rights, broadcast rights, vendor or contractor equity, real estate gifts, and bequests and trusts. This article discusses why all sport entities should have a financial team and how best to secure funding for updating facilities or creating new facilities.

Article category: Facility Design and Development-Part 1