Will Holliday | Crest Road
Recently a study on Fairgrounds fiscal impact was completed by Economic & Planning Systems, Inc. (EPS) and delivered to the cities of Solana Beach, Del Mar and the Fairgrounds/22nd Agriculture Association. At the request of the Del Mar City Council, the study was reviewed by Del Mar’s Finance Committee for detailed analysis and comments which will be shared at the June 6th City Council meeting.
The study provides a number of actual data points that citizens of the City of Del Mar and Solana Beach should find useful in further understanding fiscal impact of the Fairgrounds. For example:
• How much revenue does Del Mar receive from horse racing (On-track and Off-track Betting)?
Answer: $116K in FY2014/2015.
• How much Sales Tax revenue does Del Mar receive from On-Site sales at the Fairgrounds?
Answer: $605K in 2014 and representing 37% of Sales Tax Revenue.
However, significant concerns were raised regarding the crude methodologies used in an attempt to estimate how much of Del Mar’s $2.4M in Transient Occupancy Tax (TOT) revenue is correlated to the Fairgrounds events and how to allocate significant annual expenses of the Sheriff costs of $2.1M and Fire/Medical $2.3M.
As a result, the study includes misleading conclusions that overstate the net fiscal impact, since it is based on an overstatement of TOT Revenue and understatement of both the Sheriff and Fire/Medical expenses. These concerns have been shared with the Del Mar City Council and will be considered as part of the June 6th council meeting.
The EPS study should serve as a catalyst for more discussion around the fiscal impact of the Fairgrounds, but it should not be taken as fact, or considered valid. If additional funding sources and interest exists to pursue a more thorough and accurate analysis, perhaps a more meaningful set of conclusions can be reached.
In the meantime, we should continue efforts to further understand Del Mar’s broader current key revenue contributions, future revenue options and key expense drivers in order to enable Del Mar to pursue the community’s priorities.