Springdale commission trims budget

Advertising, promotion panel cuts 5 percent because tax revenue down

SPRINGDALE — Members of the city’s Advertising and Promotion Commission approved a 2019 budget of $477,000 Monday afternoon during a meeting of the Springdale Chamber of Commerce. That total reflects a slowdown of revenue coming into the commission from a 2-cent sales tax charged in Springdale.

Aerial Courdin, vice president of marketing for the chamber, said the tax earned the city about 3 percent less than the first 11 months of 2017. The tax is charged to hotel guests for each night’s stay.

The 2019 budget reflects a 5 percent cut from 2018 because members of the commission wanted to be conservative, Courdin said.

As a result, placement of advertising for the city in various media outlets will be cut. For 2018, the commission provided about $130,000, she said. The 2019 total is $119,000.

Courdin said she didn’t expect the cuts to feel drastic. Several 2018 projects fell through, and she said she expects the commission’s expenditures for advertising to total only about $110,000 at the end of the year.

She also noted Springdale Chamber of Commerce staff now works in house to develop and order those advertisements, saving fees paid to advertising agencies who did the work in the past.

Perry Webb, president of the Springdale Chamber of Commerce expressed no concern over the drop in revenue. The shortfall equals about $15,000 for the commission.

“That’s the equivalent of about two trade shows at the

[Northwest Arkansas] Convention Center and one football game,” Webb said.

Webb said a shift in the market place caused the shortfall. For many years, most corporate meetings in Arkansas were held in Little Rock, then organizers moved them to Springdale. Now the meetings once again are held in Little Rock.

“We’ve got more competition in the region,” Webb continued. “There are so many facilities in Benton County to host these events. We’ve only got one. We haven’t had the only convention center in Northwest Arkansas since 2002.”

Webb said he thinks most communities in Northwest Arkansas are seeing similar drops in revenue, and the effect merely is cyclical.

“We’ve had it drop 2 percent three years in a row, but then it bounces back,” he said. “Last year is was 9 percent up.”

Webb also noted the commission holds about $300,000 in reserve that could sustain it through several years in an economic downturn.

He said many people ask why the commission sits on the money, rather than spending for Springdale.

“What do you want us to spend it on,” Webb replied. “There’s not enough for big stuff like building a convention center. Sure, we could spend it on more advertising. But the right usage hasn’t come along.”

Webb said the reserve money is not budgeted. The commission is very efficient and comes in below budget many years. That extra cash is banked, Webb said.

“As recently as Friday, there was a discussion about spending the money on a big opportunity that might be coming to Springdale,” Webb said.

If the city’s purchase of the former All-Star Sports Arena goes through, for example, the commission might have the money to sponsor a large sporting tournament, which can have a much bigger impact on the city than advertising. Or the commission could provide the city with money through grants to cover additional ball fields with artificial turf, allowing for larger tournaments.

“Our No. 1 philosophy is to do events to generate and grow tax money,” Webb said. “What facilities in the city’s parks would attract people from out of town to use the parks and stay in area hotels?”

Webb also mentioned courting Red Bull, which built and sponsored a Pump Track BMX biking competition in the city in October. The company also sponsors large airplane and boat racing events, he said.

“I’d rather having it sitting safe and secure in the bank,” Webb said. “And when the proper, impactful event comes along, we’ll cash some of it in.”