Pittsburgh has hosted pro all-star games, golf championships and NCAA basketball tournaments. But if it wants to land more big-time sporting events, including a Super Bowl, it might need a sports commission to help close the deals.
That was the pitch being made Tuesday by VisitPittsburgh to rally support for a plan to increase the Allegheny County hotel tax by 1.25 percentage points to create and fund such a commission.
Also, Mayor Bill Peduto said local officials have not given up on efforts to develop a new hotel at the convention center but will further refine proposals to limit requests for public subsidies.
After spending the past year laying the groundwork for the sports commission proposal, VisitPittsburgh plans to submit legislation to the state General Assembly within the next month to raise the 7 percent tax on hotel rooms for that purpose and others.
The local tourism agency estimates the increase would generate $6 million a year, with $1.5 million of that dedicated to the sports commission.
The rest would be used to help bring more conventions to town, to establish a dedicated source of funding for the Pittsburgh Film Office, to make community parks tournament-ready for sports-related events, and to help fund the Visit Monroeville tourism agency.
Craig Davis, VisitPittsburgh CEO, said before the group’s annual meeting Tuesday that the commission would help to make Pittsburgh a “much stronger player” in efforts to attract major sporting events.
The $1.5 million would be used to fund sports commission staff and operations, to help with travel and marketing in trying to lure sports events, and to offset the cost of hosting them. Mr. Davis said most commissions also have someone on staff to recruit companies to sponsor events.
A sports commission, Mr. Davis said, also could be helpful in trying to attract a Super Bowl for Pittsburgh in 2023. The Steelers have asked the NFL for permission to bid on that Super Bowl, although landing the big game is still considered a long shot.
Nonetheless, Mr. Davis said many of the cities that have hosted Super Bowls have had sports commissions to lead the effort. In all, more than 100 cities in the U.S. have such commissions.
“If Pittsburgh is serious, and we are, about bringing a Super Bowl, then we’re going to have to have an entity that will drive that effort and that effort cannot be driven by the Steelers. The NFL does not want the teams to drive that effort. The community has to and that community support has to come through a sports commission, in my opinion.”
Any increase in the county’s hotel tax would have to be approved by the state Legislature and enacted by county council.
VisitPittsburgh plans to ask the General Assembly for authority to increase the tax by 2 percentage points. But it wants county council to raise the tax by 1.25 percentage points, reserving the rest for the future.
Mr. Peduto and county Executive Rich Fitzgerald support the creation of the commission, as do the Steelers and the Penguins. “I think we’re leaving some opportunities on the table,” Mr. Fitzgerald said.
Asked whether he would support the accompanying tax increase, Mr. Fitzgerald said, “I’m supportive of what the industry is supportive of.”
The Greater Pittsburgh Hotel Association backed the proposal last summer. Association executives could not be reached for comment Tuesday.
Mr. Davis has said that the tax increase would fall mainly on out-of-towners. Less than 1 percent of those who rent rooms in the county actually live in the county, he said.
At current average room rates, a 1.25-percentage-point increase in the tax would add $1.48 to the bill, VisitPittsburgh estimated. Even with the increase, Pittsburgh still would have one of the lowest hotel taxes among its competitive set, Mr. Davis said.
But the increase could generate another 61,000 room nights, $57 million more in direct spending, $3 million more in state sales tax and $1.5 million more in hotel tax through additional sporting events and conventions, the agency maintained.
As for the hotel at the convention center, the Sports & Exhibition Authority last year had requested proposals from developers interested in building one.
But Mr. Peduto said none of the five satisfied the city, county or SEA, in large part because of the large public subsidies demanded. Some developers wanted direct subsidies, revenue sharing, or even a cut of concession revenue.
The mayor said local officials are now working with hotel industry experts to craft a proposal limiting the amount of public subsidy involved while providing the public with a return on its investment. He acknowledged there could be a need for “some subsidy.”
“We still feel very strongly that there’s a strong market. It’s been proven that as Pittsburgh becomes more and more of a tourist destination year-round, having the ability to have a hotel that would be connected to the convention center could be very profitable,” Mr. Peduto said.
Mark Belko: mbelko@post-gazette.com or 412-263-1262.
First Published: March 22, 2016, 4:52 p.m.
Updated: March 23, 2016, 3:31 a.m.
