City of Austin trying to recover costs they lose to special events

SXSW is just one of more than 800 special events in Austin every year -- events as small as neighborhood parades and as big as South By and ACL.
At a press conference Wednesday, Austin Mayor Steve Adler revealed the total economic impact South By Southwest has on our city is $325.3 million.

"SXSW is just not a cash cow for the City of Austin, it is a herd that comes to our city and it migrates here every year," he said.

And that's all fine and good -- but a new report from the city reveals a slightly different perspective on special events and it's an issue the city is working to fix.
According to the newly released "Alternative Funding Methods For Special Events" report, in 2013 the city spent more than $6 million on the costs associated with special events and only collected $3.6 million in fees.  That's a $3.1 million shortfall.
In 2014, the shortfall was much less -- $1.8 million.
And in 2015, it was less than a million.

"We are now at about 88% cost recovery which is really good.  Some cities are around zero.  So Austin...we're doing good," said William Manno, the city's Corporate Special Events Program Manager.

Manno says there's a reason it's getting better.

"Some city departments have gone through a cost of service survey.  Like Parks and Rec and they have lined their fees to be more in line with the actual city cost," Manno said. 

Manno says the goal is to get 100% cost recovery. 

"One of the things that we recommend in the report is an across the board cost of service survey for every department that has anything to do with the events.  So we can ensure that all of the costs are covered," Manno said.

The report says the shortfalls are due to city co-sponsorships and because some events, like Mardi Gras, don't have a particular organizer.  So the city just ends up spending money on street barricades and cleanup but there's no one to send a bill to.
Fiscally conscious City Council Member Don Zimmerman was surprised the report actually revealed the not-so pretty truth.

"I expected it to come back to show 'Oh we're making millions of dollars for sacrificing thousands of dollars in fees' because that's typically what we hear back so I'm happy with the results of the report," Zimmerman said.

Zimmerman says he would like to see "Public safety" become a justifiable use for the Hotel Occupancy idea he says he's gotten pushback for.

"Yes we need to reallocate that and be using it for public safety because we have a public safety interest.  And the Hotel Occupancy Tax is a measure of how many people are coming in from outside Austin.  And we need additional public safety for those additional crowds.  It ought to come from the Hotel Occupancy Tax," Zimmerman said.

If you'd like to read the full report, click here.