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Friday, January 18, 2019
Town renews contract with Breckenridge Tourism Office for $4.7 million in 2019
In renewing the town's contract with the Breckenridge Tourism Office, Mayor Eric Mamula painted the independent nonprofit group as one of the best marketing agencies that money can buy.
"Right now, the BTO is an outstanding partner," Mamula said during discussions, adding that leadership at the tourism office has made it "as good as an organization gets."
While the mayor expressed deep satisfaction with the BTO, he said "nothing lasts forever" and mentioned that should things change, the town could terminate the new five-year contract with 30 days' notice.
The BTO had been operating on a three-year contract, but it expired in December. The new contract is largely a rewrite of the one from 2016, when the town agreed to pay BTO $3.8 million for promoting the town. Some minor tweaks were made to the new agreement, but the nuts and bolts remain intact.
The scope of services includes marketing the town as a year-round resort community, which means selling Breckenridge as a year-round destination in the spring, summer and fall seasons while supporting Breckenridge Ski Resort throughout the winters.
For the BTO's work, the town will pay the organization $4.7 million in 2019 and amounts to be determined each subsequent year of the five-year contract.
"We're very grateful for the trust council has in us, and we have a tremendous partnership with them because town services and the business community deliver well on the messaging we put in the marketplace," BTO director of operations Lucy Kay said. "It's a nice synergistic circle."
IRS tax filings show the BTO received $3.9 million in contributions and grants in 2016 and $4.8 million in total revenue. Some of the revenue came from event sponsorships and smaller line items.
The office spent $1.3 million on staff salaries, compensation and other benefits that year. Kay pulled a salary of $159,792 with $8,052 in other forms of compensation.
According to a budget provided by Breckenridge town staff, the amount the BTO received in town funding grew to $4.1 million in 2017 and then $4.5 million in 2018.
This money comes largely from a one-percent increase in the town's accommodations tax approved in 2011, and the money may only be spent on implementing its marketing program.
More funding from the BTO — no less than $150,000 annually — will come from Breckenridge Ski Resort, according to the document. That's been in place for decades, Kay said.
Breckenridge Town Council's discussion about renewing its contract with the BTO last week lasted less than four minutes.
Prefacing the conversation, town manager Rick Holman told council members the contract didn't require any formal action on their behalf, but he wanted to make sure they were OK with the agreement before he signed it. Also, a draft of the proposed contract was included in the agenda packet, along with the BTO's 2019 marketing plan.
The marketing plan outlines the BTO's biggest initiatives of 2019 while breaking down some of its goals, such as delivering out-of-state destination business, increasing lodging occupancy rates and pushing 2-3 percent growth of Breckenridge's revenue.
The BTO also aims to even out business traffic throughout the year by attracting "the right guests at the right time."
Later in the marketing plan, the BTO hints at whom these guests might be, as it describes narrowing the BTO's top 100 media list to its top 25 markets, including California, Arizona, Texas, Florida, Chicago, Kansas City, New York and Atlanta.
Some challenges facing Breckenridge are mentioned in the marketing plan. They could be economic downturns, competing ski pass programs, wildfire concerns, guest service in the community and perceptions of the town. Other threats could come from Interstate 70 traffic, limited early season snowfall and increasing regulations on social media.
On the other hand, the BTO also sees new opportunities to better control Breckenridge's branding and even snag some of the market share from competing resort communities, specifically Aspen and Vail.
The BTO is also contracting with third-party lodging referral vendor JackRabbit and implementing other new software changes to help meet its goals, in addition to crafting a destination management plan. Kay said the management plan is "the single-biggest project" and "arguably the most important work" the BTO will do this decade.
Other provisions in the new contract speak to record-keeping, intellectual property rights, a dispute-resolution process, promoting Breckenridge's sustainability efforts and protecting the town against the employment of undocumented workers.
The contract also mentions finding a suitable replacement for the Dew Tour in 2019, as it won't return to Breckenridge in 2019, to fill out the town's December lineup of events. Additionally, the BTO is working in a partnership with the ski resort to turn Breck Pride into one of the town's signature events.
Kay said they're considering pulling Ullr Fest into early December to help make up for the Dew Tour going away, though nothing has been decided at this point.