Get ready San Diego. The invasion begins tomorrow.
Clad in their visors, shorts, ball caps and stay-dry polo shirts, and armed with their sunscreen, periscopes and water bottles, the invaders, who hail from near and far, will land and hang around through June 15. They will stalk a Tiger relentlessly, but hope to get a close look at an Angel as they prowl Torrey Pines Golf Course.
The behemoth known as the U.S. Open Golf Championship is on its way and, with it, tens of thousands of golf fans, volunteers, security and media from around the world.
Unlike Genghis Khan's guys, this horde is not coming to pillage treasure, but to spend it. How much of it stays local and how much pours into the coffers of the nonprofit United States Golf Association, its sponsor, may spur some debate. The larger part of that debate is how valuable and important it is for a region to host an event such as the U.S. Open.
When the U.S. Open came to Oakmont Country Club last June it was like King Kong dropping in on New York City.
The seven-day event was more massive than the monstrous movie gorilla and just as influential on its surroundings.
It was, in the lingo of the 1960's, a happening -- a happening that involved at least four years of intensive planning by the USGA and officials from the state, Allegheny County, Oakmont and a few other municipalities.
As expected, the chance to view the greatest golfers in the world competing for the American national championship of golf on one of the country's most storied courses drew tens of thousands of visitors to the Alle-Kiski Valley. Public officials and business people touted that influx as a shot of economic adrenaline for the Valley and the region.
But, with the Open juggernaut steaming to its 2008 gig, its impact here remains a matter for debate.
Revenue neutral
Holding an event with the magnitude of the U.S. Open does not come without costs, especially when it comes to public services. Police are a good example of that. Dozens of officers from local municipalities including Plum, Oakmont, Indiana Township, Harmar and Tarentum were involved in traffic and security duties related to the Open.
It was all done after their regular shifts but the overtime costs for police were paid for by the USGA as part of the cost of doing business.
However, the municipalities did not gain any revenue from that.
Nor did Plum Borough, the municipality where virtually all of the Oakmont course lies. Plum saw no direct, major financial dividend from any fees or permits connected to the Open.
Plum officials issued two general permits -- one for trailers and another for tents --- that were placed on the Oakmont grounds. They were used for concessions, media headquarters, hospitality sites and restrooms. Permits for such structures usually cost 18 cents per square foot, but Plum issued the two permits for a total of $12,888.
"The fee is based on square footage, but they had asked council for a reduction because it would have been about $60,000," said Greg Bachy, Plum's code enforcement officer. "Since we could just inspect one after the other, they would not have to go back multiple times, so council agreed to it.
"We had five people up there for two weeks at about eight hours a day so we really didn't make anything on it," Bachy said. "We probably spent about $10,000 to $12,000 of staff time inspecting them."
Not a stretch
The borough of Oakmont apparently fared a little better.
According to Roger Dunlap, the borough manager at the time of the Open and now an assistant borough manager in State College, Oakmont required the USGA to buy a $10,000 special events permit for the Open.
"Something of that magnitude, you have to understand it has an impact on the resources of the borough," Dunlap said. "I kind of view it as a reimbursement to the taxpayers from the USGA for the impact they have on the infrastructure and so forth.
"We have only three street workers so the week before, those three guys were pretty busy because they still had their regular duties," Dunlap said.
He said that Oakmont's small public works crew spent time erecting signs, but worked only a little bit of overtime, for which the USGA reimbursed the borough.
"They didn't stretch our resources, they didn't deplete us and they didn't stretch us too thin," he said. "They only asked us to do what we would normally do. Anything that we could put a hard cost on they agreed to pay for."
Delightful results
For the USGA, there is no debating the Open's impact. They considered it a resounding success long before the 2007 champion, Angel Cabrera of Argentina, hoisted the trophy.
Successful enough that Oakmont Country Club officials will be anxiously awaiting the announcement of the Open site for the years beyond 2015. They are hoping it will return to Oakmont for what would be a record ninth time.
"Oakmont has indeed extended an invitation," said Pete Bevacqua, the USGA's chief business officer. "We will of course consider that. One thing we will stress is that we were absolutely delighted with the 2007 U.S. Open."
And why not?
Attendance at the tournament for the week totalled 258,967, according to figures released by the USGA. That averages out to 36,995 per day. For the final four days when the championship rounds were played, attendance totaled 179,723, averaging 44,931 daily.
But those figures are somewhat skewed, according to Bevacqua. He said they accounted for not just the paying customers but those with credentials who passed through the scanners at entry gates every day. That includes the thousands of volunteers assisting with tournament operations, vendors and even the media covering the championship.
"Our Opens vary so much and the profitability of an Open is due to the size of the crowds that could be accommodated," Bevacqua said. "At a U.S. Open, we could sell 50,000 to 60,000 tickets and sell out, but what we want to do is make it a good experience.
"We try to determine what is the best spectator number. We were in the 35,000 ticket range for the Open."
A powerful engine
Still, with practice round tickets going for $35 to $50 each day and tickets for the four championship rounds selling for $95 to $140 each, the USGA had little to complain about. Even if all the tickets sold to one championship round were sold at the lowest price, it meant a one-day take of $3,325,000.
Over four days that would come to more than $13 million. Again, that is not factoring in tickets sold at higher prices. Nor does that include the receipts for the three practice-round days, which at the lowest ticket price, came to between $2.5 million and $3 million.
Not exactly chump change for the USGA, which is a nonprofit organization.
There is more, however. For example, the proceeds from U.S. Open merchandise, which actually was being sold at the club's pro shop for at least a year before the championship.
Mary Lopuszynski oversees merchandising for USGA, and said that the 36,000-square-foot Merchandise Center at the course sold out of 93 percent of its stock during the tournament. That meant even more of a financial windfall.
Consider one item, golf shirts. Lopuszynski said 75,000 golf shirts were sold during the Open at prices that started at $47 and exceeded $100 for certain brands or styles. If all the golf shirts sold were priced just at the low end, it would come to $3.5 million.
Start ringing up the proceeds from T-shirts, ball markers, hats, golf umbrellas, books and dozens of other items sold at the merchandise tent and the total merchandise sales figure is no doubt breathtaking.
That is pure speculation since USGA does not release financial information to the public on its events, but it does to the Internal Revenue Service.
The 2006 Open at Winged Foot in Mamaronek, N.Y., a New York City suburb, the USGA sold $12 million in merchandise at a $6 million profit, according to the association's fiscal 2006-2007 tax return. Not all of those sales were at the golf course itself. Returns for 2007-08 and figures for Oakmont's Open are not yet available.
Throw in the money from TV contracts, concessions and corporate sponsorships and it's obvious why Marty Parkes, the former USGA communications director, described the Open as "the engine that pulls the train" for the USGA.
Hitching a ride
Just how far it took the Pittsburgh region is the lingering question.
Attracting at least one high profile event to the Pittsburgh region every year is the goal of VisitPittsburgh.com and profiles don't get much higher than the U.S. Open.
The national championship of golf is the stuff of which dreams are made for the nonprofit organization, which promotes tourism and economic growth in the Pittsburgh region.
"Each year we are going to target some visible event that it is on national television and covered by hundreds of reporters that helps us dispel the image that we have acquired over the past 150 years," said Joe McGrath, president and CEO of VisitPittsburgh.
Beverly Morrow-Jones, communications and marketing director of VisitPittsburgh, said the organization estimates the economic impact the Open had on the region was $59.7 million. Overall, she said it was worth even more than that.
"It's immeasurable," she said. "Look at the visibility and the exposure. It was just incredible; you just can't buy that. It's a big coup to have something like that here."
However, there are those who think that when the media spotlight shifts elsewhere, the residual effect lasts about as long as a Tiger Woods slump.
"We generally don't make a big deal about it because it is a one-time thing," said Jake Haulk, president of the Allegheny Institute for Public Policy, a conservative think tank based in Pittsburgh. "It's nice, it's better than getting nothing, but it is not the way the community, in the long run, is going to build the economy.
"When people come in and go to a golf tournament, it is not going to affect whether they are going to move here or move their business here," he said. "I discount that kind of stuff because next year the tournament will be held somewhere else and they will make the same claims."
Tax proof
To get some perspective on the benefits of the region hosting the U.S. Open, McGrath said one needs to go only as far as the Allegheny County Controller's office.
"The hotel tax collection for Allegheny County for the month of June was the largest ever collected," McGrath said. He ought to know since his nonprofit economic development organization receives a percentage of the tax to fund its operations.
"It does show record numbers," said Pam Goldsmith of the controller's office. "It shows a jump of $760,000."
She said the hotel tax collection in July of 2006, which is actually the receipts for June, was $2,009,825. In July of 2007, the hotel tax collection came in at $2,770,112, a 37.8 percent increase. In terms of events, there was nothing going on in the region with the same profile as the U.S. Open.
"I think that there were tremendous revenue opportunities and you have to take all those and add them up and then subtract what the expenses were," McGrath said.
Jake Haulk, president of the Allegheny Institute was not surprised by the hotel tax increase.
"I assume that is true because not only were they (hotels) full, they were jacking up their rates."
He estimated that the 50,000 hotel rooms in the region were renting for at least $200 a night and hotels in downtown Pittsburgh were getting as much as $400 to $500 per night. Haulk concedes that an event such as the Open will bring more people from other places into the region and they will spend money, so in that sense the region benefits, but only in the short term.
"It's a one-time deal," Haulk said.
Benefit and doubt
McGrath disagrees, as does Larry Werner, a board member and communications chairman for Oakmont Country Club and also a former partner in the huge advertising/public relations firm, Ketchum Communications.
Werner believes the experience that out-of-towners had here was positive and it will spread good will for the region.
"People who were here said they loved being in Pittsburgh," Werner said. "They said the people of Pittsburgh treated them well and they had a great time. I'm not saying that the corporate headquarters for Wal-Mart will move here because of it, but it was a positive experience."
"The nature of golf is that it is the business sport," McGrath said. "People use it for interaction, to get to know each other. When you spend four hours with someone you have the opportunity to build a total insight to them."
"What we find is that those who follow professional golf tend to be some of our target audiences," he said, referring to CEOs and marketing professionals. "When you see the 'who's who' of who is buying the tickets, it is the corporations making multimillion-dollar deals and determining destinations. Where are they going to put a plant? Where are they going to expand their own business?
"The whole thing in destination marketing is you have to get someone to give you a second look."
Haulk argues that corporate leaders with an affinity for golf attend The Masters tournament that is held every year at Augusta National Golf Club in Augusta, Ga., but that hasn't turned Augusta into a Mecca for corporations.
"I don't believe that. I don't believe that happens," Haulk said. "Maybe it happens on very rare occasions, but it is not the norm. They are going to look at the taxes, they are going to look at the labor climate, they are going to look at all the things that corporations look at and they are going to come to the same conclusion: that Pennsylvania is not a welcoming climate for business."
But McGrath is adamant in his belief that the national and international exposure from events such as the Open is invaluable to the region.
"We found that it really does make an impact," he said. "It makes an impact that goes on for years. How could I ever afford to buy the kind of air time that ESPN and the networks put in? I couldn't ever begin to afford that."
Werner echoed that sentiment and said it underscores the need for a comprehensive marketing strategy for the region, one that pulls all its educational, cultural, medical and sporting assets together.
"Anything that shines a spotlight on Pittsburgh in a positive way is of value," Werner said. "We haven't packaged everything like the Open, the Penguins, the Pirates, the Steelers, the cultural district and sold them as a package.
"I believe that is one of the problems because, when you put all of that together, we have one of the best regions in the country but who packages it and sells it on a day-to-day basis?"
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