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Statehouse Beat: State spends big on golf tourney

CHARLESTON, W.Va. -- Looks like the West Virginia Development Office is re-upping to be a major sponsor for the 2013 Greenbrier Classic PGA golf tournament, writing a $500,000 "down payment" check on Wednesday.

As in the past two years, the state has paid its $1.85 million fee to be a presenting sponsor of the tournament in installments -- which, among other things, allows the cost to be spread out over two budget years.

Commerce Secretary Keith Burdette says the sponsorship is a good investment for the state, providing days of unfettered access to business prospects, as well as an opportunity to provide a thank you to businesses that have located in the state.

"Every client we bring here, we get to spend at least a couple of days with, and usually longer than that, three or four days," he said. "We get to have a lot of time with these guys, and talk about a lot of business opportunities."

Burdette said plans are to tweak the state's sponsorship a little this year by giving the Division of Tourism a greater role, including hosting national tourism writers at the tournament.

"We are going to put a lot more emphasis this year on tourism outreach," he said.

In past years, Tourism has had a promotional display at the tournament.

Burdette said coverage of the tournament on the Golf Channel and on CBS is itself a showcase for tourism, with frequent commentary and video segments referencing the state's scenic beauty and tourism opportunities.

"You can't buy that type of positive publicity for the state," Burdette said.

(If you could, the price might be around $5.1 million, which is what the state has paid to Old White Charities since 2011 to be a tournament sponsor.)

This year's tournament runs July 1-7 (and Burdette said he's keeping his fingers crossed that Tiger Woods and Phil Mickelson will make the cut this year...

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Meanwhile, as one might suspect, the Greenbrier Classic is a major money loser.

According to the most recent IRS 990 filed by Old White Charities, the 2011 tournament produced total revenue of $19,528,290, and had total expenses of $25,005,628, resulting in a net loss of $5.44 million.

Tournament expenses came in at $9.76 million, while "other" was the largest expense category at $10.8 million. Travel costs amounted to $1.936 million, while management costs were $680,267. Advertising and promotional costs were $321,478.

The tournament gave out $665,400 in grants and aid to various organizations, considerably less than the $3 million a year Greenbrier owner Jim Justice

said in 2011 he hoped to generate for charitable organizations each tournament.

A lot of the grant money went to golf-related organizations, including $50,000 to the World Golf Foundation in Florida, and $20,000 to the West Virginia Golf Association.

Local grants included $40,000 to the West Virginia School of Osteopathic Medicine, $25,000 to the Remember the Miners foundation, $8,500 to the State Fair of West Virginia, and $15,000 to Greenbrier East High School Band Boosters. (Justice coaches boys' and girls' basketball at the school.)

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Old White Charities paid The Greenbrier hotel $2,029,853 for "assisting with operations of the Greenbrier Classic," and paid Parking Unlimited of Catawba, S.C., $876,264 for parking consulting; $796,440 to Kirby Rentals of Orlando for rental of tents and tables; $731,852 to T&B Equipment of Ashland, Va., for bleacher rentals; $584,137 to Prom Management Group of Oakdale, Minn., for catering; and $368,800 to CCI Events of Baton Rouge, La., for decorations.

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The tournament lists total liabilities of $10.21 million, with most of that being in the form of more than $10 million in loans outstanding. Justice Family Group LLC has loaned $7.45 million, while James Justice Cos. Inc. loaned $2.58 million.

(According to the 2010 990 form, the Justice Family Group made a $3.046 million loan and a $2.77 million cash contribution for that year's tournament.)

Meanwhile, expenses for the big-name concerts associated with the tournament (this year, Kenny Chesney and Aerosmith) are not booked through Old White Charities, which means Justice's loss on the tournament is probably considerably bigger than $5.4 million. ... No wonder he's resorted to busing gamblers into The Greenbrier casino ...

However, Justice did get some of that investment back, receiving compensation of $462,079 in 2011 as president, treasurer and director of Old White Charities; while James Justice III received $89,271 and Jillian Justice, $53,090, as directors.

Also, directors Steve Sarver received $192,848 compensation, while Robert Cochran was paid $171,431.

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Finally, be sure to take time today to give mom a hug, or at least a phone call, or if neither is possible, take time to reflect on the many terrific things she did for you over the years ...

Reach Phil Kabler at philk@wvgazette.com or 304-348-1220.


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