ATLANTIC CITY — Miss America will call Boardwalk Hall home until at least 2018, but come September 2019, that may not be the case.
As the Miss America Organization’s contract with the Casino Reinvestment Development Authority enters its final year, some are wondering if paying nearly $4 million per year for the right to host the event is worth it.
“Something is going to have to change,” said Mayor Don Guardian, a member of the authority’s Board of Directors. “Maybe they can meet part of the way. That is a lot of money for 4,000 to 5,000 (people) who are paying on pageant night.”
Asked about the pageant’s future here, Josh Randle, president of the Miss America Organization issued a statement.
“Right now, our main focus and priority has been and continues to be dedicated to organizing and executing this year’s competition, but we hope to remain in Atlantic City for many years to come.”
In February 2016, Miss America and the state agency agreed to a three-year deal to keep the pageant in the resort through 2018. Under the contract, Miss America receives about $11.9 million in state subsidy during the life of the contract.
When the contract was approved, some, including the late State Sen. Jim Whelan, D-Atlantic, questioned the amount being spent on the pageant.
By comparison, the previous three-year subsidy package, which was part of the event returning to the resort after seven years in Las Vegas, totaled $7.3 million.
The discussion over the future of the contract begins as the pageant continues to slip in prominence, both in television ratings, and impact on the city.
“The Airshow has passed Miss America in terms of being the most popular event in the city,” Guardian said. “We don’t want to lose Miss America; we don’t want it to die. I think that something will be worked out.”
Since coming back to the resort in 2013 from Las Vegas, television viewers of the event have fallen by more than 2 million. In 2013, more than 8.6 million viewers tuned in to watch the event, by 2016 that number had fallen to 6.25 million.
When the contract was approved, those in favor touted the national exposure the city would get as part of their continued hosting of the show.
“The event is a positive part of the city’s brand/image with unknown value to the local community and economy,” said Rummy Pandit, executive director of the Lloyd D. Levenson Institute of Gaming, Hospitality & Tourism at Stockton University.
Discussions of the future of the event have already started among members of the state agency.
In May, as the authority’s Board of Commissioners approved allocating nearly $4 million for this year’s pageant, some expressed concern about the cost of the event in wake of the agency losing about $18 million in tax revenue. In January, the state agency was forced to give the city $18 million as part of the state takeover of the resort.
“Can we think about other initiatives in the city that could be of much broader value? It feels like these dollars could be repurposed.” said Kevin Ortzman, regional president in the Atlantic City region for Caesars Entertainment, during the meeting in May.
Ortzman was not on the board when the contract was approved.
As part of the current contract, the Miss America Organization is required to promote the resort during the opening of the pageant’s ABC telecasts.
When it was approved, the pageant’s hefty state subsidy was justified by more national exposure for the resort.
In exchange for the CRDA’s support of the pageant, dick clark productions, the producers of the event, agreed to include a live performance in Atlantic City in each New Year’s Rockin’ Eve show through 2019.
The program, broadcast on ABC, garnered 59 million viewers last year. The 2017 live remote failed to materialize because of “scheduling conflicts and other considerations,” according to the authority.
“The CRDA is proud to partner with the Miss America Organization to host the competition here on our Boardwalk,” Chris Howard, executive director of the authority, said in a statement. “Our partnership allows millions of television viewers and thousands of guests unique exposure to our great city and our world-class facilities.”
Before any new contract is agreed to, a study on the economic impact of the event must be done, Pandit said. Ahead of the pageant’s return to the city in 2013, the CRDA commissioned a study from NW Financial Group. That study estimated that the pageant was worth as much as $32 million in tourism revenue and $2.48 million in taxes.
“Without new research into the event’s economic impact it is impossible to say what type of return the CRDA will get on its investment in 2017,” Pandit said. “A study of the event’s economic impact would need to include, among other things, figures on visitation, consumer spending, parking and hotel occupancy as well as an assessment of the event’s economic value in promoting the city as a year-round destination.”