New Sports Tourism Fund to be reviewed by panel

Delaware officials have released draft regulations on the Sports Tourism Fund. The proposal includes a panel to make recommendations in a public meeting. | DBT PHOTO BY JACOB OWENS

WILMINGTON — Approval of new sports tourism grants that will fund broad improvements for a venue that can be projected to draw fans and revenue will be determined by state officials and a review panel much like the other Delaware’s Strategic Fund programs, according to draft regulations of the program.

The Delaware Sports Tourism Capital Investment Fund, established by this fiscal year’s bond bill, would be open to high school, collegiate or recreational venues that “generates positive incremental state tax benefits” that can be demonstrated in a feasibility study or other evidence. The fund has a total of $12 million and there is no cap on grant requests from applicants.

Under the proposed regulations from the Delaware Tourism Office and outlined by the Office of the Registrar of Regulations, the taxpayer-backed grants could be used for “renovation, construction, or any other type of improvements to a facility.” It can also be used for equipment but not supplies.

The Division of Small Business will review all applications to ensure they meet the criteria. From there, an application and an evaluation will be submitted to a panel to make a recommendation. These meetings would be open to the public and scheduled on the state’s public meeting calendar.

“The review panel will consider the applications submitted and the funding amount allocated in the [FY 2024] Bond Bill when they evaluate project funding requests,” Tourism Director Jessica Welch told the Delaware Business Times in an email. 

When Gov. John Carney signed the FY 2024 bond bill into law this summer, he also created the Delaware Sports Tourism Capital Investment Fund. Proposed by Rep. Debra Heffernan (D-Bellefonte), the idea was to clearly set aside state funds for projects and renovations that would tap into the burgeoning sports tourism industry and bring regional or national appeal.

Previously, the Delaware legislature approved various projects on a case-by-case basis through legislation or bond bills. Notable projects funded that way include Frawley Stadium that anchors Wilmington’s Riverfront district, DE Turf Field in Frederica and the Chase Fieldhouse in Riverfront East. 

Like other programs in Delaware’s Strategic Fund, the Delaware Sports Tourism Capital Investment Fund depends on funding from the state spending plan. Strategic Fund grants range for job creation, lab renovation and more, and must be approved by the Council of Development and Finance, a board of appointed public officials.

But with Carney’s last year in office on the horizon and new leadership in the House of Representatives, it’s unclear what the future of the new Sports Tourism Fund will be beyond 2024.

To be considered eligible for the sports tourism grants, facilities must be open to the public and regularly host tournaments, championships or other events that draw out-of-state visitors, as well as holding “sufficient committed funds” to complete the specific project outlined in the application. 

Applications must show at least a one-to-one match of funds, but the review panel may also waive that requirement at its discretion. Facilities seeking the grants must also have a “useful life of length” and a detailed maintenance plan, as well as a funding source to pay for upkeep.

Other requirements include a detailed summary of the specific project for which the public funds would be used; economic studies and other reports completed in the last two years; and at least one letter of support from a state or local government official.

The review panel will include Welch, sports sales leader Ryan Wolfe, Joint Capital Improvement Committee Chair Sen. Jack Walsh (D-Newport) and Vice Chair Heffernan, Greater Wilmington Convention and Visitors Bureau Executive Director Jennifer Boes, Kent County Tourism President Pete Bradley, and Southern Delaware Tourism Executive Director Scott Thomas. Each member can appoint someone to serve in their place, according to the draft regulations.

The review panel will use a rubric that considers location, potential economic impact, other sources of funding, a detailed plan on how the funding will be used, and how the applicant will recognize the state’s investment in the facility. Other considerations on the table may include local support, ownership of the venue, site readiness, diversity of projects and need in the surrounding area.

The proposed regulations also include a recapture provision, with the Division of Small Business able to decide whether a successful applicant would repay all or part of the grant. Those cases may include part or total end of operations of the site or failure to complete the project in time. If the construction on the project fails to start in a certain period of time defined by the panel and the Division of Small Business, the state also has the right to recapture the money.

The Delaware Tourism Office will require data on attendance, hotel rooms booked for events as well as economic impact for the duration of the grant agreement. Annual reports on the construction or renovation projects as well as on the events held since are also required.

Public comment on the draft regulations should be sent to the Delaware Tourism Office before Nov. 1 at 4 p.m. Final regulations are required to be drafted by the end of this year.