BolderBOULDER Budget, Finances and Reserves

FINANCIAL STABILITY

Some years ago, a reporter who had covered the BolderBOULDER for many years, was describing the Denver International Marathon, which, when it failed, left about $300,000 in unpaid bills. These unpaid amounts included monies due to off-duty policemen, municipal services to the City of Denver, and suppliers of services and products as well as the athlete’s prize money of over $80,000.

He logically inquired about the BolderBOULDER’s financial stability. We believe that it was appropriate to share with him and anyone who has an interest, BolderBOULDER’s philosophy about our responsibilities of financial stability. So since then we have shared the finances of the race.

We realize that there are many who are interested in our present and long-term financial stability, as it is certainly an important ingredient for us to be able to continue to deliver a first-class experience to BolderBOULDER participants. We believe that you should know what, as the “caretakers” of the event for Boulder and Colorado, we are doing to insure the long-term financial stability of the BolderBOULDER.

As with businesses, municipalities, families, and individuals, the BolderBOULDER should maintain financial reserves of sufficient strength to provide for the myriad of unexpected events, which inevitably occur. These could be unexpected expenses or reduction in income. A business which has unexpected expenses cannot go to its customers and simply ask a higher price for its product to cover its shortfall. Just as a city, which has a reduction in sales tax, revenue cannot just go to its citizens and demand higher taxes. The planning for unexpected events and fluctuations require having financial reserves to cover contingencies.

Reserves by their very nature are funded over time. An important question arises as to the adequacy of reserves or the target amounts to have available. We have determined that the BolderBOULDER should have reserves to bridge over revenue shortfall (which, for example, could be caused by a downturn in the economy) in amounts equal to one year’s sponsorship revenue plus the amount to fund one year’s professional athlete’s budget.

In addition, because there exists, the possibility of weather conditions so severe the race would have to be postponed, we have determined the additional costs to stage the event one week later, and have added that amount to our target. Of course, as the race grows and therefore the cost to stage it increases, the amount of reserves becomes a moving target, which generally increases each year.

We are building our safeguard reserves following economically conservative principles with the belief that it is better to be prudent. We want all of you who are interested in the BolderBOULDER to view our approach as reassuring to the event’s financial stability.

Should an economic downturn or any other equally unforeseen circumstances present themselves, you can be assured the BolderBOULDER has provided accordingly, and will continue to be a viable entity.

On average the race can make contributions to reserves in about three out of five years, which should eventually get us to our goal. In addition, our founder, has committed that in the event of income shortfalls or unexpected expenses, he will provide the amount to cover any cash flow problem (and has done so twice in our twenty-nine year history).

WHAT DOES IT COST TO STAGE THE BOLDERBOULDER (2007)

The following is a breakdown of the BolderBOULDER expenses by major category. Included in these figures are the some of our unique expenses:

· CU requires that the BolderBOULDER cover the floor of the stadium to protect the turf, $51,046.

· Scaffolding in the stadium and on the course, $31,914.

· $15,000 for portable toilets.

· Prize money for pro-athletes is $152,550
(the largest non-marathon prize purse paid anywhere).

· Transportation, accommodations, and meals for pro athletes exceeds $60,000.

· Results, Timing, Scoring: $98,250 (for 2008 it is estimated to be $125,000)

SUMMARY OF BOLDERBOULDER EXPENSES

• Race shirts (design/printing), race numbers, inventory costs: $281,392 (10.4%)
• Printed materials (forms, banners, event collateral, etc): $ 93,785 (3.5%)
• Postage (entry form, finish certificates, medals, etc): $103,466 (3.9%)
• Marketing and Advertising, PR/Communications, Design. $267,366 (10%)
• Logistics, equipment (rental, maintenance, repair) depreciation, Course management, start-line management, entertainment: $268,338 (10%)
• University of Colorado (costs associated with facilities use
  including stadium floor, parking, etc.) $ 82,671 (3.1%)
• Law Enforcement, Security, Security consulting, Emergency Services (City of Boulder Police, Colorado State Patrol, CU Police, Ambulance) $ 40,394 (1.5%)
• Stadium: Audio, Memorial Day Tribute $ 19,179 (.8%)
• Professional Race (travel, meals, lodging, prize money, recruiting, massage, scoring, etc $ 232,257 (8.7%)
• Food $ 45,384 (1.7%)
• Charities, Non-profits, Volunteers, Race Official Gear $ 71,505 (2.7%)
• IT/computer (programming, software develomement, maintenance, web development, web hosting, on-line) $142,333 (5.4%)
• Professional (Attorney/CPA); Bank Fees, Insurance $ 151,623 (5.7%)
• Facility: Warehouse, Office Administrative, Supplies,
  seasonal stores, utilities (phone, electric, gas, water, trash, etc) $143,986 (5.4%)
• Staffing: full-time (including benefits), seasonal and temporary staff, independent contractors $ 642,884 (24.2%)
• Taxes (sales, use, admissions, real estate) $ 64,812 (2.5%)
• Misc: $ 9,727 (.5%)

TOTAL $2,661,194

Based on 50,816 registered runners in 2007 it would have taken an average entry fee of $52.37 to cover these expenses.  Thanks to sponsor contributions we are able to set our entry fees below this amount and remain financially stable.

To view a 2004 Daily Camera article about the race's finances, click here.