Rotorua Lakes Council gave this year's Crankworx Rotorua festival an additional $75,000 to bring funding levels in line with previous years and address cost pressures.

More than 14,000 people walked through the gates at this year's event, which organisers called "the best yet".

Crankworx Rotorua 2018 was also named the Best Sport Event of that year by the New Zealand Events Association, just days after the 2019 festival drew to a close.

Rotorua has a contract to host part of the Crankworx World Tour every year through to 2027, alongside other top mountain biking destinations around the world.

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Maxxis Slopestyle at Cranworx 2019. Photo / File
Maxxis Slopestyle at Cranworx 2019. Photo / File

The week before the event began, the Rotorua Daily Post reported that 2019's event would be the first year public investment in the Rotorua event would be less than investment from businesses.

Since 2015, non-commercial investment in Crankworx Rotorua, from local government, central government and trusts such as the Rotorua Energy Charitable Trust, had reduced.

Event director Ariki Tibble's told the council's Operations and Monitoring Committee it was "absolutely critical" the trend was reversed.

"Events like this can't exist without public investment," he said.

"When you've got something like this and you're ahead of the game and things are going really well, you don't take your foot off the gas."

Ariki Tibble at the Skyline Rotorua Crankworx site. Photo / File
Ariki Tibble at the Skyline Rotorua Crankworx site. Photo / File

Crankworx Rotorua is not for profit and only employs one full-time staff member year-round, and another for the six months leading up to the event.

The rest of the organising team are volunteers from the Rotorua area.

Tibble said overseas events similar to Crankworx Rotorua did not rely on the goodwill of volunteers and private sponsorship to the same extent.

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Mountain Bike Events Limited then sought an additional $75,000 of support from the council to help with covering the newly added Enduro World Series in Rotorua and some of the shortfall from other decreased public or philanthropic funding as longer term commitments were scaled back since Crankworx first launched in the district.

The full council last week approved a recommendation that came from the Operations and Monitoring Committee to provide the additional financial support.

In a statement yesterday, the council said there was capacity to meet the request by diverting some other mountain bike-related operational costs from existing sports, recreation and environment budgets.

Rotorua rider Keegan Wright (right) at Crankworx Rotorua 2019. Photo / File
Rotorua rider Keegan Wright (right) at Crankworx Rotorua 2019. Photo / File

"As discussed with council last year, it was intended to keep the event affordable for spectators (particularly locals) so ticket revenue would grow with attendance rather than pricing. With attendance weather dependent, it was a difficult revenue line to forecast, the Operations and Monitoring Committee was told."

The Rotorua Tourism Investment Partner Incorporated Society (RTIP) previously provided $75,000 for the 2015, 2016 and 2017 events.

However, this additional contribution was not made for the 2018 Crankworx event.

The council's statement said the budget for the 2019 Crankworx event had a number of additional costs compared to the previous year, including community activations and professional services for business development and sports operations due to the increasing size of the event, and wider range of races and competitions.

"The 2019 event also incorporated a round of the International Enduro World Series that required a hosting licence fee of $70,000. Other operational costs have steadily increased as the event has become larger and more successful on the international stage, the Operations and Monitoring Committee was told."

Revenue from the associated bike and parts supplier expo has remained steady over the last few years as space is fully utilised.

Revenue from ticket sales grew initially but then decreased last year, despite an increase in numbers attending, due to lowered ticket prices.

Tahnee Seagrave riding the qualification round of the Pump Track Challenge at Crankworx 2019. Photo / File
Tahnee Seagrave riding the qualification round of the Pump Track Challenge at Crankworx 2019. Photo / File

The matter was dealt with in the confidential part of both the committee and full council meetings to enable commercial negotiations to continue without prejudice or disadvantage.

The decisions and the report, which went to the Strategy, Operations and Monitoring Committee, are now released to the public.

Deputy mayor Dave Donaldson declared a conflict of interest at both meetings and did not take part in discussions or voting on the matter.

Last month, Rotorua Energy Charitable Trust manager Tony Gill said: "Our trust committed to fund the first three years of the event in Rotorua [a total of $250,000] in order to give Crankworx organisers certainty during this establishment period."

"This year, Crankworx organisers didn't submit an application for funding given the understanding we had with them."

Background

The council has supported the event in the last four years with a direct event sponsorship of $75,000 from the sport, recreation and environment division's major event sponsorship budget.

This is committed to continue to 2021.

As part of its support for the event, the council also underwrites Mountain Bike Events Limited to a maximum of $500,000 for the 2015-2021 period.

To date, $94,000 of underwriting was required in 2015 and $39,000 in 2016.

The underwriting was not required in 2017 or 2018 and payments of $12,000 in 2017 and $11,000 in 2018 have been returned.

Crankworx by the numbers

$4.21m economic impact on Rotorua's economy in 2018 (18.49m since 2015)

Crankworx visitors stay for an average of 7.4 nights in Rotorua

International viewership was 12.4m in 2018 (up from 11.4m in 2017 and 4.6m in 2015)