WestWorld to enter into contract with Arizona Quarter Horse Association

WestWorld will enter into a contract with the Arizona Quarter Horse Association to produce two annual events and define revenue shares between the two organizations among other components of the new contract (Submitted Photo).

Scottsdale City Council unanimously approved three resolutions regarding WestWorld’s contracts with the Arizona Quarter Horse Association and Parada del Sol as well as a budget appropriation transfer during its Tuesday, Jan. 17 meeting.

In the first resolution, WestWorld would enter into a 10-year contract, with the option of a 10-year extension, with AzQHA to produce the Arizona Sun Country Quarter Horse Circuit, which will move from January to early March, and the Arizona Fall Championship.

This would include the Parada del Sol Rodeo.

The contract also allows food and beverage rights to return to WestWorld. WestWorld General Manager Brian Dygert said during the Jan. 17 meeting Sun Country originally obtained food rights.

Additionally, this resolution would terminate the existing Facility Use License with Arizona Quarter Horse Breeders Association, which began on Nov. 1, 2000.

The second resolution authorized the termination of WestWorld’s current three-year contract with Parada del Sol.

Parada del Sol will become a subcontractor with AzQHA and the city would no longer have any direct business dealings with the company, Mr. Dygert said.

Council also approved a fiscal year 2016-17 General Fund capital contingency budget appropriation transfer of $229,000 to a newly-created capital project called North Hall Arenas per the third resolution.

The system includes the purchase of two 120-by-230-foot movable arenas that can go in the North Hall area of WestWorld.

Specifically, the WestWorld Basin Management Fund will cover $209,000 of that total while the General Fund will provide $20,000 to cover overhead costs, according to Mr. Dygert’s presentation.

With the approval of the new arenas in the North Hall, the association will start making $45,000 yearly payments for the next 20 years as part of its commitment to help pay off the debt the city accrued during the expansion.

Mr. Dygert said AzQHA was not comfortable starting the payments until it knew it would have arenas in the North Hall as a response to Councilman David Smith’s inquiry on the payment.

“I would be remiss if I didn’t say that I’m a little unhappy the payment didn’t start sooner,” Mr. Smith said. “We obviously built the facility a number of years ago based on commitments from all three of the principal sponsors but we are where we are.”

The other two sponsors have been making their payments for the past two years. Mr. Dygert said the association fully intends to pay for 20 years, despite not paying for the first two.

Mr. Dygert said this issue was one of several pieces in a puzzle to finding equal ground that led to the resolutions.

“What we did was sit down for the last year — the Parada group, Arizona Quarter Horse Group and us at WestWorld — and try to figure out what was our future and what was the solution,” he told the city council.

“This contract is basically the answer to that whole puzzle.”

From a monetary standpoint, AzQHA is slated to pay a Base-Use Fee of $49,500 for the March event with a $100 per stall rental fee. For the September event, the Base-Use Fee is $38,300 with a $55 per stall rental fee.

The Base Use Fee is fixed until 2019 and from 2020 to 2035, the fee will see a 2 percent escalation rate each year, Mr. Dygert said.

The contract lines out AzQHA receiving 20 percent of food revenue and 30 percent of alcohol revenue for the rodeo. For the event that is not a rodeo, AzQHA would receive 10 percent of the food and alcohol revenue.

The association also would receive 20 percent of all bedding revenue and 10 percent of RV revenue from the March event.

In the September event, the association looks to receive 10 percent on both food and alcohol revenues as well as RV revenue. As for Bedding revenue, AzQHA is slated to get 15 percent.

Mr. Dygert outlined the value of both events as of their most recent outing. According to the presentation, the January event, which will move to March, made $360,249 while the September event made $130,121.

Councilman Guy Phillips, who made the motion to adopt the resolutions, ended the discussion by thank-ing those who put together the contract for their work.

“You can see how complicated (the contract) is and what you have had to work on these last couple of years,” he said. “These are top events, top tourist draws and we have to make sure this thing passes.”

News Services Reporter Josh Martinez can be contacted at jmartinez@newszap.com or at 623-445-2738

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