International AIDS Conference in 2004
The Economic Development Committee recommends the adoption of the following
report (September 2, 1998) from the Commissioner of Economic Development, Culture
and Tourism:
Purpose:
To seek the support of Council for the potential hosting of the International Aids Conference
in 2004.
Funding Sources, Financial Implications and Impact Statement:
No immediate financial implications.
Recommendations:
It is recommended that:
(1)Council confirm its support, in principle, for Toronto as the host city for the International
Aids Conference in 2004;
(2)staff report to the next meeting of the Economic Development Committee on mechanisms
whereby the City, in association with Federal, Provincial governments and the private sector,
could provide a loan guarantee in the amount of $1.0 M required to secure the Aids 2004
conference;
(3)staff report on the merits of developing a formal support program whereby the City, in
association with Federal, Provincial governments and the private sector, could provide bid
support for upcoming major convention bids; and
(4)the appropriate City Officials be authorized and directed to take the necessary action to
give effect thereto.
Background:
Staff have received a request from the President of the International Aids Society, confirming
that a local organizing committee has submitted the City of Toronto as the candidate to host
the International Aids Conference in 2004. As a prerequisite of this submission, the
organizing body requires a loan guarantee in the amount of $1.0 million be provided by the
host community.
The City of Toronto presently does not have a formal mechanism whereby such a loan
guarantee can be provided. The former Metro Council established a Tourism Event
Development Loan Program in 1994 for the express purpose of assisting in the up-front
financing of special events in support of Metro's tourism strategy. This program's terms of
reference, attached as Appendix One, were designed to encourage cultural, sport or
entertainment events of significant duration which could generate incremental visits by the
leisure traveller. The parameters of the fund do not easily apply themselves to convention
bids.
Recognizing the significant economic impact that conventions do contribute to a city, this
report also proposes the possible reconfiguration of the City's funding program to
accommodate major convention bids.
Comments and/or Discussion and/or Justification:
(1)Aids 2004 Conference
The Aids 2004 Conference provides the City of Toronto with an exceptional opportunity, both
to capture substantial convention spending by attending delegates, as well as to help support
the positioning of Toronto as a world leader in the medical/pharmaceutical research industry
as part of its economic development strategy.
Economic impact estimates provided by the International Association of Convention Bureaus
(IACVB) puts the direct impact of the anticipated 15,000 delegates to this conference at a
value of $17,280,000.00 to the Toronto economy.
Obtaining this conference is of particular interest to Toronto, given its potential to profile our
position as a North American centre of medical research and to profile the network of
biotechnology and medical equipment firms which are linked to this medical/educational
complex.
In the absence of a detailed business plan for a Toronto bid, we can look to the experience of
Geneva this July 1998 as typical of this bi-annual event. In Geneva an estimated 11,000
delegates came from 136 countries and spent five days discussing the scientific and
community aspects of HIV/Aids. Financing for the Geneva event was generated by participant
revenues (40 percent), sponsors (45 percent) and exhibitors (15 percent). A guarantee of 2.5
M Swiss Francs was guaranteed by the State of Geneva. Principal sponsors for the event
included major medical/pharmaceutical firms such as: Abbott Libraries, Bristol-Myers
Squibb, Du Pont, GlaxoWellcome, Roche and technology companies such as Hewlett
Packard. The budget for the event was approximately $18.9 Million with an estimated surplus
of $365,000.00 being achieved.
The organizing committee expects that five other cities, Hong Kong, Rio de Janeiro, Salvador
del Bahia (Brazil), Birmingham and Vienna, will submit bids to host the 2004 conference.
The organizing committee for the Toronto bid is being led by Dr. Mark Wainberg from
McGill Aids Centre, an internationally recognized scientist in the field of HIV/AIDS who
recently assumed Presidency of the International AIDS Society.
The requirement by the International Aids Society to provide a $1.0 M loan guarantee to
pre-finance the costs of the conference is unique to the experience of Toronto's tourism
industry. In Vancouver, which hosted the 1996 conference, this loan guarantee was provided
for by a local hospital, Tourism Vancouver and the Province of British Columbia. This
conference generated demand for 9,300 rooms in the city.
Recognizing the significant opportunity that this opportunity could provide for the City of
Toronto, staff recommend that consideration be given to the provision of a loan guarantee and
that staff be directed to immediately commence discussions with the Provincial and Federal
Governments, Tourism Toronto and other private sector interests to determine possible
mechanisms whereby a loan guarantee could be provided to the bid committee by December
1998.
(2)Support for Other Convention Bids
Conventions are an important source of business to Toronto, with 800 to 900 conventions held
annually in this City. In 1997 Toronto received an estimated 898,000 convention delegates at
911 events, generating 1.1 billion in revenues.
While the above strategy responds to the immediate needs of the Aids Conference, it should
be noted that Tourism Toronto and the City of Toronto receive numerous requests to support
convention bids on an ongoing basis. At the present time there are at least two large
conventions on the horizon that will likely be coming forward with requests for financial
support.
While support for conventions by the City has ranged from protocol involvement, facilitating
business linkages, staff participation on organizing committees, hospitality-related activities,
provision of in-kind services and facilities, Toronto does not have a formal mechanism to
respond to convention bid support requests.
Looking more broadly, the City does have a mechanism in place to support events rather than
conventions. In 1993 Metro Toronto Council approved the concept of establishing a loan
program to assist in the up-front financing of special events for the purpose of tourism and
economic development in support of Metro's tourism strategy. Council, at that time, was
interested in creating a funding mechanism to facilitate "blockbuster" tourism events at no
cost and minimum risk to the Metro Corporation.
The Barnes Exhibition at the Art Gallery of Ontario (AGO) was recommended as a pilot
project to test the feasibility of a loan program concept with the AGO receiving a loan in the
amount of $1.0 million. The event was very successful with respect to out of town visitor
attendance, media coverage and revenue generation and the AGO repaid the loan to Metro in
full including interest charges.
Based on the success of the pilot, Metro Council approved guidelines for a permanent
Tourism Event Development Loan Program which was subsequently used to support tourism
marketing costs associated with the White Lions Exhibition at the Metro Toronto Zoo and
upfront financing for the Festival of the Future. It should be noted that there is no dedicated
source of revenues to support this loan program. Proposals were critically reviewed on a case
by case basis, due diligence conducted by Economic Development, Treasury and Legal staff
and monies to provide this funding were drawn from the City's current account. Further, the
terms of reference of this program clearly spell out that any funding is to be repaid to the
Corporation including interest charges. The program was directed to support the efforts of the
not-for-profit public attractions in diversifying their tourism product as compared to bids by
local convention organizing committees.
In the past Tourism Toronto and the Metro Toronto Convention Centre created a Convention
Development Fund which was designed to support major conventions and did not apply to
events. Due to funding pressures, this program was discontinued in 1994 and the organization
continues to support bids on a case-by-case basis including room revenue rebate programs put
in place by its members to subsidize the costs of hosting a convention in Toronto. Other
Canadian and US destinations who compete with Toronto for conventions have the ability to
present more financially attractive bids typically as a result of revenues generated by a visitor
tax. Discussions have taken place on the possible institution of such a revenue source for
Toronto's tourism industry, however no consensus has been reached by the industry in
support of such an initiative.
It is also interesting to note that the City of Montreal, which does not have a room tax,
typically is able to offer a secured loan (bridge financing) to local organizing committees as
the Government of Quebec will guarantee such loans under certain conditions.
Tourism Toronto and the City continue to react to convention bids and request for support on
an ad-hoc basis. Recognizing the growing competitiveness of the lucrative convention market,
and the significant investment which has been made by all levels of government in convention
and trade show facilities in Toronto, staff recommend a revisiting of the City's existing
Tourism Event Development Loan Program to explore ways its might be applied to major
convention bids. Alternatively, this review may suggest that it is more appropriate to institute
a new program that responds to the specific requirements of the convention market and allows
the existing program to continue to focus on the development of blockbuster events. Appendix
Two outlines the conceptual differences between convention and events that will form the
basis of this evaluation.
Conclusions:
This report recommends that the City support, in principle a future bid for the 2004 Aid
Conference due to the associated Economic Impacts and potential to position Toronto as a
leader in the context of international medical research. The report further recommends
undertaking the necessary due diligence and negotiations to facilitate the provision of a $1.0
million loan guarantee in support of this bid.
Recognizing the potential that conventions have to enhance the City's economy, this report
also recommends a revisiting of the City's funding mechanisms, to explore ways in which we
can elevate our support for major convention bids in association with other levels of
government and the private sector.
Contact Names:
Christine Raissis, Manager, Business Development, Economic Development, 392-3385
Eva Pyatt, Director, Business Development, Exhibition Place, 393-6076
Brenda Librecz, Managing Director, Economic Development, 397-4700
1IACVB estimate is not calibrated specific to Toronto, rather based upon a survey of its 75
member bureaus. Assumptions are based upon convention duration of 4.19 nights and per
delegate spending of $1,152.00 on accommodation, meals, sundries and ground
transportation.
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Appendix One
Tourism Event Development Loan Program Terms of Reference1
Purpose:
To support incorporated not-for profit organizations to create, expand and solicit major
exhibitions and events capable of generating incremental tourism to the community, in turn
generating economic benefits to Metropolitan Toronto.
Eligible Activity:
Loans can be made to support one of a kind "blockbuster" sporting, cultural, entertainment
and multi cultural events that can demonstrate increased ability to attract a significant
percentage of attendees from outside of Metropolitan Toronto by participating in the local
program.
Priorities:
(1)Events that have a high probability of attracting overnight visitors to Metropolitan
Toronto;
(2)Events that take place throughout Metropolitan Toronto resulting in economic benefits
throughout the entire region; and,
(3)Events that allocate at least 35 percent of their marketing budget to out-of-town markets.
Limits:
Loans will not exceed $1 million. Applicants will be expected to repay the Corporation the
full amount of the loan plus interest and/or service charges to be negotiated on a case-by-case
basis. Disbursements and repayment schedules and use of funds will be negotiated as part of
the terms and conditions of the loan agreement.
Evaluation Criteria:
The following criteria will be used to evaluate applications.
The event should:
(a)provide unique programming capable of attracting new and repeat out of town visitors to
the region;
(b)help build Metro's reputation as a leading leisure/pleasure destination in North America
and create an urgency to visit;
(c)demonstrate direct economic benefits and support for jobs in accommodation, food and
beverage, transportation, retail, travel trade and tourism services;
(d)induce overnight travel in paid accommodation and increase the length of time that a
visitor spends in Metro;
(e)generate positive media exposure - creating greater awareness of Metro and further
enhance the community's image as a leisure destination;
(f)create opportunities for leveraging the event media coverage to assist in marketing Metro
as a good place to live and conduct business;
(g)create awareness of the value of tourism for local residents, businesses and governments,
leading to greater long term commitment and support for the industry by the community;
(h)serve not only the visitor market but impact positively on residents enjoyment of, and
pride in, their community;
(i)capitalize on opportunities to package the event with other local businesses;
(j)provide opportunities for complementary programming throughout Metro, thereby
enhancing the benefits of tourism across the region;
(k)demonstrate international appeal; and
(l)not be available in nearby markets.
Preference will be given to events lasting more than one (1) month in duration.
Out of town marketing plans will be evaluated in cooperation with the MTCVA management
and reviewed for completeness and adequate budget allocation.
Administrative Capability and Financial Management:
(1)proven track record of management team, Board of Directors and/or Advisory Boards to
fundraise and produce similar events;
(2)feasibility of budgets and business plans;
(3)financial resources to repay Metro's loan; and
(4)demonstrated commitment of revenues from other public and private sources
Approvals:
Each proposal will be evaluated by the Economic Development Division and submitted to
Metro Council for Consideration. Legal and financial matters will be acceptable to the Metro
Solicitor and the Metro Treasurer.
1Terms of Reference based upon By-Law No. 107-95 of the Municipality of Metropolitan
Toronto by authority of Financial Priorities Committee Report No. 6(4) February 22-24, 1995
and Financial Priorities Committee Report No. 12 July 5, 1995.
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Appendix Two
Differentiation between Conventions and Major Events
|
Convention |
Event |
Market character |
Convention/conferences/
congresses
Independent, business
travellers
Closed to local resident
participation |
Leisure market
Family market
Encourages local resident
participation |
Media appeal |
Business media |
Travel media |
Community Image |
Linkage to business
development, target sectors |
Creates urgency to visit
Creates image as tourism
destination |
Duration |
Typically 3 - 5 days |
1+ month |
Linkages |
Linkages to academic,
business community |
Linkages to local attractions
and hotels through
packaging |
Location |
Convention/ trade centre |
Public attractions |
Hosting |
Hosted by local bid
committee |
Organized by public
organizations |
Funding mechanism |
No program exists now
Tourism Toronto had a
Convention Development
Fund which has been
terminated |
Former Metro Tourism
Event Development Loan
Program. |
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The Economic Development Committee reports, for the information of Council, also having
had before it during consideration of the foregoing matter the following communications:
-(August 31, 1998), addressed to Councillor Ashton, from Mr. Andrew M. Pringle, President,
Canadian Foundation for AIDS Research (CANFAR), expressing CANFAR's support of Dr.
Mark A. Wainberg's proposal to have Toronto chosen as the city to host the International
Conference on AIDS in the year 2004; and
-(September 17, 1998) from The Honourable Alan Rock, Minister of Health, expressing
support of the City of Toronto's application to host the 2004 World AIDS Conference.
Dr. Mark Wainberg, President, McGill AIDS Centre, Jewish General Hospital, introduced
various community representatives.
The following persons appeared before the Economic Development Committee in connection
with the foregoing matter:
-Mr. Ron Rosedale, Member, AIDS Committee of Toronto;
-Ms. Louise Binder, Chair, Voices of Positive Women;
-Ms. Bluma Appel, Chairperson, Canadian Foundation for AIDS Research (CANFAR).; and
-Dr. Sheela Basrur, Medical Officer of Health.