WEG loss at $1.9 million in 2008

The non-profit foundation that is putting on the 2010 Alltech FEI World Equestrian Games showed a financial loss of nearly $2 million in 2008, a deficit that organizers say is normal for an event such as WEG.

The group's 990 form, which is required by the IRS for most non-profit organizations, shows that in 2008, the World Games 2010 Foundation ended its fiscal year with $9.6 million in assets and $11.5 million in liabilities, for a loss of $1.9 million. The previous year, the loss was closer to $1.5 million.

"This is the normal financial evolution of an event of this magnitude," wrote Jamie Link, who became CEO of the organization in January, in an e-mail message. "As the foundation's activities must increase in order to prepare for the Games, expenses will naturally increase. Conversely, the bulk of revenues, especially ticket revenues, are realized closer to the event."

Expenses have risen from $3.2 million in 2007 to $4.4 million. About $1.5 million of that was used to pay salaries, including nearly $250,000 to then-CEO Jack Kelly.

The document also gives a first-time look at how much various sponsorships are worth to WEG and who their biggest contractors are.

The Games are being paid for with revenues from tickets, sponsorships, licensing fees and trade-show rental spaces.

Currently, Games officials won't discuss the budget, but, in previous months, they estimated that sponsorships would make up about $30 million of the $76 million operations budget, and ticket sales would make up another $30 million.

Organizers hope to sell about 600,000 tickets for the event, which will take place Sept. 25 to Oct. 10, 2010. Each person attending is likely to buy tickets to more than one event.

So far about 131,000 tickets have been sold.

Taxpayer money is not being used for the Games' operations, but the state has provided about $81 million to build an indoor arena and an outdoor stadium and provide extensive road upgrades at the Kentucky Horse Park.

The Games have also been hit hard by the global economic recession, and officials have said that sponsorships have taken longer and been harder to pin down.

The title sponsor, Nicholasville-based feed supplement company Alltech, has already paid $8.2 million of its $10 million pledge.

Alltech President Pearse Lyons said he thinks sponsorships are exactly where they need to be, but he is also planning on taking the first three months of 2010 to drum up more.

"With 304 days to go, we have some work to do," Lyons said. "That's why I'm fully committed, in the first three months of next year so I can devote time to making sure it's the single most incredible event in Kentucky."

Organizers have kept the details of other sponsorships under wraps, citing confidentiality agreements.

However, the 990 form shows some financial infusions from other major sponsors, such as Rolex, which gave the Games $500,000 in 2008.

Other contributions include: $350,000 from John Deere, $141,177 from Rood and Riddle Veterinary Hospital in Georgetown and $80,000 from Blue Grass Airport.

Organizers have said that many more sponsors are donating in-kind items needed by the Games, such as T-shirts for volunteers.

In recent months, officials say, sponsorships have been heating up, including a major backing from Meydan, a development group in Dubai.

"We are confident that we will achieve, even exceed, our sponsorship budget," Link said.

The 990 also lists contractors who have received more than $100,000. Those include:

Leroy Neiman, the famed sporting artist, who is being paid $240,000 to create the official art for the Games;

Digiknow of Cleveland was paid $160,099 for Web site development and maintenance;

WJ Sports and Events of Raleigh, N.C., was paid $137,562 for event coordination;

Red 7e of Louisville was paid $110,969 for marketing.

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