RSG Solutions

West Hollywood

The COVID-19 pandemic has been devastating to many families across the country, and the prolonged economic effects have resulted in the permanent closures of one in seven businesses across the country according to marketing platform Womply.  The pandemic has also caused events to be canceled during 2020, with some cancellations announced for 2021 as well. While local governments will experience lost tax revenues from business closures,  we also recognize the communities and organizations that benefit from large events for tourism are also experiencing significant negative impacts and are in need of support to remain sustainable.

Earlier this year, prior to the pandemic outbreak in the US, RSG completed a two-part financial study for the City of West Hollywood on the LA Pride Parade & Festival. The LA Pride Parade & Festival (“LA Pride”) is hosted annually in West Hollywood each summer and celebrates the LGBTQ community. The three-day event includes a parade, live concerts, and numerous vendors.  LA Pride is one of the largest such festivals in the United States and generates a significant economic impact in West Hollywood and the surrounding area. In 2019, LA Pride attracted roughly 250,000 attendees. 

Our study was focused on a review o the fiscal impacts report prepared on behalf of the nonprofit, as well as evaluating the overall fiscal condition of the nonprofit itself.  We found that the fiscal benefits for this type of an event coalesce around sales taxes collected and a limited amount of TOT revenues from out-of-town/multi-day visitors.  We also compared these revenues to costs borne by the City to provide services to LA Pride and found that the organization’s fiscal health and efficiency are improving.  We made several recommendations to assure transparency and oversight given the City’s long-standing relationship with LA Pride.