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Pay of top Knoxville Tourism and Sports Corporation executive Gloria Ray raises questions

8:20 PM, Jan 6, 2012   |    comments
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As 10News reported earlier this week, the Knox County Commission is set to discuss selling the Women's Basketball Hall of Fame. Knox County Mayor Tim Burchett said the money from the sale could be used to help pay for the new Carter Elementary School. One interested buyer has already stepped forward - the Knoxville Tourism and Sports Corporation (KTSC).

President and CEO, Gloria Ray tells 10News the group could put up to $6 million toward the purchase. It plans to submit a proposal if the county decides to sell.

Given the non-profit's ability to amass that much cash led 10News to some deeper questions about KTSC's budget and how it serves the greater Knoxville area. KTSC was established a decade ago after merging three sports and tourism-related organizations. The goal was to save money and maximize resources. So, 10News looked at its IRS documents to find out if that's the case.

"We'll come up with different promotions with different services that we will provide and it's proven to be successful," Ray said.

Ray helped bring together the Greater Knoxville Sports Corporation, the Knox County Tourist Commission, and the Knoxville Convention and Visitors Bureau back in 2002.

"Some of the car shows, they've been here forever. 27 years. 30 years. This is their home," Ray said.

It's mission is to promote Knoxville to tourist groups outside of the area, aiming to boost the local economy. KTSC is behind Boomsday, the nation's largest Labor Day fireworks show. It also recruits large-scale conventions, such as the American Quilter's Society, along with other events like Destination Imagination. To add to the list, KTSC also manages the Women's Basketball Hall of Fame.

"Except for one year, it has made a bit of profit, and that profit is paid to Knox County," Ray said.

People who stay in Knox County hotels help fund KTSC by paying a local hotel/motel tax.

The organization gets a portion of that tax from the city and the county, which makes up the majority of its budget.

"The citizens do not fund the KTSC. There's no sales tax or wheel tax or property tax. It's strictly the money that's collected from the visitors that stay in our hotels," Ray said.

Other revenue comes from things like retail sales and advertising. KTSC spends its money to market itself and the city.

"We have very talented staff here and they're able to create a lot of our media and so we can spend more on placement and spend more on targeting it," Ray said.

Since KTSC is a non-profit, it doesn't pay taxes. But it still has to file a 990 form with the IRS. 10News took a look at those forms to see how the organization spends money.

According to the most recent 990 form from 2009, 37 percent or $1,432,150 of its revenue goes toward "other expenses." That's everything from ads and event costs, to overhead items like office expenses and accounting. But, 60 percent or $2,312,523 of its revenue goes directly toward employee salaries and benefits for its 59 employees.

One number that stands out is Ray's compensation. In the 2010 fiscal year, she made $405,583, accounting for nearly 18 percent of KTSC's salary expenses.

Here's how Ray's pay breaks down: Her base pay was $206,040, she got a bonus of $171,396, and benefits and other pay add up to $28,147.

We asked Ray if her salary is fair. "We feel comfortable with it. We certainly hope that the numbers that we have been able to produce will, in fact, reflect that," she said.

For some perspective, Ray makes more than the top appointed official (Dale Smith, Knox Co. Public Building Authority, $186.313), the top elected official (Knox County Mayor Tim Burchett, $156,793), and the top school district employee in Knox County (Dr. Jim McIntyre, $220,800).

"I've said often that I make too much money. My salary is set by the legislature. I'm supposed to be the highest paid official in Knox County. That's the law. But $405,000 is a whole heck of a lot of money under any economy, especially now," said Knox County Mayor Tim Burchett.

10News also looked at salary expenses for similar organization in Nashville and Chattanooga. According to the 2009 IRS 990 Form, the top executive at the Nashville Convention and Visitors Bureau (CVB) made $403,743, while the top executive at the Chattanooga CVB made $136,890.

It's important to note the Nashville and Chattanooga CVB's both brought in more revenue, $14,553,099 and $5,990,194 respectively.

The Nashville CVB spent 34 percent of its revenue on all salaries and benefits, while the Chattanooga CVB spent 27 percent. That's compared with KTSC's 60 percent. Of the money spent on salaries, both the Nashville and Chattanooga CVBs spent about eight percent on their top executive, while KTSC spent close to 18 percent.

Ray's pay is now raising eyebrows among some in the community.

"It seems a little steep for me, especially in these economic times. I haven't seen any big name things come in here. We used to get bowling tournaments, used to come in here, but I haven't seen anything major come in and we've got a convention center that we're paying dearly for," said Knox County Commissioner Jeff Ownby.

Some of KTSC's biggest gets have left Knoxville in recent years: the Honda Hoot and the quilter's convention.

"The quilters...don't be surprised if they're back. There's a rotation almost," said Ray.

Still, Ray feels KTSC is fulfilling its mission in Knoxville.

Ray said the money KTSC has saved up to put toward the Hall of Fame comes from corporate support and gifts.

The County Commission will take up the possible sale of the Hall of Fame on January 17.

 

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