Let's assume your basic fitness is at least passable, but if it ain't, then it's all over rover- for now at least. Your test requires 8 minute miles, which isn't all that quick really.
Strategy is your best friend here. If you do the test with others, find someone who should make the time, but not by much. Then run as close to him as you can and just dig deep.
If you're not sure that you'll get a 'pacer', then measure out a quarter mile route and how fast you need to do it to run fast enough (you could use the Endomondo app). A track would be better. Run at the required speed, followed by a very long walk break until you're breathing is somewhere near normal, then repeat. Stop the repeats before you're blasted.
Remember, all you want to achieve here is to know what the MINIMUM pace feels like, so you can replicate it on the day.
On the day of the test, don't go fast off the start. Build comfortably for the first 1/2 mile, push a bit on the second and give it your all in the last 1/2. Don't run this hard before the test, or you'll be wiped out and won't be able to produce your best on the day.
How about a tick list, so the entrant can choose what they want? My wife would pay a premium for a shirt, personalised medal, loads of gels/ chocs, etc. I would rather just pay less.
A post race money off voucher for a local restaurant would be popular, but only if people knew about it ahead of time, but then again, you'd want them to know wouldn't you. As an example, how about a fish & chip meal with drink for a fiver? Just set up the deal with the local chippy. If not, then the local pub would probably do a deal with you.
It's not a memento, but things like bouncy castles for kids go down well as a fun thing to provide. Or indeed, a kids race.
You could let the entrants pick their number, which would encourage early entry.