COTA Austin - construction and infrastructure

[FW17]

FY07


MSRTF


Championship Car World Series - 3rd Round (Grand Prix of Houston - 2007)


Houston


$1,782,000.00

When CART got money what was great achievement of getting it for F1?

[bhall]

Actually, having lived in Texas now for a few months, it wouldn't surprise me if the Texas government saw fit to pay for something in Kentucky. That's just how they roll 'round here.

Does F1 still qualify as a "major event" if it's just one of many similar events held every year at CotA?

EDIT: Naturally, this is assuming it happens at all.

[xpensive]

....
EDIT: Naturally, this is assuming it happens at all.

I doubt it.

[Hail22]

Actually, having lived in Texas now for a few months, it wouldn't surprise me if the Texas government saw fit to pay for something in Kentucky. That's just how they roll 'round here.

Does F1 still qualify as a "major event" if it's just one of many similar events held every year at CotA?

EDIT: Naturally, this is assuming it happens at all.

I fear that 2012 will be an F1 apocolypse year, Valencia rumoured they may not be able to afford future Grand Prixs, Austin is shakey with legal battles and also payments/funding for construction.

Melbourne is being threatened to make a night race (when Australia is one of the few Western Nations positive on the balance sheets in terms of growth).

Concorde Agreement at the end of the year with the typical Ferrari saga where they will threaten to leave if V8's don't remain in the series in the future.

In a nut shell...i feel/fear this event won't take flight maybe New Jersey GP...but Austin is founded on a bad foundation of Ethos...

[WhiteBlue]

MSRTF
Championship Car World Series - 3rd Round (Grand Prix of Houston - 2007) Houston
$1,782,000.00
When CART got money what was great achievement of getting it for F1?

$1.8m MSRTF is a trifle compared to the METF deal Hellmund put together. This is less than half the tax money Travis county alone has in one F1 event!

[Pup]

It's hilarious that you're still referring to this "deal" that Tavo put together, which consisted entirely of a meaningless (possibly fraudulent?) letter of support that apparently had no value whatsoever.

Somehow, this scrap of waste paper is supposed to be worth $250 million?

Puh. Leez.

I've even been generous in crediting Tavo with getting F1 on the events list. You guys act like the events fund had never been used for a race before. I mean jeez, the fund has been used for everything from a sales meeting for Dish Network to an Alcoholics Anonymous convention (and multiple races) - the funds obviously aren't that hard to get.

And yet, this scrap is Tavo's crown achievement?

So why aren't we asking how much of the rest of the deal hinged on this supposed commitment letter from Combs? Would Bernie have made the deal? Would McCombs have gotten involved?

[WhiteBlue]

Without the state sponsoring the tax money for multiple years an F1 race with a purpose build facility like the one in Austin is simply not viable in the USA. The history of the USGP at the IMS has shown that. Without substantial state sponsorship or sponsorship of similar magnitude from other sources no USGP promoter can afford FOM's race fees. The market is simply not there to pay the race fees by ticket sales only. Epstein will simply rip off Tavo's business model and try to get whatever METF money he can get. It will definitely be less than previously budgeted. We just have to wait and see. There is no point in speculating. At the end of the year we will know and then we can review what COTA managed to rise in tax sponsorship. I suggest we defer the further discussion until then. There is no point to further exchange opinions about the value or the solidity of Hellmunds deal with the METF. Everybody can read it.

[hairy_scotsman]

It's hilarious that you're still referring to this "deal" that Tavo put together, which consisted entirely of a meaningless (possibly fraudulent?) letter of support that apparently had no value whatsoever.

Somehow, this scrap of waste paper is supposed to be worth $250 million?

Puh. Leez.

It's simple. Without Hellmund's efforts, the USGP isn't even eligible for METF funding.

I've even been generous in crediting Tavo with getting F1 on the events list. You guys act like the events fund had never been used for a race before. I mean jeez, the fund has been used for everything from a sales meeting for Dish Network to an Alcoholics Anonymous convention (and multiple races) - the funds obviously aren't that hard to get.

It hadn't. Not that fund. Not the Major Events Trust Fund. The other motor sports events tapped into the ETF and the MSRTF. Using the METF was the only way to get the big bucks they were looking for.

The METF hasn't been used for events like the ones you mentioned.

[xpensive]

Without the state sponsoring the tax money for multiple years an F1 race with a purpose build facility like the one in Austin is simply not viable in the USA.
...

That is a sad state of affairs, but I wonder how much of this "state sponsoring" Austin will need every year then?

Perhaps that's the 25 MUSD mentioned earlier, but how did Hellmund and/or Cota arrive at that specific number?

[WhiteBlue]

... wonder how much of this "state sponsoring" Austin will need every year then?

Perhaps that's the 25 MUSD mentioned earlier, but how did Hellmund and/or Cota arrive at that specific number?

It is the state tax rate times the economic impact of the race. In the COTA case you have to take out the taxes of Travis county. They made it a condition of the licensing process that COTA would pay them their taxes back, which was agreed.

It is indeed a sorry state that the tax payer has to support the races. But the amount is by no means staggering. Melburne has an annual deficit exceeding $50m, which the Victorian tax payer has to bear. But we live in a market economy and many states gladly pay the prices Bernie has been asking to get a GP. Next year we will have Russia join the club and I'm pretty sure the race ticket sales in Sochi are not going to generate the race fee nearly. Putin will shell out most of this from the tax payers coffers.

[xpensive]

... wonder how much of this "state sponsoring" Austin will need every year then?

Perhaps that's the 25 MUSD mentioned earlier, but how did Hellmund and/or Cota arrive at that specific number?

It is the state tax rate times the economic impact of the race. In the COTA case you have to take out the taxes of Travis county. They made it a condition of the licensing process that COTA would pay them their taxes back, which was agreed.
...

And this amounts to xactly 25 MUSD?

[WhiteBlue]

yep, those were the projections. Tax if I remember right is 6.5%. It is somewhere here in this thread. We have already talked about it.

Edit: viewtopic.php?p=191181#p191181

Tax is 8.25% and economic impact was estimated at $300m. The figures are based on a report by Christian Sylt who is close to Ecclestone. He may have them first hand.

[hairy_scotsman]

... wonder how much of this "state sponsoring" Austin will need every year then?

Perhaps that's the 25 MUSD mentioned earlier, but how did Hellmund and/or Cota arrive at that specific number?

It is the state tax rate times the economic impact of the race. In the COTA case you have to take out the taxes of Travis county. They made it a condition of the licensing process that COTA would pay them their taxes back, which was agreed.
...

And this amounts to xactly 25 MUSD?

It's an upper limit. The comptroller was very confident, based on her research and on what she had heard & seen herself, that the tax revenues from the race would easily meet or exceed that amount. The "investor problem" and the NJ race announcement made her less confident of that, so she exercised her legal discretion and pulled the advance payment. COTA is still eligible to apply for METF reimbursement after the race (the usual procedure), and they could still get $25M x however many USGPs they hold at COTA.

[WhiteBlue]

The projected economic impact assumes that the average visitor of the 120,000 race crowd spends $2,500 for food, accommodation, transportation, shopping and entertainment in Texas. This sounds relatively reasonable.

[bhall]

Without the state sponsoring the tax money for multiple years an F1 race with a purpose build facility like the one in Austin is simply not viable in the USA. The history of the USGP at the IMS has shown that. Without substantial state sponsorship or sponsorship of similar magnitude from other sources no USGP promoter can afford FOM's race fees. The market is simply not there to pay the race fees by ticket sales only.

That's simply not true. The USGP was always the most-attended grand prix of the year. Always. This fact is somehow consistently lost on people during discussions about the American F1 market.

It was not discontinued due to a lack of funds. Ecclestone just thought FOM was the only entity that should profit from the USGP, so when the time came to negotiate a new contract, he jacked up the fee accordingly. And much to his credit, Tony George then said, in effect, "...and the horse you rode in on." The F1 landscape would look a lot different if more promoters had similar stones.

The projected economic impact assumes that the average visitor of the 120,000 race crowd spends $2,500 for food, accommodation, transportation, shopping and entertainment in Texas. This sounds relatively reasonable.

I don't think reasonable means what you think it means.