Austin MotoGP race to generate $25 million in economic impact, study says
A MotoGP race scheduled for April 19-21 at Circuit of the Americas is expected to generate about $25 million for the Austin area, according to a study submitted to the state as part of an application for incentives.
The study and application were filed Dec. 19 by the Circuit Events Local Organizing Committee, a nonprofit affiliated with owners of the 3.4-mile racetrack, which was recently annexed into far Southeast Austin.
Circuit organizers are seeking money from the Texas Event Trust Fund for reimbursement of state sales, alcohol, hotel and motel, and car rental taxes that the race will generate.
Austin City Council members voted 5-2 on Dec. 13, in effect, to sponsor the circuit’s application for money from the fund, which is controlled by state Comptroller Susan Combs’ office. City, circuit and local organizing committee officials signed agreements about a week later.
The application seeks about $2.2 million, of which $1.9 million would come from the state tax revenue generated by the three-day event and about $300,000 from a local entity. Normally the local money would come from Austin, but Circuit of the Americas organizers have agreed to pay the local share.
The application also includes a Dec. 18 letter from City Manager Marc Ott to Combs in support of the application.
The comptroller’s office will create its own estimate of the incremental tax increase generated by the event to establish a trust fund, based in part on the study submitted with the application. State law requires that the fund be established within 30 days of receiving the application.
MotoGP is motorcycling’s equivalent of auto racing’s Formula One. It’s the pinnacle of the sport and will have two other stops in the United States in 2013: Indianapolis and Laguna Seca in California.
At each location, the three-day event might draw 130,000 to 140,000 fans, with upwards of 60,000 for a Sunday race, officials have said.
The Austin study says that about 86,000 people will attend race day April 21, a Sunday, with a total attendance over three days of 161,000. Those figures are based on attendance at Laguna Seca and Indianapolis for the past three years and a “novelty effect” for a first-year event, the study says.
About 55 percent of attendees are expected to come from out of state, according to the study.
Circuit spokeswoman Julie Loignon would not say how many tickets have been sold or from where people are buying them. Most of the U.S. sales have come from Texas, she said, and the majority of international sales have been from Mexico, Canada and Great Britain.
The study considered how much fans, team personnel and drivers, media, sponsors and others will spend on hotel rooms, food and drinks, car rentals, and shopping and entertainment in Central Texas. It says up to 9,700 hotel rooms will be needed for the race, about a third of the city’s 30,000 rooms.
Most of the money spent — about 80 percent — would stay in Austin, the study says.
The study was done by Don Hoyte, a former economist for the comptroller’s office.
Circuit of the Americas is seeking up to $5 million from the Texas Event Trust Fund for four motorsports events this year: April’s MotoGP race, V8 Supercars in May and the American Le Mans Series and World Endurance Championships in September.
The agreements and applications for the other races have not been finalized. State law requires such applications for money from the event fund to be filed at least four months before the event.
The MotoGP agreements mirror those for November’s inaugural Formula One race. Combs in December approved paying $29.3 million to the circuit from the Major Events Trust Fund, a similar state economic development fund used to attract events such as Super Bowls and NCAA basketball Final Four tournaments.
That money was used to reimburse the circuit for a sanctioning fee to Formula One Management, the England-based organizer of the international race series, and for other expenses related to the race. The Statesman