Why Austin won the USGP - Money
A day after the sudden announcement that one of the world’s highest-profile sporting event is heading to Austin, more details are emerging, including a $25 million-per-year state government incentive offer (over 10 years = $250M - When in doubt, follow the money).
On Tuesday, Formula One World Championship Ltd., Formula One Administration Ltd. and Austin-based promoter Full Throttle Productions LP announced the Formula 1 United States Grand Prix will be held in Austin from 2012 to 2021.
Promoters, who want to build a track specifically for the race for the first time in its history, did not specify a location and offered few other details. But the Associated Press reported Full Throttle saying the property will be more than 700 acres. The company also reportedly brought on German firm Tilke GmbH to design the venue. Tilke has built racetracks in Abu Dhabi, Bahrain, Shanghai and Istanbul among other cities.
On April 7, the state governor’s and comptroller’s offices sent a letter to Formula 1 top executive Bernard Ecclestone saying the state would pledge funds over a 10-year term, which could be terminated if Full Throttle fails to secure the race.
After the first year of the agreement, the state also opened the door to provide more money from “any legally permitted sources,” according to records obtained by the Austin Business Journal.
A state spokesman said Wednesday that no deal had been finalized, and he did not know when it would happen. Officials said state Comptroller Susan Combs spearheaded the project at the state level. The comptroller is the chief steward for state’s finances, acting as tax collector, chief accountant, chief revenue estimator and chief treasurer for all of state government.
“We gave them a quote for the press release, but beyond that the comptroller’s office handled it,” Gov. Rick Perry’s spokeswoman said.
State spokesman Allen Spelce said while the announcement caught government officials off guard, the comptroller’s office has been working on the deal for about a year, and met several months ago with Austin Mayor Lee Leffingwell and his staff.
The mayor’s spokesman said Leffingwell hosted a meeting at city hall with state and racing representatives last month. Leffingwell knew about the pending announcement last week, but did not know the exact day the Formula 1 headquarters would announce it.
While no location for a track has been announced, it will most likely be within the Austin city limits, the spokesman said.
A Formula 1-style race track in India cost more than $300 million, according to reports. Austin Business Journal