Contract extension sought for Long Beach GP
Although the city's contract with GPALB won't expire until June 20, 2010, the proposed agreement sought to stretch the termination date to June 30, 2015, with the optional extension to 2020.
"There really isn't a compelling reason to act this Tuesday," said Michael Conway, director of public works. "We thought it in the best interest of the city to let this item roll on for at least a week and find out what will happen in the industry."
GPALB is a separately held company that is co-owned by Kevin Kalkhoven and Gerald Forsythe – who also own the Champ Car World Series LLC, said GPALB president and CEO Jim Michaelian.
"We contract with Champ Car to bring the race here," Michaelian said. "Whatever transpires with regard to Champ Car has no legal ramifications (for GPALB)."
The industry's woes and Tuesday's would-be consideration of the GPALB's proposed contract extension was a coincidence, Michaelian said, adding that the contract had been in the works as far back as nine months ago.
Some of those details included prolonging the race period from three to three-and-a-half days, the possibility of reducing or eliminating admission for Thursday events, and GPALB agreement to reimburse the city up to $519,558 for the event.
Planning for this year's Toyota Grand Prix of Long Beach will not be affected, Michaelian said.
"While we are disappointed that the extension of the Grand Prix Association of Long Beach, LLC contract has been pulled from Tuesday's City Council agenda, we understand the City's concerns with regards to the current situation in open-wheel racing in America," Michaelian said in a statement released Tuesday night. "We are hopeful that those issues will come to a swift resolution and we will be able to go forward with a contract extension." Long Beach Press Telegram
02/09/08 On Tuesday the Long Beach, CA City Council will consider extending Long Beach's agreement with the Grand Prix Association that is set to end in 2010. The proposal calls for extending the agreement to 2015, with an optional extension to 2020 with council approval, according to a city report.
Michael Conway, the city's public works director, said that the city has traditionally offered the association 10-year extensions.
"But because there's so much development going on along the waterfront in downtown Long Beach, we were uncomfortable with a 10-year extension without being able to look at this in a shorter period of time," he said.
The Grand Prix Association had asked the city for the contract extension to get a jump on future races.
"We've had a great partnership with the city for the last 33 years and we are looking forward to extending that relationship into the future," Michaelian said. "And it's also very important for us as we have conversations with sponsors and with television and other entities, to be able to schedule out well into the future.
"And that's one of the reasons why we're talking to the city about extending our contract at this time, so that we would be in a position whereby we can commit the company and begin to formulate plans that extend beyond 2010," he said.
The new agreement also includes several other changes clarifying the type of race that can take place in Long Beach, allowing an extra half-day of free events, and requiring the Grand Prix to pay about $100,000 more to the city in expense reimbursements than it has in the past, the report says.
The races normally take place on a Friday, Saturday and Sunday. In recent years, a Thursday evening event has also been added along Pine Avenue.
The new agreement calls for future Thursday afternoon events offered free or at reduced prices, Conway said.
"That Thursday afternoon event is meant to be embracing of the entire city, not the downtown area, to allow school kids and others to come down and enjoy the race free of charge," he said.
The impacts of the Thursday event will be reviewed by the city and area businesses after 2009 to determine whether it will continue, the city report says.
According to the report, the new agreement also opens up the Grand Prix to Champ Car, Indy Racing League and other officially sanctioned racing series, but says that if the Grand Prix Association "fails to conduct an annual quality race" approved and certified by certain racing entities, the city can terminate the agreement.
The race would cost the association about $100,000 more this year under the agreement because of increased costs for permitting and administration fees, Conway said. The association would have to pay $519,558 to reimburse the city for the costs.
Long Beach also could make some extra money from future races under another new provision of the agreement that would give the city 15 percent of any sponsorship package that the city presents or refers to the Grand Prix Association.