For some time, there has been a lot of drama concerning a possible Formula One race in New Jersey in 2013, as the world’s premier race series wants to make an American Gran Prix a regular fixture. However, the proposed F1 New Jersey event might be canceled.
Contracts for F1 New Jersey reportedly shredded
For months, the rumor mill has been churning over a proposed Formula One race in New Jersey for the 2013 F1 season. Formula One isn’t the most popular motor sport in the United States, as NASCAR and IndyLights, the race series formerly known as IndyCar, enjoy more of a following.
However, there is a significant following in the U.S. Internationally, F1 is considered the most prestigious motor racing series in the world, which would make an F1 New Jersey event a big deal.
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An agreement has failed to materialize so far, for whatever reason. The race isn’t certain to happen and, according to AutoBlog, is likely not happening, as Formula One boss Bernie Ecclestone has disclosed that the contracts for the race were torn up.
Decade of races were scheduled
The F1 New Jersey contract was supposed to guarantee 10 Grands Prix in New Jersey and, therefore, the return of a regular United States Gran Prix to the sport. One is scheduled to take place later this year in Texas on Nov. 18, according to the Guardian, at the currently in-construction Circuit of the Americas.
There hasn’t been a United States Gran Prix since 2007, according to the Economist. There hasn’t been a fixed location for one after the U.S. GP ceased being run at Watkins Glen in New York, where it was held from 1961 to 1980.
Part of the issue is state governments are playing hardball. They should be. The money involved is huge – if one thinks motor finance is expensive for a car, try a race event – and second, shouldn’t tax dollars go to roads and schools before lining Bernie Fake Tan’s pockets?
Sport and loss leading
Sports are loss-leaders. Cities pay all or some for new sports stadiums for NFL teams, stuff for the Olympics, whatever with the idea being that increased tourism, jobs and subsequent tax revenue will pay for it and then some. It doesn’t always work; the 1976 Olympics, for instance, took the city of Montreal 30 years to pay off.
According to ESPN, 15 of the 19 F1 Grands Prix last year were, in some part, publicly financed. Formula One’s holding company, F1 Group, insists, naturally, that cities make generous returns, though they have to pay a lot. Firstly, Formula One demands a fee for staging the race, which can range, according to the Austin Statesman, from nothing, for Monaco, to $47 million, which F1 charged Malaysia last year.
Cities have to spend upward of $30 million to hold the race, blocking off roads, putting up grandstands and pit buildings for street courses, hiring security and sanitation and so forth, according to ESPN. Building permanent facilities can cost $250 million. However, many cities do manage to net profits on races, making F1 one of the few sports that isn’t a bad wager.
Also, according to the Economist, most United States Grands Prix, after Watkins Glen stopped running the races, lost money. That is why New Jersey governor Chris Christie insisted an F1 New Jersey race would have to be privately funded and also why the state of Texas isn’t staging any more races until after it’s added up the receipts from this year’s race.
Austin Statesman: http://www.statesman.com/news/news/special-reports/taking-a-closer-look-at-economic-benefits-claime-1/nRb83/