How much will the United States Grand Prix cost Texan taxpayers?

[Haltech]

Filed under: Motorsports, Government/Legal, Earnings/Financials



Love it or hate it, the Formula One circus is heading to Austin, Texas. The reinstated United States Grand Prix is set to take place in the Lone Star capital city starting in 2012 and the annual event will surely infuse an added boost of tourism revenue into the Austin area. But just how much will the initiative cost Texas taxpayers?

The first indication could be the licensing fee which Formula One Management chief Bernie Ecclestone charges race organizers for the right to hold the event and its inclusion in the championship. The fee varies for each venue, and nearly every grand prix is financially supported in some capacity by local governments eager to put their locations on the map. Austin's bill reportedly comes to $25 million for the first year, and will be passed on to local government for the first year at least. After that, the revenues from the previous year's race will go towards Ecclestone's fee for the following season.

Assuming Bernie applies the same 7% annual increase as he does to other venues, that means the race will need to generate $26.75 million in its first year to cover just the licensing fee for the following year. Considering that - with advertising, concessions and just about everything else going straight to Bernie's pockets and some to the teams - ticket sales remain as one of the few ways for race organizers to recuperate the costs.

[Source: Austin American-Statesman via F1 Fanatic | Image: Daniel Mayer CC2.0]How much will the United States Grand Prix cost Texan taxpayers? originally appeared on Autoblog on Thu, 03 Jun 2010 14:32:00 EST. Please see our terms for use of feeds.



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[neotide87]

I know to bring F1 to Indy (my town) it was expensive for the city but I honestly enjoy it more than the Indy 500. More frequent turns and more precision driving and I could be wrong but I think they go faster too. The last 3-5 years the viewership went down and made Indy a hard place to keep that in the city.