Circuit of the Americas Development Updates

[GoldenBoot]

Originally Posted by turn1

As for the resounding success, it's all relative. It didn't sell out. It was a blip compared to the 1st 2 years at Indy...

Hey "Tavo"...Indy has the highest permanent seating capacity of any sporting venue in the world (257,325). COTA's permanent seating capacity is roughly 3.5% of that number. Temp. seats have to be erected to even approach 47% of Indy's permanent seating capacity.

Furthermore, Indy has 104 years of racing history. Austin/COTA has what, 6 months!?! One must prove themselves to become successful. COTA has not had the time to do so.

I'm rather pleased at their (COTA & Austin's) first-year F1 "success." However, I do think COTA over estimated the success of the other first-year races on their calendar. Hopefully, year #2 will be more successful.

[electricron]

I suppose anytime a city collects more money than it spends it should be considered a success. From the report....
http://www.austintexas.gov/sites/def...-_5-08-13_.pdf
City Sales Tax Revenues
Nov 2010 $11,005,739 Nov 2011 $11,688,179 Nov 2012 $12,546,565.
Off hand, it looks like the F1 race event added $858,386 to the city's revenues. But I would like to point out that the city collected $682,440 more in 2011 than 2010, just from the normal growth of the economy from year to year. Therefore, the F1 race should be credited for adding $175,946 to the city's bank account over and beyond normal growth from sales taxes.

The city also collects other taxes we should account for as well.

Hotel Occupancy Tax (4th Quarter)
2010 $10,895,231 2011 $11,532,389 2012 $15,027,303
After doing all the math as before, the F1 race can be credited for adding $2,857,756

Mixed Beverage Tax (4th Quarter)
2010 $1,500,169 2011 $1,298,811 2012 $1,434,069
Note that 2012 revenues doesn't equal 2010 revenues, although it is $135,258 more in 2012 than 2011. Can anyone explain why 2011 was less than 2010?

Car Rental Tax (4th Quarter)
2010 $ 1,565,940 2011 $1,616,485 2012 $1,974,349
After doing all the math as before, the F1 race can be credited for adding $307,319

Summing up all the different tax revenue gains, F1 race can be credited for raising the city's revenues $3,476,279 - most of it coming from the Hotel Occupancy Tax.

Per the report, the city spent an additional $890,880 to support the F1 race weekend, most of it, to be exact $585,554, in overtime pay for various city workers. The report doesn't list any capital costs associated with expanding or paving of any roads, laying water and sewer pipes, nor any amount of property tax collected or incentives granted.

If it had, how much of the $2,585,399 net gains would be left?

[hookem]

Upcoming V8 Supercars race in Austin could have a worldwide TV audience of 100 million people --
http://www.perthnow.com.au/sport/mot...-1226639973131

Ricky Williams, Cedric Benson to appear in promos featuring the V8 supercars and Austin areas like 6th street, the capital, DKR stadium (will be aired during the event):
http://www.statesman.com/news/sports...d-power/nXpFt/

If anyone is interested, it will be televised here on Speed at 3pm Sunday May 19.

[turn1]

Originally Posted by East7thStreet

Do you have a personal relationship with the owners of the track? You have a decidedly anti-track perspective that makes it seem that they have done something to you personally.

Nope. I know a lot of good folks who work out at the track. No anti-track perspective here. Nobody has been more excited to have this facility here than I have. I've been to every race & will be out there for V8s, too (will take lots of photos & post them as soon as I can). But I won't ignore valid issues surrounding the track & its operation. It's funny how reporting both sides of things is viewed by some as a pro-track bias and by others as an anti-track bias.

The post you responded to is based in fact, not opinion.

[turn1]

Originally Posted by GoldenBoot

Hey "Tavo"...Indy has the highest permanent seating capacity of any sporting venue in the world (257,325). COTA's permanent seating capacity is roughly 3.5% of that number. Temp. seats have to be erected to even approach 47% of Indy's permanent seating capacity.

Furthermore, Indy has 104 years of racing history. Austin/COTA has what, 6 months!?! One must prove themselves to become successful. COTA has not had the time to do so.

I'm rather pleased at their (COTA & Austin's) first-year F1 "success." However, I do think COTA over estimated the success of the other first-year races on their calendar. Hopefully, year #2 will be more successful.

Err...not Tavo...but I'm not sure what I said that you're arguing against here.

I said they didn't sell out. They didn't, despite the venue being smaller than Indy's. Indy can hold 400K+ (with GA) & pulls crowds in that ballpark. COTA could accommodate 200K with GA & pulled 117K. COTA's seated capacity is not 47% of Indy's seated capacity, and the 120K is not the true capacity. Different COTA reps have said variously over the last 2 or so years that it will hold 200K+, 160K, 140K, and 120K. They also reduced the size of the T1 GS by a few sections because of slow sales there. Even with the stands mostly full during F1 and 40K in GA areas, there were massive areas with few people and lots of room for more.

[turn1]

Originally Posted by hookem

Upcoming V8 Supercars race in Austin could have a worldwide TV audience of 100 million people --
http://www.perthnow.com.au/sport/mot...-1226639973131

Ricky Williams, Cedric Benson to appear in promos featuring the V8 supercars and Austin areas like 6th street, the capital, DKR stadium (will be aired during the event):
http://www.statesman.com/news/sports...d-power/nXpFt/

My worlds have collided! Mind. Blown!

I had some extensive back and forth with turn1 on other racing forums during the run-up to the first race. I think it's fair to say he doesn't like COTA management, but isn't anti-track or anything. He is also probably one of the 2 most knowledgeable people regarding what is going on at COTA (that are actually accessible on the internet).

I think the numbers for the first F1 race were pretty amazing, maybe not in comparison with TMS/Nascar or F1 at Indy... but considering how uncertain things seemed until the very last minute, it was an unqualified success IMO.

This year may answer a lot of questions. Will people come back? Will there be new attendees who hesitated last year because of traffic or the track being ready concerns? Will hotels be cheaper (because maybe they won't be blocked out by COTA this time, but they may jack up prices because of the UT game demand)?

I'm definitely going again this year. And I would recommend it to anyone.

Thanks for the nice comments! BTW, are you the other one?

I think they'll lose some people & gain some. What will be interesting is to see how many of each. Even big F1 fans don't tend to go to the same races each year unless they're close by.

[turn1]

Originally Posted by Jdawgboy

Actually despite what turn1 says, the track may have not sold out for F1 but it was pretty damn close. Capacity was capped at 120K and they had around 117K

I never stated otherwise.

"Close" is not a sellout. Geoff Moore said a couple of months ago it was a sellout. The only tickets that sold out were GA, because they were capped at 40K in an effort to redirect buyers to unsold GS tickets.

As you say, capacity was indeed "capped". 2 or 3 months before the race, they were saying capacity was 140K. Then as the race drew nearer, that suddenly changed to 120K.

[turn1]

Originally Posted by Novacek

They didn't take all the revenue. That's just it. The county is still getting lots of money from the track. Maybe it should use some of it to fulfill its obligations (maintaining roads and such).

OK, so the county gets a bit over $800K. How much did it spend? How much tax revenue did the city take from them when they took COTA? How much are TCSO, ATC-EMS, and ESD 11 spending to cover events at COTA? Those road improvements the city wants...how much would they cost the county?

[turn1]

Originally Posted by alwaysmiling

Looked every bit of sold out on tv and the crowds for Friday and Saturday were impressive too...It was the biggest single day attendance for a sporting event in Austin or am I forgetting something?

The Friday & Saturday crowds were indeed impressive. The Sunday crowd was very good, but no permanent GS sold out & big unoccupied areas were visible in a couple of them during the race. It was indeed the biggest crowd in Austin sports history.

There was nothing wrong with the crowd itself. That's not the point. The crazy projections & number games are the real problem. No race there yet has met COTA's projections.

[turn1]

Originally Posted by electricron

I suppose anytime a city collects more money than it spends it should be considered a success. From the report....
http://www.austintexas.gov/sites/def...-_5-08-13_.pdf
City Sales Tax Revenues
Nov 2010 $11,005,739 Nov 2011 $11,688,179 Nov 2012 $12,546,565.
Off hand, it looks like the F1 race event added $858,386 to the city's revenues. But I would like to point out that the city collected $682,440 more in 2011 than 2010, just from the normal growth of the economy from year to year. Therefore, the F1 race should be credited for adding $175,946 to the city's bank account over and beyond normal growth from sales taxes.

The city also collects other taxes we should account for as well.

Hotel Occupancy Tax (4th Quarter)
2010 $10,895,231 2011 $11,532,389 2012 $15,027,303
After doing all the math as before, the F1 race can be credited for adding $2,857,756

Mixed Beverage Tax (4th Quarter)
2010 $1,500,169 2011 $1,298,811 2012 $1,434,069
Note that 2012 revenues doesn't equal 2010 revenues, although it is $135,258 more in 2012 than 2011. Can anyone explain why 2011 was less than 2010?

Car Rental Tax (4th Quarter)
2010 $ 1,565,940 2011 $1,616,485 2012 $1,974,349
After doing all the math as before, the F1 race can be credited for adding $307,319

Summing up all the different tax revenue gains, F1 race can be credited for raising the city's revenues $3,476,279 - most of it coming from the Hotel Occupancy Tax.

Per the report, the city spent an additional $890,880 to support the F1 race weekend, most of it, to be exact $585,554, in overtime pay for various city workers. The report doesn't list any capital costs associated with expanding or paving of any roads, laying water and sewer pipes, nor any amount of property tax collected or incentives granted.

If it had, how much of the $2,585,399 net gains would be left?

I don't think the city did any road improvements associated with the race. They are reimbursing (or may already have reimbursed) COTA for the huge water main installation. $13M, I think.

[JoninATX]

I can't wait for the V8 race!!!!

[Jdawgboy]

Originally Posted by turn1

I never stated otherwise.

"Close" is not a sellout. Geoff Moore said a couple of months ago it was a sellout. The only tickets that sold out were GA, because they were capped at 40K in an effort to redirect buyers to unsold GS tickets.

As you say, capacity was indeed "capped". 2 or 3 months before the race, they were saying capacity was 140K. Then as the race drew nearer, that suddenly changed to 120K.

From the very beginning, I heard on the news and reading articles the 120K number not 140K. Not sure where your getting that number but I've always heard them say a racetrack that would bring up to 120K.

Now we all know in reality that track can easily hold 200K plus and likely will one day but from the very start they used 120K as the capacity mostly due to the fact the area wouldn't be able to handle more than that with current road infrastructure. I could post up news links from a year before the race that they were using the 120K figure.

[Novacek]

Originally Posted by turn1

How much tax revenue did the city take from them when they took COTA?

About the same as they would have taken when the city would annex the subdivision that originally was going to go there. Or when they annex any area. That's how it works/how it's intended to work.

[hookem]

Originally Posted by turn1

Thanks for the nice comments! BTW, are you the other one?

Nah, I was thinking of your partner in crime on the Friends of Formula 1 Austin facebook page. But thanks.

[hookem]

Originally Posted by Novacek

About the same as they would have taken when the city would annex the subdivision that originally was going to go there. Or when they annex any area. That's how it works/how it's intended to work.

I think it might be more, actually. If the track ends up being valued at $300M, that's significantly more than the subdivision of 1200 cheap houses (1200 x $130K = $156 Million). Plus the homes would likely have a large percentage of homestead exemptions. The track has some land with ag exemptions, though... so I'm not sure what the net property tax gain is. But I suspect a lot more than the homes.

But the biggest prize is the sales tax revenue. 2% (Austin and Cap Metro) out of the 8.25% total... on easily 10s of millions in sales. That wouldn't happen with a subdivision.

[electricron]

Originally Posted by hookem

But the biggest prize is the sales tax revenue. 2% (Austin and Cap Metro) out of the 8.25% total... on easily 10s of millions in sales. That wouldn't happen with a subdivision.

I'm not sure how the property tax changed. But I did post the sales tax figures earlier, didn't you read it? Tens of millions was 175 thousand dollars. CapMetro and the city each get 1%, the State gets 6.25%. A grocery store located on the rim of any neighborhood probably could collect that much local sales tax over an entire year. Don't forget, most of the COTA tickets are sold over the internet, all of those sales to patrons outside of Texas aren't subject to Texas sales taxes. Hopefully Congress will pass that bill that will change the internet sales tax rules this year.

[hookem]

Originally Posted by electricron

I'm not sure how the property tax changed. But I did post the sales tax figures earlier, didn't you read it? Tens of millions was 175 thousand dollars. CapMetro and the city each get 1%, the State gets 6.25%. A grocery store located on the rim of any neighborhood probably could collect that much local sales tax over an entire year. Don't forget, most of the COTA tickets are sold over the internet, all of those sales to patrons outside of Texas aren't subject to Texas sales taxes. Hopefully Congress will pass that bill that will change the internet sales tax rules this year.

Different numbers. I said 10s of millions in sales at COTA, your numbers are sales tax revenue... which is the percentage the city gets. You don't think $12m was the total of all sales in Austin for November, do you? And $175K was just the incremental difference on the city's .01 cent take (I don't think they are including the cap metro part), attributable to F1 and only over a single month, not a whole year of events. I'm fairly certain that I am correct in guessing a years worth of taxable sales at COTA (tickets, parking, food/beverage, merchandising, 3rd party vendors, etc) exceeds $10m in a year. If not, COTA is in some serious trouble.

To be clear, I'm not saying the city makes 10s of millions. I'm saying they get to tax 10s of millions of revenue that they wouldn't be able to if it had turned into a subdivision. And $175K in a month, in terms of sales tax revenue, is a pretty big deal to the city -- just like the difference in $300M property tax valuation vs. $156M is big to the city. I mean, they only get .0052 of that per year but it is certainly significant.

Regarding ticket sales, I'm not sure of the sales tax deal. I know that both COTA and Ticketmaster have a presence in Texas, so you'd figure there would be sales tax at least on the tickets I buy locally, but there never is. I'm not sure why. Maybe someone else has more knowledge there.

[turn1]

Originally Posted by Jdawgboy

From the very beginning, I heard on the news and reading articles the 120K number not 140K. Not sure where your getting that number but I've always heard them say a racetrack that would bring up to 120K.

Now we all know in reality that track can easily hold 200K plus and likely will one day but from the very start they used 120K as the capacity mostly due to the fact the area wouldn't be able to handle more than that with current road infrastructure. I could post up news links from a year before the race that they were using the 120K figure.

One of dozens of articles referring to 140K...9/18/10: http://www.examiner.com/article/us-f...texas-revealed

The new facility will accommodate up to 140,000 spectators and it's estimated cost at this point is 220 million dollars.

From this very thread, 9/13/10: http://forum.skyscraperpage.com/show...&postcount=112


It was also talked about a lot in other forum threads over the 3 years, and the 140K figure was still being tossed around in news articles a month before the race.

10/22/12: http://www.autoweek.com/article/20121022/f1/121029971/

With around 140,000 people expected to show up for the race, getting in and out could take hours.

While nothing has changed out at the track, apparently Geoff Moore has even predicted 140K for this year's USGP: http://w11.zetaboards.com/Motorsport...8722&t=8590204

[turn1]

Originally Posted by JoninATX

I can't wait for the V8 race!!!!

Gonna be fun. Maybe the best racing yet out there.

[electricron]

Originally Posted by hookem

To be clear, I'm not saying the city makes 10s of millions. I'm saying they get to tax 10s of millions of revenue that they wouldn't be able to if it had turned into a subdivision. And $175K in a month, in terms of sales tax revenue, is a pretty big deal to the city -- just like the difference in $300M property tax valuation vs. $156M is big to the city. I mean, they only get .0052 of that per year but it is certainly significant.

The purse for just the F1 race at COTA is $25 Million. They better be taking in more than that if the track owners plan to make a profit. They collect a lot of money from advertisers - technically not subject to a sales tax..
If they had just $10 Million in sales, the city's 1% sales tax should have collected $100,000. Therefore, $175,000 sales tax revenues boost probably meant around $17.5 Million in sales.

That yearly $25 Million sanctioning fee going to F1 leaves Austin and the USA with most of the teams and their suppliers based in Europe. Call it a wash - just as much money comes in as goes out.