A planned American Le Mans Grand Prix race in Oklahoma City would require taxpayers to front $6.9 million for capital expenses that would partially be recovered through a $1.3 million annual fee paid by the promoters with the remainder coming from an anticipated increase in sales tax revenues.
A letter of intent with OKC Grand Prix LLC is set to be considered Tuesday by the Oklahoma City Council, and contrary to prior reports, Bricktown is being eliminated as a possible host for the race.
Brad Lund, chief operating officer of OKC Grand Prix LLC, predicts the race will be an economic bonanza for the city.
"It's not just a sporting event — it's an event," Lund said. "I've been told 15 percent of spectators will be there because of the car or the driver, the rest for the event as a whole. It has the potential to be among the highest attended sporting events in our state's history. We prefer to under-promise and over-deliver, so we're predicting 83,000 fans over three days. Industry insiders have expressed the number could easily exceed 100,000."
Lund, whose partner is Trent Ward, chief executive officer of OKC Grand Prix LLC, expects the race to be immediately profitable.
A city staff analysis paints a different picture.
City staff reports indicate the street course being proposed by OKC Grand Prix LLC has a "documented record of poor sustainability."
The report was prepared by the city's special projects manager Tom Anderson, who also engineered negotiations with the NBA's Hornets and Thunder. He warns industry experts advised him the race will lose money for "several years" before it's a success.
"American Le Mans historically is most successful on dedicated race tracks," Anderson wrote in his report. "Temporary street courses demonstrate poor longevity. Of the seven individual cities that have conducted American Le Mans temporary street course races, the average recurrence rate is 1.86 races."
Anderson indicated the only temporary street race in the 2010 American Le Mans series is in Long Beach, Calif., a community that started street races 36 years ago in what was originally a blighted shorefront area where development subsequently sprouted around the event.
Cities that started and halted American Le Mans street races this past decade include Miami, Washington, D.C., Quebec, Houston, Detroit and St. Petersburg, Fla.
When asked about the record of the street races, Lund responded he is not an expert on racing tracks. In an interview with The Oklahoman, Anderson said there are a variety of reasons why street-based American Le Mans races haven't succeeded in other cities.
"The economy sank the race in Detroit; D.C. had an issue with the promoter where they had a lot of complaints; in Houston they had it for two years but it had a poor track design, noise complaints, and it wasn't highly successful," Anderson said. "Miami is a unique example — they did it one year as a street race, then they moved it to a dedicated track facility."
Local race promoters organized a visit to Long Beach in April in which Anderson, former Bricktown Association Director Jim Cowan and a small group of business executives watched the 2010 American Le Mans race and visited with the town's merchants.
Anderson said Long Beach may not be the best reference for Oklahoma City.
"Long Beach started on the periphery of the city, along the coast, in a very blighted area," Anderson said. "And there has been a lot of development along there in the past 36 years it's been very successful."
In comparison, Anderson sees downtown Oklahoma City as an area already established with no history of racing on its streets.
"Obviously Long Beach has a long history of success," Anderson said. "I suspect they'll be there as long as they want to be. We will have to outperform the track record of street circuit races that, historically, in these other cities, didn't last."
Anderson said Lund and Ward need to be "looking long term" to be financially successful."
"Hopefully they've got their eye on the ball for long-term success of the race which is in line with our objective," Anderson said. "If everyone is looking long-term, then everyone comes out OK."
Ward said he is not worried about the failure rate of past street courses or the prospects for success locally.
"The series is moving in a new direction with street races," Ward said. "It's typically an endurance-based race. So historically, it's difficult to do an endurance race on street courses."
Ward said he is working with the series sponsors to de-emphasize endurance racing for the Oklahoma City race.
Ward added the proposed annual $1.3 million fees paid to the city go beyond any commitment made in other communities with street racing and will ensure the city recaptures its $6.9 million in 10 years.
Ward agreed with Lund the race will be successful the first year — and discounted any chance the event could be discontinued within a few years, leaving the city with an unpaid bill.
"You will have all of your hotels full, you will have people eating in restaurants," Ward said. "There is a risk and reward to any situation anyone enters into. I believe the reward side outweighs the risk side a lot.... Brad and I are both local guys. We want what's best for the city. We want to see the city grow. And we believe this is the next step in becoming a big league city."
Mayor Mick Cornett said he began envisioning a Grand Prix race for the city five years ago and introduced Ward to Lund after Ward expressed an interest in bringing racing to Oklahoma City.
Cornett acknowledged the investment won't be an easy sell in the current economy but added it represents a less expensive avenue to bring racing to the city in contrast to spending "hundreds of millions" on a permanent stadium.
"The risk needs to be addressed at city council on Tuesday," Cornett said. "The question is, what does it take to get these huge events? I have a lot of confidence in Trent and Brad. And I know the Ward family is as solid as it gets."
Race could affect Project 180
Bricktown was the original site targeted to host an American Le Mans Grand Prix when the proposal was first announced in March. That option was eliminated when consultants advised the railroad viaduct bridges at Main and Reno are too narrow for the cars to pass through with barriers installed.
Organizers say a course won't be determined until after a letter of intent is approved by the city council (a vote is set for Tuesday). Brad Lund, chief operating officer of OKC Grand Prix LLC, said he hopes the downtown central business district might be a viable option. The same area is targeted for extensive street and sidewalk reconstruction as part of the $140 million Project 180.
A report by the city's special projects manager, Tom Anderson, advises city leaders may have to decide between Project 180 and the race as part of their deliberation. The course would likely require elimination of medians along E.K. Gaylord between Reno and NW 4 and Robinson between Reno and Robert S. Kerr. Such medians were strongly recommended as a means to make downtown friendlier for pedestrians in a report compiled last year by consultant Jeff Speck.
"As OKC Grand Prix LLC desires to conduct its race within the Project 180 area, certain conflicts and differing priorities emerge," Anderson wrote. "Ultimately, some of these may require a policy decision as to whether existing plans for Project 180 are more or less of a priority than hosting an Oklahoma City Grand Prix."
Former Mayor Ron Norick, who has more than 20 years of experience in racing, including ownership of a NASCAR team, is among those concerned that city leaders accurately consider how the race will damage downtown streets.
"I think it's going to be very tough to do it downtown," Norick said. "The capital requirements to improve the streets not only for safety, but for substructure, are high. Those cars have so much torque. Normal asphalt and concrete will not withstand the torque of the cars."