Formula 1 has a long history in the United States of America. Some of the sport’s greatest and worst moments have all occurred on American soil and the return of F1 to Austin Texas has been, by many accounts, a successful venture.

While the New Jersey Grand Prix is in a state of on-again, off-again status with regards to the F1 calendar, some have voiced an interest in a return to Long Beach California as the West Coast leg of a three-pronged attack on American’s attention spans.

The Long Beach location is now playing host to the Indycar series but that contract ends in 2015 and former Long Beach Grand Prix stakeholder, Chris Pook, has been making noise about a return, which is a bit odd as he is also associated with the New Jersey Grand Prix operation as well.

F1 raced at Long Beach from 1976 to 1983 and Pook was involved then, as he is most assuredly trying to be now. Some 40-years later he’s making noises in the press about working with Formula 1 boss Bernie Ecclestone and Long Beach about doing a deal to bring the race back.

The amount of money needed to host the race is where things get a little dodgy. Some in the press have suggested the cost to be around $100 million but Pook says that’s nonsense, the figure is closer to $9.2 million.

“People have been saying it would cost $100 million,” Pook said, “and that number has just stuck in people’s minds. It’s not even close to that.”

It gets more interesting from there when Pook said the race won’t cost the city anything and that the expenses would be reimbursed. The Orange County Register quoted him as saying:

“The promoters won’t charge the city a fee to conduct the race, and will reimburse the city for all expenses and pay it an administrative fee to cover indirect expenses. Pook said reports of a $25 million fee are in error.

He added that a two-story building would be built along Shoreline Drive adjacent to the garage and pit area that would house F1 operations as well as luxury suites, and it would be donated to the city for use by other events, like the Long Beach Marathon.”

Now, it’s been long known that the sanctioning fee for a F1 race is around $25 million per year with a 10% escalator and the Austin GP tapped into the Texas Major Event Trust Fund in order to pay the fee. Where the fee is getting absorbed for Long Beach is a bit of a mystery for me.

Pook even cited the tax revenue from Austin as a selling point for Long Beach on the kind of revenue they could expect:

“The net tax gain for Austin in 2013 was $4.9 million, and the net gain for Texas was $17.2 million,” he said.

“The value of F1 is that it provides new money,” Pook said. “F1 racing draws a worldwide audience. You would be tapping into new consumers.”

I would really like to see the data on the out-of-state revenue for the Austin GP because the two years I have been there, it seemed like a lot of local and state traffic. Not that there weren’t many attendees from out of the country or state but there was a large contingent of locals or indigenous Texas folk there.

If you look at the offer topically, cost-free and a revenue of $17.2 million in taxes with increased tourism? What’s not to like? Sign us up! I should think the city might want to read the fine print on this one. If there is no sanctioning fee, that would signify a major shift in F1 boss Bernie Ecclestone’s usual deal-maker contract. Something smells a bit fishy and it’s not the Long Beach fish market.

An F1 fan since 1972, NC has spent over 25 years in the technology industry focusing on technology integration, AV systems integration, digital media strategies, technology planning, consulting, speaking, presenting, sales, content strategy, marketing and brand building.
  • Rapierman

    While it would be great to see Formula 1 return to Long Beach (along with an East and North USA GP, but that’s just wishful thinking on my part), this one smells of “if it’s too good to be true, then it’s false”. This is coming from just Mr. Pook. I want to hear all the official sides, Bernie included, before I believe this….and throw in a CPA for good measure, just to be on the safe side.

  • jeff

    I’ve no idea on the economics of holding a Grand Prix; seems like most lose their shirts, and it’s more prestige a la the Olympics rather than revenue that hosting brings.

    As a fan, I’m ambivalent about a Long Beach GP, despite living in San Francisco. The races there, to me, were hum drum, and with the GP tickets being costs high no matter the travel expense, European/Asian GP attendance just as much sense for me. If a stateside race is to be held, I’d hope the hosting area be more picturesque/interesting, or the track itself have more potential a la Austin or Port Imperial.

    • Michael in Seattle

      You are dead right about Long Beach being uninteresting as a race venue. Been there. Catch fencing, parking lots, piles of tires, side streets. . . oh, my. Lets not show the world that we haven’t learned anything since the Phoenix, Las Vegas, Dallas (um, Long Beach) days.

      Austin showed how it could be done in the States. NJ has an interesting, picturesque layout if they can ever pull it off. Someone, some group, please, just pony up and finally turn Laguna Seca into a world class F1 venue. If they’re talking $100 million to get Long Beach ready, that amount should certainly cover the needs to upgrade LS. C’mon, Silicon Valley, you can do this. (Who knows, maybe what with the quieter cars, they could even get San Francisco or even somewhere on the Peninsula to reimagine a street circuit.)

      As a former SF/Marin resident of 25 years, NorCal would be a wonderful addition to the world-wide spectacle that is F1.

      • jeff

        Brewed in Marin, been in the City for the last 15. Unfortunately, the City’s unsuited; too many hills, poor pavement. Sears Point (Sonoma Raceway) is a good track IMO, elevation, some esses, hairpin to the front straight, but requires too much development grandstands/concessionaires-wise, and likely too little runoff for current F1 design. Paul C would speak more here, as that’s his track.) Thunder Hill is undeveloped. You’re right, Laguna closest, but maybe too “tight” for F1? San Jose hosted an Indycar street race for awhile; never watched, but it’s pretty flat in its downtown, and there’s nothing to do in the Valley.

        You guys up north have the space and elevation necessary for good racing; what about tracks in your neighborhood? Some rainy races wouldn’t hurt, and Seattle’s a great food town…

        I’d welcome a West Coast track, but unfortunately can’t think of one that fits both an interesting layout and mature crowd and team resources. I asked E. Schmidt about sponsoring an F1 team, and he laughed and said F1 a poor return. Speaks volumes.

        • Matthew Snyder

          FIA requires a minimum track length of 2.5 miles, with Monaco getting a special exemption; Laguna is 2.2 miles. LS is actually owned by Monterey County, and the surrounding area is parkland; so that complicates any notion of extending the track.

          But none of that addresses the main reason why F1 didn’t come to the track in the late 80s (when the circuit was heavily modified) – Monterey is the sticks. They simply do not have the material infrastructure in place to support a World Championship event. I went to several CART/Champ Car races there (and the sodding wet A1GP race), and even for that friends-and-family type of crowd they were at max capacity. F1 would swamp the entire peninsula.

  • Tom Firth

    Sounds like he’s had the typical hypnotism that Bernie must use to sell an F1 race these days. I Reckon it will end up being another Valencia.

  • I don’t think there is any way that the promoters can gather that money to host the race. The figures Pook is throwing out seem artificially low, but it could be just another way to gain approval. It doesn’t seem Bernie would let a race for anything but an astronomical value. The LA area has more tourists than Austin and that could play into the tax generation, but it is only connected if those fans go there specifically for the race. I guess there is not much of a way to prove otherwise unless there is a very high deviation from the same period over the previous years.

  • Matthew Snyder

    Christopher (Robin) Pook is actually working as Bernie’s emissary in this endeavor. Bernie wrote to the Long Beach mayor last May to confirm if the contract with Indycar would automatically renew, or if the race could be opened to a bidding process.

    According to that letter: “If you and the City Council so determine, the opportunity to operate an automobile race through the City Streets of Long Beach can be put out to open bid. Please be advised that Formula One is interested in returning to your city, and we will consider the appropriate entity to make such a bid if you decide to permit such a process.”

    Speaking as someone whose house used to be on the other side of the harbor from Long Beach and could hear the cars on track – and who hasn’t been back to the race since FTG returned – well, I’m right pleased to hear this news.