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The Road to Elroy For F1 Wheeler Dealers

October 19, 2012

Tavo Hellmund and Red McCombs: The mind and the money behind the US Grand Prix coming to Austin

We are influenced.  We are led.  We become subjects of an illusion that is designed to influence our behavior, so someone else can profit.  Using basic human instinct to compete, to survive and improve social standing, we follow the most attractive options offered to us … with little scrutiny. 

This is the science of marketing. Make it look so good that you cannot pass up the opportunity … it’s always worth the risk.  Just like the small print in a contract, very few bother to pull out the magnifying glass. So, let’s PARTY!

Enter the  Wheeler Dealers, shrewd and sometimes unscrupulous persons, who know how to circumvent difficulties. Someone who can make clever, complicated, and sometimes dishonest business arrangements. Opportunist: a person who places expediency above principle … one who uses secret influence (i.e. pulls wires or strings) for his own ends.

Elroy, Texas and all points east on FM 812 are nothing more than Test Dummies for this great hope for revenue, speed, glamor and the star power of F1.  We are experimental subjects and sacrificial lambs.  The ‘Big Bucks’ won’t be shared with us. But, we can enjoy the show along the roadside as eager visitors rush to spend their money at the track … but not along the way. 

Texas taxpayers would foot 1st Formula One bill

  •  Budget rider allows $25 million in state money to be used for fee to bring international race.

  •  Texas taxpayers are putting up the first $25 million in a deal aimed at luring Formula One racing to Austin.

  • … the money, to be deposited in the state’s Major Event Trust Fund, would pay the sanctioning fee London-based Formula One Group charges for the privilege of hosting the first of 10 annual F1 races planned for Austin beginning in 2012.

  •  Austin resident Tavo Hellmund would organize and promote the races.

  •  Texas Legislature’s authorization to use general revenue funds for F1 can be found on page 933 of the 988-page budget that legislators approved a year ago — though mention of a car race is nowhere to be found.

  •   $25,000,000 is appropriated from General Revenue for the biennium beginning September 1, 2009
  •    the money is tied to the passage of the bill that added Formula One racing to sporting events eligible for the trust fund.
  •   the trust fund had not been used in this way before and that officials are still figuring out the details.

Bernie Ecclestone, president and CEO of Formula One Group, announced that Austin would host F1 races from 2012 through 2021. Typically, local organizers must come up with a sanctioning fee, said to be between $25 million and $50 million each year, to pay Formula One.

A press event was the big local roll-out - in between F1 supremo Bernie Ecclestone making the initial announcement on his own schedule, and some pretty wild speculation both in and out of the media, they’ve often been chasing the story rather than leading it.

The who: The big name backer is Red McCombs and his investment group. Turns out that, like Ecclestone, he and Hellmund go way, way back. According to Hellmund, it’s not just that McCombs has deep pockets (they don’t put your name on Darrell K. Royal Texas Memorial Stadium just because you have a nice smile) or that, as the former owner of three pro-sports teams (Minnesota Vikings, Denver Nuggets and San Antonio Spurs), he knows big money sports. Calling him “arguably one of the most respected business people, entertainment and sports legends,” Hellmund explained, “Twenty-one years ago, one of mister McCombs car dealerships was my very first sponsor.”

The who else: An interesting panoply of names cropped up. Aside from Comptroller Susan Combs and developer Richard Suttle, who were both present, Hellmund namechecked McComb’s director of business develoment (and former Longhorn Baseball player) Rad Weaver, ex-MotoGP World Champion Kevin Schwantz (raising the possibility of motorbike racing following F1), and Robert Epstein of the Austin-based Prophet Capital Management. McCombs also said that he’ll be working with the state’s universities to bring them in to the tech park aspect of the facility. He noted the presence of several UT officials, including Athletics Director DeLoss Dodds, who has no little experience in big-scale sporting events. Present and not mentioned was Hellmund‘s “sounding board,” Paul Carrozza of RunTex, again no rookie in this field.

One Commenter lamented:“… bringing F1 here at this time would have the same disastrous result as in Dubai. Hotels and skyscrapers were built to accommodate the F1 track in Abu Dhabi, but people failed to fill the stands and hotels. Bernie Ecclestone might bring us one race, but at $400 a ticket, how many will come?” And:

Racing before human services …”Budget ax likely to fall hard on health services” and “Texas taxpayers would foot 1st Formula One bill”.

Who is setting this state’s fiscal and moral priorities? F1 promoters claim, the $25 million they get from taxpayer dollars will eventually be returned to the people, what happens in the meantime to the children who go unvaccinated; to the folks with compromised state services?

Allowing our elected representatives to place auto racing ahead of health and human services is a disgrace, and it says a great deal about who we are as a people. I am ashamed, and you should be, too.

Here, we have the F1 Circuit of the America EXTRAVAGANZA!  The United States Grand Prix is a motor race which has been run on and off since 1908, when it was known as the American Grand Prize.  Circus Barkers, Bernie Ecclestone, Red McCombs, Bobby Epstein, and race promoter Tavo Hellmund, have sold us a VERY expensive side show. Texas is always attracted to glitter and gloss, speed, glamor and star power  … we are easy prey to fantastic ideas. 

Counterclaim filed in F1 land lawsuit

“It will bring INTERNATIONAL acclaim!  It will make us all RICH!”  ONLY after the London Based “Formula One Group” makes their profit.

It will change the lives of sleepy little Elroy Texas and everyone who depends on Farm Road 812 to commute to and from work.  The nearest grocery store, for this end of FM 812, is 26+ miles away, in every direction.  There are grocery stores in Austin, Bastrop, San Marcos and Lockhart, but nowhere near Elroy or Cedar Creek.  We need a REAL grocery store more than a traffic hazard …. 

For almost a year, TxDot has been tearing up and replacing parts of FM 812 to the dismay of commuters.  Long waits for huge equipment, reductions to single lanes and detours during rush hour have frustrated drivers. And, OMG the dust, dirt and fumes hanging in the air!  Today, most of the upgrades have been completed, but that won’t last long when F1 traffic starts using FM 812 as a shortcut to the track. That commuter lifeline we depend on will be more dangerous than it already is. Travelers along FM 812 are almost always impatient and tend to pass on the hills, curves and ‘No Pass’ zones.  There are too few shoulders on FM 812 and about once a week you will pass a car or truck nose down in the ditch.

Living in southern Bastrop County Texas has been mostly peaceful … until construction began on the “Circuit of the America’s” racetrack.  At best it used to be a 20 minute drive to work in Austin.  Once construction started, commutes got longer and longer and more dangerous.  Don’t get me wrong, I do appreciate the improvements to FM 812, however, they seem incomplete and ongoing, because the heavy trucking keeps damaging those improvements. Because the road surface has improved, travelers now drive even faster … and there are still no shoulders available the further east you go.  From State Hwy 21 west toward State Hwy 183 is great … until you get to Elroy Texas.  Then it’s stop and go and the air quality is ruined by the dust kicked up by construction.

We are all Test Dummies For Wheeler Dealers

One month out from Austin’s inaugural Formula One race, there’s still plenty of work to be done before the F1 circus arrives for the Nov. 18 race that could attract as many as 120,000 fans.

How the Austin F1 story has unfolded

Timeline begins in 2010 May 25 – Formula One Management CEO Bernie Ecclestone

Tavo Hellmund of Austin serving as race promoter.

  Exactly one year ago,  Next year’s F1 race in Austin looks grim

Formula 1 track in Elroy, one setback seems to follow another.

In April of 2012 we all knew, Formula One’s history in U.S. plagued with problems

Taking a closer look at economic benefits claimed for Austin’s Formula One project

F1 world confused about Austin race

F1 is considered the most prestigious form of racing in the world. The cars are lightweight, aerodynamic, extremely fast — and among the most difficult to master in all of racing. …

This is what Austin, Travis and surrounding counties and the little community of ELROY TEXAS was promised …. !

Study projects large economic windfall from F1 race

… would generate just under $288 million in direct economic impact for the area, according to an estimate released Monday by promoters of the race. That spending would produce $26.6 million in new tax revenue for the state, even though the state is committed to spend $25 million to the track promoters …

Sadly, the numbers fail to show what benefits sleepy little Elroy Texas would receive, besides some road improvement …

Race promoter, Circuit of the Americas officers and investors settle lawsuit

The lawsuit between race promoter Tavo Hellmund and Circuit of the Americas officers and investors, including San Antonio billionaire Red McCombs, has been settled, according to circuit chairman Bobby Epstein. Details were not disclosed by either side.  Hellmund was seeking unspecified damages, claiming the circuit had stopped paying his $500,000 yearly salary …

Formula One has failed to establish itself in America, despite corporate sponsors’ need for exposure in the world’s biggest market. Partly because of the steep fees that Mr Ecclestone charges to host a Grand Prix, circuits often end up losing money and stop hosting the event; there has been no American race for the past five years. That will soon change, with Austin, Texas, hosting a race in November and plans for a Grand Prix in New Jersey in June 2013. Red Bull, a team owned by an Austrian energy-drinks firm, is said to be looking at launching a new “Stars and Stripes” Formula One team with American drivers. Local drivers boost audiences.

Downtown ELROY South.

Austin Texas, Travis County and the State of Texas bought in to this “Grand Plan”.  At a time when Oil and Gas prices are volatile, the economy and jobs are critical, budgeting services and over-consumption is under scrutiny, these rich entrepreneurs get together and ignite the audacious scheme called the Circuit of the Americas Formula One racetrack. The ‘Carnival Barkers’  shouted JOBS! REVENUE! RICH SPENDERS! and our State and Local politicians bought the story … literally. ~

The 2012 United States Grand Prix will be the first Formula 1 race held on American soil since 2007. Austin promoters, and those who are looking to pay for this extravaganza, are looking to book concerts, other kinds of races and events to pay for their investment. 

 I am sure that after a  long while, some revenue will leak out into the small communities of Cedar Creek and Red Rock, east of the track. But, so far we have only been invaded, inconvenienced and shunned.  You do see more and more inflated real estate prices that anticipate a land grab.  Ask local real estate agents and they will laugh at you.

Such an impressive name and promise of attracting global millionaires, has mesmerized Austin and the elitist towns WEST of the track.  Hotels, restaurants and service industries are salivating at the prospect. But, points just EAST of the track are just enjoying some road improvement, long delays, air pollution and heavier traffic.

So, thanks to Texas Wheeler Dealers,  1000+ acres and the promise of 1300+ jobs has dazzled Austin but disconcerted Elroy and the busy Farm Road 812.

Affectionately called CoTA and Formula 1: This rich man’s extravaganza is selfishly excluding the sleepy little town of Elroy, Texas and it’s 200 residents from benefiting from the expected crowds and infusion of revenue.  Austin and Travis County want it all as they fight to annex the race track and exclude the local community. 

Downtown ELROY North.

The announcement of Motorcycle races, Concerts and other racing events have been packed into this investment to justify the enormous expenditure of Public Tax Money. “This is a project with many moving parts,” McCombs said Tuesday.  “We are not home yet.”

 

AUSTIN (KXAN)In four weeks, Downtown Austin will be transformed into a mega party, with Austin Fan Fest all part of the Formula One race weekend.. While there’s expected to be huge crowds, some businesses are worried how they’ll deal with the whole festival’s logistics.

F1 annexation could cost ESD thousandsF1 annexation could cost ESD thousands Annexing the area surrounding the Circuit of The Americas … Annexing the area surrounding the Circuit of the Americas Formula One racetrack could bring thousands of dollars in tax revenue to the city of Austin.  But it is the same money that would be taken out of the pockets of Emergency Service District No. 11.  “We would lose anywhere from $500,000 to $1 million,” said ESD No. 11 Chief Ken Bailey.  ESD No. 11 has four fire stations, including one that sits just blocks away from the CoTA track . Bailey said they will be servicing the area around the track during race week regardless of annexation.

MotoGP, V8 Supercars tickets on sale

MotoGP, V8 Supercars tickets on sale  Tickets for the 2013 MotoGP and V8 Supercars series at Circuit … for the 2013 MotoGP and V8 Supercars series at Circuit of The Americas are on sale now, and the sales process includes a chance for race fans to make a direct donation to local, environmental organizations.

That’s very nice, since there was no environmental consideration when they started demolishing a pristine natural environment …

F1 is filling rooms way outside Austin

F1 is filling rooms way outside Austin  As Austin’s Formula One race approaches, rooms are getting tougher to find anywhere near the track — for that matter, anywhere far from the track, too. Hotel rooms and Bed & Breakfast inns are sold out as far as Marble Falls for race weekend.  “No one expected that to move out this far,” said Peggy Franklin, general manager at the Hampton Inn on the lake in Marble Falls. “We’re 60 miles from Austin so we were all a little caught off guard.”

Where the hell is ELROY in this picture????

Permits needed for those planning to sell goods, host a party F1 weekend

More musical acts announced for F1 weekend performances

Formula 1 weekend security plans revealed

Traffic plans revealed to keep people across Austin mobile during F1

Travis County sports fans beware!  All your eggs in this basket could be broken:

Oct. 19 (Bloomberg) — A Formula One race in New Jersey was postponed a year until 2014 after organizers “misjudged” the commercial and logistic requirements for hosting the event, series chief executive Bernie Ecclestone said.

“They didn’t really realize how difficult it is to arrange these things, commercially and with everything else,” Ecclestone said by telephone today.

Formula One, the most-watched auto racing series, is scheduled to return to the U.S. for the first time since 2007 on Nov. 18 at a new $300 million track in Austin, Texas.

NO, NO, NO! Elroy, Texas is NOT Austin …

Still set to distract our minds from the 2012 Election Season, the first race will happen on November 18.

On August 15, 2012, a counterclaim has been filed by a Travis County financial manager denying all allegations made against him and other Austin Formula One investors in a lawsuit filed by Texas entrepreneur Hillary Ryan in July.

Kam Kronenberg filed a response and counterclaim in the 126th District Court in Travis County on Aug. 12 against Ryan, principal of Thunderhill Ranch Holdings LP, alleging breach of contract and business disparagement.

The dispute is regarding 78 acres in East Austin that are now part of the Circuit of the Americas facility, which will be home to the inaugural Formula One U.S. Grand Prix race in November.

Official Circuit of The Americas Experiences Ticket Package Benefits:

Security – Official Ticket Packages come direct from Circuit of The Americas™ and offer you the peace of mind that you’ll receive what you need with no risk of broker and scalper integrity. With fixed pricing, you don’t have to worry about “playing the market” and running the risk of being priced out. Additionally, Official Ticket Packages will be delivered weeks in advance of the event to your mailing location.

Unparalleled Access – Official Ticket Packages, are exclusively available through Circuit of The Americas Experiences, include in-track hospitality party venues at Circuit of The Americas™ on event days. Circuit of the Americas Experiences’ climate-controlled hospitality party venues  include food, premium bars, simulcast TV coverage, and more. You won’t find an experience like this anywhere else!

Block Seating – Don’t be concerned about being separated from your group! Circuit of The Americas Experiences is able to offer block seating requests so you can enjoy the races together. If you want to bring a large group to the races, Circuit of the Americas Experiences can accommodate your needs.

Convenience – To ensure a first class experience, Circuit of The Americas Experiences’ Official Ticket Packages are all-inclusive. Official Ticket Packages, include tickets, access to VIP hospitality party venues, insider extras, accommodations and more exclusive extras you won’t find anywhere else! And our additional concierge services ensure that everything from accommodations to your transportation can be arranged. Circuit of The Americas Experiences can take care of everything for you!

Accommodations – Official Circuit of The Americas Experiences’ Ticket Packages have a variety of accommodation options and upgrade alternatives. Enjoy your stay at a spectrum of choices at some of the most luxurious hotels located in the track’s surrounding areas. You are sure to have a first class experience!

The next time I’m stuck in traffic on race week, and have to inhale dust and fumes.  I will be compensated by knowing that someone sacrificed my peace and quiet and clean air, for speed, glamor and the star power of F1.  Maybe in the far distant future, those who will profit from all this destruction will take a little road trip down Farm Road 812 and appreciate what money has bought them.  Everyone else in helicopters, limousines and chartered buses will never appreciate our sacrifice.

THEY BRING US A RACETRACK WHEN WE REALLY NEED A GROCERY STORE!

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