At a time when Texas is dealing with a record budget deficit by slashing essential services and possibly laying off 97,000 teachers, state lawmakers have committed taxpayers to funding Formula One auto racing at a steep price: $25 million a year for the next 10 years.
The motorsport franchise left the U.S. four years ago because of low attendance, but the effort to bring it back — and base it in Texas — has been spearheaded by B.J. “Red” McCombs, the co-founder of conservative media conglomerate Clear Channel Communications. Despite being consistently ranked as one of Forbes 400 richest Americans — with a net worth last estimated at $1.4 billion — McCombs has gotten state Comptroller Susan Combs to agree to build a racing track in Austin at taxpayer expense. Austin’s city government may also invest an additional $4 million a year in tax revenue to facilitate the plan.
“I don’t understand why 25 people in Austin could not put up $1 million each if they thought this was a good opportunity instead of the state making a $25 million commitment,” said Senator Dan Patrick, a Houston Republican. “The developers should find the money through private sources.”
Bloomberg points out that for $25 million a year, “the state could pay more than 500 teachers an average salary of $48,000.”
Corporate backers of the plan and their GOP allies insist that F-1 racing will pump money and jobs into the Texas economy. But sporting experts say the state is betting taxpayer money on an uncertain investment. Michael Cramer, a former president of the Texas Rangers and Dallas Stars, told Bloomberg, “With places struggling, spending that much money on an essentially one-off event is tough to do.”
F-1 races have tried and failed to gain traction in the U.S. in different cities since since the 1970s. Even Bernie Ecclestone, the CEO of the F-1 series admitted that, “No one wanted to hold it,” until the Austin promoters stepped in.
Richard Viktorin, an accountant with Audits in the Public Interest, says his Austin-based group opposes government support for the races because they are a gross misuse of state funds. “It’s off-balance-sheet financing for a rich man’s sport.”