Comptroller cautiously paves way for F1 fundingAugust 13th, 2012 at 11:38 pm by Josh Hinkle under Politics
It’s been a source of controversy since at least May 2010 – state money going to Austin’s Formula 1 race. Now it appears the Major Events Trust Fund is once again in play, and this time that big business is closer than ever to getting millions from Texas.
Texas Comptroller Susan Combs first came under fire for early use of the words “certify” and “full funding” in a letter to F1 bosses two years ago. When KXAN questioned her about the legality of that move in February, she insisted it was merely a sign of good faith, not a promise.
Those concerns calmed when Combs pulled the possibility of state funding until after the first race. This seeming turn in support came amid work stoppages at the construction site, reports of infighting between organizers and the announcement that New Jersey would host a second U.S. Grand Prix event.
Speculation had swarmed in recent months over whether organizers would attempt to tap the METF again. After the inaugural race was pushed back last year, they had to pull their application, as it may only be submitted within a year of the event.
With November 18, 2012, firmly on the calendar, the organizing committee and the City of Austin re-submitted the plan – complete with an updated economic analysis – to the Comptroller’s office one month ago. As statute requires, Combs’ office had 30 days for analysis.
On Monday, her team determined the event would indeed result in a substantial increase in tax revenue – an absolute must before an event can later receive the state funding. This determination means the wheels are in motion, but they are moving cautiously, according to the state’s letter to the Austin City Manager:
“Please note that this letter does not constitute an approval for reimbursement. Reimbursement is subject to meeting all statutory requirements and providing any other documentation required by the Office of the Comptroller.”
That’s nearly $30 million that F1 stands to gain with this possible deal, if all goes as planned. The state would give most of that amount, while the Circuit Events Local Organizing Committee would handle the local match for the city.
But, if F1 wants the money, it must show significant signs of economic success in three months, as 300,000 racing fans are expected to swarm the area. The state’s analysis predicts:
- Estimated incremental increase in tax revenue to the State of Texas – $25,284,468
- Local match required – $4,045,516
- Total contribution to the Major Event Trust Fund established for this event – $29,329,984
Check out KXAN’s original investigation into Combs’ financial role with Formula 1 below: