Consultant: Raceway could 'dominate' economy
No decisions have been made on who would own or pay for the motorsports track.
By STEPHEN SIFF
VINDICATOR TRUMBULL STAFF
VIENNA -- A proposed indoor motorsports track here has the potential to infuse $100 million into the local economy annually, as well as another $100 million during construction, according to a consultant's study.
"This thing has the potential to dominate the area economy," said Stephen Szanto, senior managing consultant with Public Financial Management in Cleveland. "It can have major results."
It would cost between $275 million and $300 million to build the 3/4-mile racetrack and exhibition center near Youngstown-Warren Regional Airport, he said.
Paying for it with a 27-year bond, as the consultant suggests, will cost someone between $19 million and $23 million a year, depending on how the deal is structured.
Szanto presented his findings to the Western Reserve Port Authority Board, which commissioned the study, and officials from Trumbull and Mahoning counties Thursday.
Who will pay the mortgage and who will actually own the complex are details that still need to be worked out.
State and federal grants could account for perhaps $80 million, but grant money is not factored into what Szanto calls initial conservative calculations.
Neither is upfront money by the developer.
"It is going to be a joint partnership kind of deal," he said.
The likely partners are Trumbull and Mahoning counties, possibly through some joint authority such as the port authority, and Brant Motorsports, the Morgantown, W.Va., company that originally came up with the indoor track concept for the Pittsburgh area.
The Pittsburgh plan was to have been entirely financed by Brant Motorsports, but it ran afoul with regulatory delays and increasing construction costs, said Bob Brant, the company president.
The original deal was killed by public officials' failure to help cover $100 million in unanticipated costs caused by these problems, he said.
"It is going to have to be a public-private partnership to build a facility of this magnitude," Brant said. "No doubt about it."
County commissioners say they have not considered how they might foot their portion of the bill.
"It will be up to the taxpayers," said Ed Reese of Mahoning County. "The commissioners' role is to put it on the ballot and have people vote on it."
There are no decisions from Trumbull County, either.
"Two words," said Commissioner Michael O'Brien.
Building the facility here makes sense because of the Mahoning Valley's proximity to millions of current and potential racing fans, as well as the lack of other big-time racetracks within a radius of several hundred miles, Szanto said.
"You have the fan base, you have the households, you have the income, you have the people who like to attend races," he said.
"The site is ideal."
Whether or not the facility could turn a profit depends in part on the type of bond used to build it.
If cheaper, tax-exempt bonds are used -- meaning the facility must by publicly owned -- the racetrack could run $3.3 million in the black by the third year, even without a Winston Cup event, the consultant's study says. The Winston Cup Series is NASCAR's showcase competition circuit.
A racetrack financed by taxable bonds could lose between $800,000 and $4.9 million a year when revenue stabilizes in year three, depending on how much business the complex's exhibition space gets, the study projects.
That is, unless it gets a Winston Cup race. Then even the privately owned racetrack could come out $5.7 million ahead, according to the study.
NASCAR has said it won't consider racing events at a track that doesn't exist and has even gone as far as to caution those discussing the local project against using the NASCAR name to describe it.