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By Alan Snel, LVSportsBiz.com Publisher-Writer
The big day came for Clark County Tuesday. Its county staff assembled a “debriefing” report on the Formula One race Nov. 18 that brought in a lot of money for the Las Vegas Grand Prix’s promoter and the high-end hotels while financially hurting many small businesses in the Strip corridor.
As Clark County Commissioner Michael Naft put it, There were “big winners and big losers.”
The winners were Formula 1, which is owned by Colorado-based Liberty Media. F1’s Las Vegas Grand Prix said it sold out its tickets for the Nov. 16-18 road race that took over 3.8 miles of prime Strip corridor roads, including a big chunk of the Strip itself. The tickets were pricy, so expensive that prices kept most locals from attending the much-hyped 90-minute car race.
Clark County revealed its debriefing report, which listed several different economic impact numbers without showing the methodology of how these numbers were reached. The report said the race event generated $77 million in tax revenue from items like room taxes, live entertainment taxes, sales taxes, gaming taxes and property taxes. Click for debriefing report.
The losers were the many Las Vegas businesses that suffered financially and lost millions of dollars in revenues because their customers could not reach their stores due to the race’s barriers and fencing.
The traffic jams for nine months leading up the Nov. 16-18 race event also caused millions of dollars in lost commerce and worker time. One Harrah’s worker, Eileen Scott, told the county commissioners that the “pain and suffering and traffic chaos was not worth the money I made at my job.
Randy Markin, who manages the Battista’s Hole in the Wall Italian restaurant, said it was wrong for the county to permit a race that caused so many businesses to lose money so that Formula One could make its millions of dollars.
Even the chairman of the Clark County commissioners called the traffic caused by F1 a “nightmare.”
“We have to figure out how we can live through these three years,” Commission Chairman Tick Segerblom said after the session. The county has a ten-year deal with F1, with the first three years locked in, he said.
Wade Bohn, who owns Jay’s Market near Battista’s, said he lost millions of dollars during the time leading up the race. (Disclosure: Jay’s Market is a LVSportsBiz.com advertiser.)
“We don’t need F1,” Bohn said. “They need us.”
Here’s a photo showing a temporary bridge installed in Flamingo Road spanning the Koval Lane intersection that devastated revenues at Bohn’s store. Koval Lane was part of the closed course.
The Clark County report revealed the immense amount of time the county government spent on processing the plethora of event permits and applications.
County staff spent a stunning 17,059 hours on F1 race work, costing Clark County government $4,301,630. The county department revenues from the F1 race amounted to $3,838,764. That meant Clark County government itself lost $462,865.
Of the seven county commissioners, Ross Miller, was absent and a few others like Marilyn Kirkpatrick appeared to focus on F1 not meeting permit deadlines. For example, the county wants the Las Vegas Grand Prix to submit a transportation plan by May 1 and give county staff 90-day notice on permit applications.
One plus for Clark County is that, according to Segerblom, Formula One has taken its request for $40 million from Clark County for repaving the 3.8-mile race course roads off the table. Take a listen:
Las Vegas Grand Prix representatives sitting in the audience declined to comment to the media about the county’s F1 debriefing report. They, instead, scooted out of county government center meeting room. A grand prix PR rep did say the race would be issuing a statement.
Here’s that statement, with yet another economic impact number:
“As we plan for the 2024 Las Vegas Grand Prix, we continue to work with all local stakeholders to ensure expanded opportunities for the community. The county has provided helpful feedback and recommendations for a smoother implementation this year, and we have already begun addressing those recommendations.
“This year’s race preparations will be significantly streamlined, which will lead to far fewer traffic disruptions in a much shorter timeframe. While addressing the lessons learned of a first-year event, we are also proud of the tremendous success of our inaugural race, with a record of nearly $1.5 billion in economic impact and unmatched global exposure for our destination.”
Here’s a look at the debriefing report on fire prevention:
Our one LVSportsBiz.com takeaway about bigtime sports and county government is that the debriefing session validated that sports promoters and the big hotel companies dictate major sports event public policy.
Clark County commissioners talked about F1 race permitting issues like deadlines and internal staff work loads, but they did not addressing the central question about the Las Vegas Grand Prix: Was F1 race beneficial for Las Vegas market?
Formula One is forging ahead with ticket sales. MGM Resorts International CEO Bill Hornbuckle, in a recent quarterly earnings report call, said the company’s high-end hotel properties benefitted from the F1 race but that not all hotel properties benefitted.
In a letter to the commission, Hornbuckle wrote, “We know that infrastructure improvements required for the race caused significant pain points for our community, especially when coupled with ongoing infrastructure improvements to I-15 and the resort corridor. We also know that many in the community felt that their opportunities to participate in race weekend were limited.”
But Hornbuckle added that there were reports that grand prix officials planned to to have “more affordable tickets for a broader range of viewing and activation areas.” And even MGM Resorts International itself “has reevaluated its room pricing strategy for this year’s race to expand reach more deeply across our portfolio of resort hotels.”