With the excitement of the 35th America’s Cup due to be sailed in the Great Sound in 2017, all sides of the event should be open for discussion.
One of the discussions should be could this be use next year, today we reflect on what happened in San Francisco for the 34th America’s Cup.
When hosting the 2013 America’s Cup was first pitched to San Francisco’s city leaders, it sounded almost too good to be true: A world-famous event that would ultimately cost the city little while bringing both international exposure and a bonanza in economic activity.
As the projections of that economic benefit were being downgraded significantly and reports of lackluster fundraising could leave the city footing a multi-million dollar bill, some local politicians began to grouse publicly about being misled.
Among the most vocal of those critics was progressive Supervisor John Avalos, who told SF Weekly, “all the members of the Board of Supervisors were f*cking played.”
Avalos convened a pair of hearings to look into some of the issues swirling around the increasingly controversial race.
At the latter hearing, the Bay Area Council Economic Institute’s Jon Haveman presented a report on the America’s Cup’s predicted economic impact, which was markedly scaled back from original estimates.
Instead of the 15 teams expected to compete, there was only five (including Larry Ellison’s defending champion Oracle Racing). The overall number of spectators dropped by 700,000, and expected tax revenue lowered by nearly $11 million. Predicted economic activity has also been downgraded from $1.4 billion to just over $900 million.
“We looked at how the world has revealed itself to be different than it was thought to be in 2010. The biggest difference is that there is a much smaller number of syndicates competing than anybody would have predicted,” Haveman told the Huffington Post. “There was initially an over-inflated sense of the level of interest people would have in the America’s Cup. The attendance figures have been scaled down based on the number of people who came out to watch the America’s Cup World Series last year.”
Avalos remains suspicious. “I didn’t think so at the time, but, looking back now, I think...[the event’s backers] were being disingenuous about how much it would cost and the economic impacts,” he said to HuffPost.
According to the initial agreement the America’s Cup Organizing Committee struck with San Francisco, the city was to front some $32 million for infrastructure and permitting expenses. The committee, which reads like a Who’s Who of San Francisco high society, would then “endeavor” to raise enough money to cover the expenses.
The word “endeavor” essentially means that if the fundraisers can’t come up with the $32 million, San Francisco will be stuck with the tab.
However, some America’s Cup boosters have argued that looking at a cost-benefit analysis that ends this year is short-sighted. If Ellison’s Oracle Racing team comes out victorious this summer, the event will likely be held in San Francisco again, and the city will already have the necessary infrastructure in place. That way, it can once again reap the economic benefit of the world’s most high-profile sailing competition, but this time on the cheap.
“I honestly believe that if Larry Ellison wins it, it’s going to be back and be ten times more exciting with more teams next time,” Organizing Committee head Mark Buell told ABC San Francisco at the hearing.
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