Following the release of a report that determined San Francisco lost $11.5 million as a result of hosting last year’s America’s Cup sailing races, Mayor Ed Lee said today that the city will seek a much better deal if it is chosen as the site of the next regatta.
The report released Monday by the city’s budget and legislative analyst found that the city had a net loss of about $6 million to its general fund and $5.5 million to its ports because of costs to host the races.
San Francisco had been chosen to host the 2013 America’s Cup after Oracle Team USA won the previous regatta and city officials predicted more than $1 billion in tax revenues and economic benefits.
However, only four teams ended up participating in the races, far fewer than the 15 initially anticipated, and San Francisco only ended up getting 27 percent of the impact the city had predicted, according to the budget analyst’s report.
America’s Cup organizers had also pledged to bring in private money to offset the city’s costs but fell short of its fundraising goals.
Lee said today that the city has learned from last year’s races and is taking that knowledge into its negotiations with Oracle, which won last year’s regatta and gets to choose the location of the next regatta in 2017.
“We can’t oversell something that we don’t really have a whole lot experience in,” the mayor said. “We need to learn some lessons from the last time so that an exciting event like this should also not hurt us.”
Lee said one advantage San Francisco will have in negotiations for the next set of races is that the costs related to planning and environmental review of the event—which totaled nearly $9.3 million—do not have to be redone.
“The environmental costs were huge and we won’t have to repeat that again,” he said.
The budget analyst’s report recommended that if San Francisco hosts the America’s Cup again, it should require payment for use of city property and services.
The full report can be found online at http://www.sfbos.org/Modules/ShowDocument.aspx?documentid=47894.
Dan McMenamin, Bay City News