Organizers of Circuit of The Americas, the $300m purpose-built road course under construction Austin, Texas, announced Tuesday that they are suspending further construction of the project until a contract assuring the Formula 1 U.S. Grand Prix in 2012 is complete.
Full Throttle Productions, headed by Tavo Hellmund, has a contract with Bernie Ecclestone's Formula One Management group to hold races for 10 years, starting in November 2012, but those rights "have not been transferred to the Circuit of the Americas per a previously agreed upon timetable," COTA said in a statement.
While construction at Circuit of The Americas has progressed as scheduled with more than 300 workers at the construction site daily, all work will suspend immediately, until the contract dispute is resolved.
“We have spent tremendous resources preparing for the Formula 1 and MotoGP races, but the failure to deliver race contracts gives us great concern,” said Bobby Epstein, founding partner of Circuit of The Americas. “We believe the United States is vital for the future of Formula 1 and its teams and sponsors. Given the purpose-built Tilke design, creating a unique fan experience and iconic challenge for drivers, we hope that Texas will not be left behind. More than 100,000 fans have expressed an interest in purchasing tickets for Formula 1 alone.”
“It is in the best interest of all parties to reach a timely resolution,” said Red McCombs, chairman of McCombs Enterprises and founding partner of Circuit of The Americas. “Local businesses, fans and the state of Texas are counting on us.”
Back in September, Hellmund contacted Texas State Comptroller Susan Combs to ask whether a change in management or promoters would affect the circuit's eligibility for money from the state Major Events Trust Fund. Combs responded that the race would still be eligible for the incentives in a letter to Ecclestone.
However, Combs announced on Tuesday a substantial change in how state funds would be disbursed, saying that no money will be spent on the race in advance. Although Austin GP officials have stated the recent announcement of a second U.S. F1 race in New Jersey, due to start in 2013, was no threat to their project, Combs indicated she was not convinced that was the case.
"The recent announcement of an annual Formula 1 race in New Jersey is a concern, as additional races have the potential to reduce the number of attendees to a Texas race, thereby decreasing the economic impact," Combs said in a statement. "Additionally, the reports of a slowdown in construction at the Circuit of the Americas, and recently publicized disagreements between the race rights-holder and the circuit developers have prompted speculation about whether the Austin race will even occur. The ongoing controversies are a concern and we will continue to monitor them.
“Let me state clearly: We have not paid out any money for the Formula 1 event. The only dollars that can be spent on the United States Grand Prix are tax revenues attributable to the successful running of a race. The state of Texas will not be paying any funds in advance of the event. Further, as is the case with all METF events, each application will be reviewed and analyzed for its likely economic impact and only after the race occurs would any funds be disbursed.
"If an METF application is submitted, it will be thoroughly vetted and economic impact data scrutinized based on the actual circumstances for that event. Ultimately, I am responsible for protecting the interests of Texas taxpayers, first and foremost. I will not allow taxpayer dollars to be placed at risk. My position on that has not changed.”