Baltimore City's current financial distress is caused in large part by the bleeding of population to surrounding counties and elsewhere and the exodus of Baltimore based businesses that have followed the population migration. A financially successful Grand Prix would have given the city a much needed lift. Unfortunately, that has not been the case.
While Pittsburgh-based Forward Analytics estimated that the economic impact for the city was $47 million, far less than expected, a UMBC sports economics professor estimated that the race prompted only about $15 million in additional spending. ("Study suggests less economic impact from Baltimore Grand Prix than predicted," Nov. 4.)
Further, the race management firm is insolvent and has over $12 million in unpaid expenses, of which the city is owed $1.9 million. A former Goldman Sachs-Constellation Energy executive has offered to take over management of the race and claims that it can be operated profitably. Whether he can achieve this result is speculative, and, obviously, additional unreimbursed financial investments by the city will be required, regardless of whether the race achieves profitability.
In view of this, the proper question to be asked in deciding whether the city should continue to host the race is: Will an out of the area family or business relocate to Baltimore City because we have a once a year Grand Prix weekend event? One would be hard pressed to answer "Yes" to this question.
The city would be much better served by concentrating its investments in areas that encourage the influx of population and business, such as additional funds for schools, libraries, roads and the like. The Grand Prix should be told to find another location for 2012.
Berryl Speert, BaltimoreCopyright © 2014, The Baltimore Sun