Tony Assadi shakes his head as he looks out over the racetrack for the second Grand Prix of Baltimore, which zooms past his Luna Del Sea restaurant and its outside patio on West Pratt Street.
He and his patrons have a clear view — no blue screen blocks the sightline to the street-turned-course. But for that privilege, he signed a contract and was charged $5,000 by race organizers.
"I paid it," he said. "But I didn't feel comfortable. It felt like I was paying a bribe."
As the weekend of racing heads toward the finish line today, the stability and sustainability of the event remains unclear. Tens of thousands of fans packed downtown streets to watch the first two days of the festival, as they did last year, and drivers, though they griped about the bumpy track, once again marveled at the crowds.
But Assadi's concerns echo a larger theme: Does the boost to tourism and business outweigh the extensive and intrusive construction that comes with hosting the event? How deep will organizers need to reach into their pockets to keep the race going? The race's new organizers say they have focused on making the event integrate more seamlessly with the city, but tension still exists.
"These are the key metrics," said Tim Mayer, pegged by race promoter and IndyCar legend Michael Andretti to "quarterback" the group's efforts. "Can we be good neighbors? Can we be good business people? Can we stabilize this thing? Can we make sure traffic flows? Those are the kind of things we're building on, because as we go on with this ... we've got to make people see we're good for the city."
He also said that Race On Baltimore would judge the success of the race not on attendance or money made — they expect to operate at a loss — but by response from the city's citizens and business owners. The Orioles have already praised the group for working to keep the area around Camden Yards tidy and accessible.
While Mayor Stephanie Rawlings-Blake proclaimed the Grand Prix weekend a success immediately after last year's event, race organizers failed to pay their debts to vendors, investors, the city and state agencies. After denying reports that the organizers were financially unstable in the months leading up the race, Rawlings-Blake's administration later publicly severed ties with the racing team, Baltimore Racing Development.
In February, her administration assured residents that they had found a stable and professional group to take over the race. But the second group, Downforce Baltimore, fell apart before making any progress on the event.
J.P. Grant, a Columbia-based investor who has financed dozens of city contracts, took over about three months ago. Grant, one of Rawlings-Blake's top campaign donors, partnered with contractor Greg O'Neill to form Race On Baltimore — the name chosen to quell rumors that IndyCar would not return.
The team hired racing legend Andretti's firm to promote the race and scrambled to organize a stripped-down festival while fighting perceptions that the race was doomed or would again be revealed as a financial liability for the city.
Rawlings-Blake said she marvels at the speed with which they've put together the race.
"You can't plan a bar mitzvah in 90 days, and they've planned a world-class event," she said.
Certainly IndyCar insiders crave stability, and CEO Randy Bernard said Race On must make good on its financial agreements before the circuit can commit to returning. But racing insiders are also looking for evidence of a long-term future that fits with their own goals, mainly regaining fans and enticing national sponsors.
"A successful race looks like the first year in Baltimore did: a big crowd, lots of enthusiasm, a gangbusters event," said Robin Miller, a racing analyst for the SPEED channel. "But then the bottom line came out. Street races are the toughest thing in the world because they're so expensive."
Bernard has hopes of increasing the IndyCar schedule to expand its reach and fulfill television deals. He's seen street races fizzle in other cities, though, and is not ready to declare Baltimore a mainstay.
"I've learned from racing that you've got to be a realist," said Bernard, who was chosen to try to ignite IndyCar's resurgence after building the Pro Bull Riding Tour. "Expect the unexpected. You just can't make a decision until you see how it plays out."
This group's challenge, he said, could not be clearer: "They have to succeed everywhere they failed last year." He said he has been impressed with Grant's organization so far.
Grant, who has invested a good deal of his own money in the race this year, is optimistic that an influx of sponsorship dollars will help the event turn a profit in the future.
His predecessors in Baltimore Racing Development never managed to land a title sponsor. Although they sloughed off concerns at the time, they later acknowledged that the $1 million to $2 million a title sponsorship deal can bring to an event could have made a big difference.
Grant and Andretti were able to secure a presenting sponsor this year and are hopeful that their hard work this year will persuade more businesses to become sponsors next year.
Already, Grant said, several companies have approached him and expressed interest in sponsoring next year's race. A title sponsor paying "seven figures" is a realistic goal, Mayer said.
Grant said a sense of civic duty propelled him to jump in to save the race — and he plans to stick with it for the full five-year contract.
"Ninety days ago, I took a deep breath and said, 'We need to do this,'" Grant said Saturday. "Now, 90 days later, I want to do this."
A Baltimore native, Grant said he wants to see his hometown attract more major events.
"This is a world-class city that deserves a world-class event," he said.
A better start
Apart from the tight deadline, this year's race organizers faced fewer hurdles than their predecessors. Workers had already whittled and smoothed two miles of city streets into a race course — a $7 million city-funded project that caused months of traffic backups. A core group of race fans have hung on through the hairpins turns leading up to this year's event, and were eager to buy tickets and return. There was no need to cut down trees this year. The removal of several dozen trees last year sparked protest and bad publicity.
Business owners, commuters and residents were less surprised — and less likely to be irked — when metal chain-link fences rose up along streets near the Inner Harbor in early August.
Under their contract with the city, Race On is required to pay less money for city services than their predecessors. While Race On must pay $350,000 for city services and a community impact fee, Baltimore Racing Development was billed $750,000 for city services and paid $100,000 to community associations near the track.
But for city officials the new contract contains a key provision: Admissions and Amusement taxes levied on ticket sales are diverted to a "lock box" which guarantees that the city will receive the proceeds. Baltimore Racing Development took nearly a year to pay its city tax bill.
Moreover, Grant has already paid the $350,000 race and community impact fee to the city.
Rawlings-Blake said Friday that she believes the event is already a success because the new team has paid the city and fulfilled its obligations to vendors.
"To me, it was a success before the first grandstand was put up or the first race wall was put up because the race team paid the city in advance," she said. "The city is paid. Their partners have been paid. This race team is capitalized and very professional."
Tom Noonan, director of Visit Baltimore, said that even after the books are tallied, it will be hard to divine much about the race's future this year, given the compressed timeline in which it was planned.
Next year "is going to be a better snapshot of the future than this year," said Noonan. "I think these guys have done a great job pulling it off in 90 days, but it's really hard for me to speculate about the future."
Noonan said he has received preliminary reports from downtown hotels showing that many rooms were booked for Friday night and even more for Saturday. Since city officials began planning for the race, more than two years ago, they have stressed the benefits of boosting tourism over the Labor Day weekend, when people are generally more likely to head to the beach than to Baltimore.
A city-commissioned study indicates that last year's race generated $47 million in economic impact throughout the region. Last year's festival drew 160,000 attendees (although the study counted people who went each day as three attendees) and sold 110,000 tickets over the three days.
A Baltimore police spokesman said the department could not provide a crowd estimate, referring questions to Race On. Mayer also declined to provide a number of tickets sold.
Many downtown business owners, like Assadi, counter that the profits generated by one intense weekend do not outweigh money lost due to heavy traffic and restricted pedestrian access in the weeks leading up to the race.
Some restaurant owners in neighborhoods surrounding downtown, such as Little Italy and Federal Hill, said they lost money during last year's race because fans didn't wander far from the event and other city residents stayed away because they feared heavy traffic.
In response, the city launched a campaign this year to reassure residents that the race won't keep them from reaching these neighborhoods. The mayor's office sent out an email Friday evening titled, "Mayor Rawlings-Blake Encourages Area Residents to Enjoy Downtown and Surrounding Neighborhoods."
"No matter what you love about Baltimore, it is open and accessible for you and your family this weekend," the mayor said in the statement.
The Race On team also tweaked the locations of gates and shortened the schedule of events to encourage fans to visit restaurants, bars and shops in other neighborhoods.
While several of Assadi's peers welcomed the chance to partner with race organizers — Pratt Street Ale House ownership actually approached the Andretti group about a deal — he was turned off by their approach. Mayer acknowledged that Race On made efforts to prevent those without a ticket from watching the race. "We've got to pull them into the event," he said.
As part of the deal, Assadi did receive $2,000 in general admission tickets to give to patrons. That doesn't go far enough in addressing the problem, he said. His upscale restaurant is obscured by fences for about four weeks, and on Labor Day weekend the patio shrinks and all patrons are subjected to the sound of high-powered car engines.
"I recently told [city and state politicians], 'For somebody like you to let people come and take over the city and make money and not have any feeling for business owners who pay dues month after month, how is that serving the people of this city?'" he said.
When asked if she thought the race would continue for the next five years — the length of the city's contract with Race On – Rawlings-Blake said that was "an understatement." Mayer, when asked if he saw any threats to the continued viability of the race, said, "Not from a business perspective."
Rawlings-Blake aspires to make the race a permanent fixture in Baltimore, much as the IndyCar race has been run through the streets of Long Beach, Calif. for three decades.
Rawlings-Blake has consistently pushed to continue the race, even as the first two sets of organizers fell apart. Other city politicians, most notably City Council President Bernard C. "Jack" Young, have urged the mayor to not invest Baltimore's limited resources in a race at a time when budget shortfalls have led to the closure of fire companies and rec centers. Young declined to comment on the event Friday.
Donald F. Norris, chair of the public policy department at the University of Maryland, Baltimore County, said the success or failure of the race will not have a lasting effect on the mayor's political career.
"Mayors are not made or unmade based upon sporting events," he said. "If it's a success, she claims the success and it's a good thing. If it's a failure, she can blame someone else."
Bob Leffler, the Baltimore-based owner of a national sports marketing firm, said that if 30,000 to 40,000 people attend this year's race, it can be considered a success.
"People are already talking about it as if it's going to be here forever," he said. "You're not hearing the complaints from every little neighborhood group."
Leffler was confident that the Race On team could make the event profitable in the future — and sustain it for years to come.
"If they have a whole year to go after sponsors, they'll get them," he said. "It became a hot-button issue for the mayor. These guys are not going to let her down."
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