Source: WFAE 90.7FM View Original
December 10, 2010
Editor's Note: This transcript reflects a correction to the story.
Friday December 10, 2010
Five years ago, NASCAR announced it wanted the sport to have a hall of fame. Five cities bid on the project. Then in March of 2006, NASCAR Chairman Brian France announced the winner.
"Like any tough decision, you look at what's going to be best in the long run. I'm happ y to tell you today the NASCAR Hall of Fame is going to be right here in Charlotte, North Carolina," he said.
But is the NASCAR Hall of Fame good for Charlotte, or as good as was predicted?
When leaders asked for a hike in hotel, motel and car rental taxes to be used to pay for the hall, the project was pitched as having a $60 million annual impact on the city's economy. After construction began, attendance expectations were lowered. The current budget planned for 575,000 first-year visitors. About 300,000 - maybe - is more likely.
"I don't shy away from how the numbers were put together," says Tim Newman, the head of the Charlotte Regional Visitors Authority. Newman led the effort to land the NASCAR Hall of Fame.
"We had a lot of experts, a lot of teamwork around that. And at this stage of the game, it is what it is and we've got to manage going forward," he said.
Newman admits he got carried away with "deal excitement" in projecting such a high return. But Newman says he did not lie to get what he wanted.
"I would not have certainly ever inflated intentionally or anything like that. We were putting the best information forward that we had at the time. None of us foresaw what would happen in the economy in 2007-2008."
Attendance at other halls of fame has been mixed this year. It's down three to five percent at the pro football and baseball halls. It's actually increased by about eight percent at the college football hall of fame. The NASCAR Hall is on pace to outdraw both the football halls and be about even with the baseball hall.
So is the problem with NASCAR's attendance or that project boosters raised expectations so high?
Sports consultant Max Muhleman of Charlotte says it's the expectations.
"Everybody said oh boy this is going to be great. But it was just a bogus number."
Muhleman has worked for the NFL and has developed attendance projections for a number of professional sports teams. From day one he thought 800,000 number was bogus. But he's not calling the NASCAR Hall of Fame a failure.
"There's nothing wrong with Charlotte or the Hall, just the number that was put out there. We should forget that number as soon as we can," he said.
Richmond, Va., also bid on the Hall. Fred Agostino spearheaded that city's effort. He thinks Richmond would have also missed on its expectations of 700,000 visitors.
"I don't think the numbers would have been made anywhere in the country. Now to be off by as much as you were off by, that's another subject... "
So far, the Hall of Fame has lost about $350,000. The CRVA is covering that with money from a rainy day fund. To stem the losses, the hall has made cutbacks, including staff layoffs reduction of staff hours. Newman says the city won't ever have to cover the hall's losses.
And as originally predicted, he says the attraction is paying off in other ways. He says the facility's massive ball room is a key attraction for conventions. He credits the hall with helping land 35 such events.
"We are leading the country among major markets right now in hospitality growth in terms of hotel occupancy and room demand and the things that make a whole lot more revenue for the hospitality industry and the hospitality taxes that come from them than the slight loss we've had on the Hall of Fame," he said.
Newman bases that statement on a monthly industry report. That same report shows the trend started several months before the hall of fame opened.
The NASCAR Hall of Fame will base its second year budget on how big its first year losses are. And that's one prediction Newman is staying away from.