Oracle skipper Jimmy Spithill could yet become the Lazarus of yachting. Trailing 1-8 in the first to nine series of the America’s Cup a week ago, it looked all over rover for Larry Ellison’s Oracle Team USA. Across the Pacific Ocean, four and a half million Kiwis were putting their champagne in the fridge to chill.
Now, a week later, the champers is still on ice and Oracle have won the last four (completed) races to claw back to a 5-8 deficit.
Meanwhile, San Franciscans are sniffing the scent of the possible in the fickle winds around Alcatraz, even if the 34th America’s Cup doesn’t bring them the kind of financial blessings the hypesters promised:
America’s Cup gives big payoff in crowds, publicity
By John Coté
San Francisco Chronicle
McClatchy-Tribune Information Services
Sept. 22–The 34th America’s Cup, while it still has the potential to push a new standard in sporting comebacks, will never live up to its loftiest billing. Perhaps diminished expectations were inevitable given the initial hype around sailing’s premier competition.
Then-Mayor Gavin Newsom, smarting over the city’s loss of the San Francisco 49ers, declared in 2010: “Who the heck needs the Olympics and the Super Bowl when you’ve got the America’s Cup?” Expectations rose higher when a report later that year projected $1.4 billion in economic activity for San Francisco and its neighbors, behind only the Olympics and soccer’s World Cup. No one expects a financial bump of that size anymore, even with Oracle Team USA prolonging the races by managing to stave off elimination since Wednesday.
But it’s not all gloom by any means. In its debut on San Francisco Bay, the oldest and most prestigious competition in international sailing overcame a snake-bit start to draw well over 870,000 spectators — and counting — to the city’s waterfront, produced what some analysts called one of the greatest sailboat races of all time, and spurred the city to complete more than $180 million in long-planned improvements around the waterfront, the most notable being a new cruise ship terminal at Pier 27.
The economic benefits are still being tallied, and while “less than anticipated, they are substantial,” said Jane Sullivan, a spokeswoman for the city’s America’s Cup group. Ellison’s goal It remains to be seen whether bringing the races close to shore for the first time in the Cup’s 162-year history and using high-tech 72-foot catamarans will accomplish software billionaire Larry Ellison’s goal of attracting a new generation of sailors to the sport. Ellison’s Oracle racing syndicate, by virtue of winning the Cup in February 2010 off the coast of Valencia, Spain, got to choose the location, timing and boat type for the next regatta.
The swift, expensive and dangerous catamarans chosen were the foundation of an event that suffered from labor disputes, a lack of competitors balking at the $100 million needed to field a competitive team, a string of “races” with only one boat on the course, a cheating scandal by Oracle Team USA, and the stunning death of an Artemis Racing sailor who was trapped underneath a capsized boat during training. Instead of 15 teams — the basis for the $1.4 billion economic projection — there were four. A deal that would have given Ellison rights to develop public waterfront property in exchange for rehabbing dilapidated piers was also scrapped in 2012.
Whether or not you were a fan, the Cup has drawn visceral reactions from its start to its now near-finish. Saturday’s races were canceled because of predominantly southerly winds that made the course unplayable. Supporters hyped the regatta as a cash-cow and global event. On the political left, Supervisor John Avalos said the city had been “played” and was subsidizing a billionaire’s boat race. A local arts group led by showman and erstwhile mayoral candidate “Chicken” John Rinaldi canceled its plans this month to do a big publicity stunt to mock the America’s Cup, “as that would be redundant.”
Still, while plenty of people had little interest in the event, it attracted far more than just sailing enthusiasts and legions of black-shirted, folksy Kiwis backing their national team. Julia Bergman, 41, a full-time mother in the Financial District, wasn’t initially a sailing fan but brought her two young children to watch many of the races for free at the America’s Cup Park on Piers 27/29. “We’ve been here nearly every weekend,” Bergman said while perched on a picnic blanket with her 15-month-old daughter catching a recent midweek race. “We are making the most of the fact that it’s here on our doorstep. … We’ve really gotten into it.”
The 870,000 attendance figure from the America’s Cup Event Authority only includes spectators at two official venues. Stephen Barclay, CEO of the event authority, contends the figure could more than double when you include spectators from spots around the bay like Fort Mason, Crissy Field and Aquatic Park. Last Sunday, dozens of spectators, some with folding chairs, lined the bike path overlooking the bay between Aquatic Park and Fort Mason. Along with eliciting lots of debate among nautical experts, the controversial boat choice also went a considerable way toward transforming competitive sailing into a telegenic sport with an extreme edge — all set against the cityscape, Alcatraz Island and the Golden Gate Bridge and broadcast to 170 territories around the world. “You can’t put a dollar amount on that,” said Mayor Ed Lee’s spokeswoman, Christine Falvey.
Even former Board of Supervisors President Aaron Peskin, a steadfast critic of the city’s financial deal to host the regatta, acknowledged the sailing made for great television. “I haven’t missed a race yet,” Peskin said last week of his habit of catching the sailing on TV.
Cost to taxpayers elusive
The cost to taxpayers, though, remains an elusive question that won’t be answered for weeks. San Francisco officials say the city’s expenses for hosting the races will be considerably lower than its most recent projection of about $22 million. Additional transit services and other budgeted expenses weren’t necessary because crowds, while heavy in the last two weeks of roughly three months of sailing, didn’t have the anticipated toll on public services. “Costs are coming in way below what we had budgeted,” said city spokeswoman Sullivan. She declined to give a specific figure because numbers were still being tabulated. Among the decrease in costs is about $800,000 being reimbursed from the National Park Service after spectators didn’t have the expected impact on Golden Gate National Recreation Area, including Crissy Field, another city official said.
As of June 30, the city had spent $13.4 million on the event, with almost $8.4 million of that reimbursed by the America’s Cup Organizing Committee, a group of civic leaders that was finally expected to raise $32 million to offset city costs and won’t reach that goal. The committee has raised more than $16.5 million, said Kyri McClellan, its CEO, but about $3 million has gone to other event-related commitments, including bike valets, a wrap-up economic analysis due in November, and the Treasure Island Youth Sailing Center, a nonprofit that teaches public school kids to sail. An economic impact report, based on four teams and released in March, projected 2 million attendees over almost three months of racing, $902 million in economic activity, and event-related tax revenue of $13 million. The city expects to get a final figure on its costs, as well as tax revenue from the event by November. The committee will continue to raise money through the end of the year, McClellan said.
Loss or not?
McClellan said she was confident taxpayers would be made whole through the fundraising and increased tax revenue tied to the event. But applying event-generated taxes was not part of the original deal that the Board of Supervisors signed for in December 2010, said Avalos. “Clearly (the event) didn’t live up to expectations,” Avalos said. “The subsidies for the America’s Cup promoters increased as support for bread-and-butter services for everyday San Franciscans stayed about the same. We were promised a regatta of 15 boats but ended up with three billionaires in a tub.” Asked what the Cup’s legacy would be for San Francisco, Peskin replied: “Debt.” His successor as board president, David Chiu, disagreed. “While we hope to break even, if we have to spend a little, the America’s Cup brought hundreds of thousands of visitors and hundreds of millions of dollars in local spending that we otherwise wouldn’t have seen,” Chiu said. “I think that was worth it.” Barclay, in a recent online posting blasting critics of the event, said the city’s general fund “will be close to breaking even,” and maintained the city has received hundreds of millions of dollars in economic benefit and thousands of jobs. The event authority alone has generated more than 1,000 contracts with businesses, he said earlier.
‘A vision delivered’
The four teams brought contingents that were hundreds strong, lived here for months, rented homes, bought groceries and went out to dinner. Team Emirates New Zealand alone had about 400 people, including team members and their families. They rented 85 apartments. Several thousand visitors associated with the team’s sponsors also visited. “Larry Ellison could have chosen anywhere in the world to host the racing, and he chose San Francisco,” Barclay wrote after a riveting on-water duel in race 10. “You are witnessing a vision delivered.”
(c)2013 the San Francisco Chronicle
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