Hamilton Audit shock

[Oldtony]

The problem with this audit is that is another example of the "less than full disclosure" attitude of arrangements for stret circuit proposals.
Certainly the Surfers Paradise event's costings are still very murky and Homebush can expect a full and frank audit with the expected change of NSW Government next year. Tall Ted's attitude to Albert Park is not yet clear. Clipsal seems to be fairly open about costings.
In general the cost/benefits of street circuits is increasingly unclear with the cost side escalating and the benefit side coming under increasing scrutiny.
Problem for everyone is the overuse of the "commercial in confidence" excuse for not publishing full figures.

[GTRMagic]

So where is the sensitivity analysis attached to these proposals?

In any capital request put forward for approval in most large businesses, there needs to be some assessment of the best/likely/worst case scenarios for revenue generation, for costs, for any environmental impacts?

If the people signing off these events choose not to look at the risk of not achieving the most optimistic of cases, then who is the failure here, the people wanting to bring the race meeting to them, or those who sign on the dotted line

It speaks a lot more to the accountability and perhaps economic calibre of the elected officials than to the salespeople hawking the proposal...

[PVDA]

Originally Posted by Oldtony

Tall Ted's attitude to Albert Park is not yet clear.

I fully expect the current non disclosure to continue remembering it was the previous Kennett Liberal government that pinched the event from Adelaide in the first place and the Bracks Labor Government just kept it going.

[Oreti kid]

Originally Posted by PVDA

I fully expect the current non disclosure to continue remembering it was the previous Kennett Liberal government that pinched the event from Adelaide in the first place and the Bracks Labor Government just kept it going.

Hi there Nakkers talking about Albert Park have you heard any update yet RE: officials? seems to be very quite?

[Oldtony]

Originally Posted by GTRMagic

So where is the sensitivity analysis attached to these proposals?

It speaks a lot more to the accountability and perhaps economic calibre of the elected officials than to the salespeople hawking the proposal...

Very true!
And until we can get rid of "commercial in confidence" clause the elected officials will look at the number of votes return rather than the finacial return.
Pink batts was a classic example of the rule that if a Government is handing out money it will always attract a bunch of wide boys to cream off enough for themseves to bring the project into disrepute. Lets hope Motorsport doesn't get that reputation.

[PVDA]

Originally Posted by Oreti kid

Hi there Nakkers talking about Albert Park have you heard any update yet RE: officials? seems to be very quite?

If you applied on line you would've got an e-mail the other day confirming it but no much more info.

[cavvy]

Originally Posted by Oldtony

Very true!
And until we can get rid of "commercial in confidence" clause the elected officials will look at the number of votes return rather than the finacial return.
Pink batts was a classic example of the rule that if a Government is handing out money it will always attract a bunch of wide boys to cream off enough for themseves to bring the project into disrepute. Lets hope Motorsport doesn't get that reputation.

I fear WA are falling into the commercial in confidence hole too ...

WASCC members have been told the club has pumped in a $mil plus to the track revamp that the public have been lead to believe is State Govt funded & for which Coch0 has claimed credit.
NO regular updates to the motorsport public on the spending of taxpayers funds by the WASCC.
Not a good start.

[Mark Petch]

Originally Posted by RogerH

This is exactly what should be happening but Hampton Downs are not part of the cosy club of MSNZ and the established track owners. There are financial benefits to MSNZ to keep the big North Island races at Taupo, Pukekohe and Manfield. MSNZ have not made it easy for Hampton Downs in the past and it doesn't look likely to change. A crazy situation when you have what is arguably the best track in the country half an hour up the road from the Hamilton street race circuit and its not being used.

Rodger,
god knows I have little time for MSNZ, however in fairness to them, I can assure you there are no additional financial benefits, other than miniscule club fees, to keep the so called big North Island races at Manfield, Taupo, Pukekohe, away from Hampton Downs.

In truth MSNZ have really no say in were "big race meeting" take place any were in New Zealand.

Hampton Downs has a unique issue that it is difficult for promoters to make money from Hospitality etc, because of the prime position the virtually 'on track' Town House complexes have on the best viewing spots, and the rights of the owners to have up to '24' people [double that number in reality] in each dwelling.

I am also well aware that without these privately owned dwelling, Hampton Downs would not exist, however if I was promoter, I would not choose to use Hampton Downs over Pukekohe, because I could virtually guarantee to make a buck from Puke's all weather Hospitality suites, in just about any weather condition.

By the way Pukekohe Raceway is not going out of business any time soon, and the Franklin racing club, the tracks owners, have budgeted to spend big money on converting the pit structure to a fully enclosed structure, build new toilet blocks etc, so it will always be a thorn in Hampton Downs business model, as long as it exist as a race track.

[RogerH]

Originally Posted by Mark Petch

Rodger,
god knows I have little time for MSNZ, however in fairness to them, I can assure you there are no additional financial benefits, other than miniscule club fees, to keep the so called big North Island races at Manfield, Taupo, Pukekohe, away from Hampton Downs.

In truth MSNZ have really no say in were "big race meeting" take place any were in New Zealand.

Hampton Downs has a unique issue that it is difficult for promoters to make money from Hospitality etc, because of the prime position the virtually 'on track' Town House complexes have on the best viewing spots, and the rights of the owners to have up to '24' people [double that number in reality] in each dwelling.

I am also well aware that without these privately owned dwelling, Hampton Downs would not exist, however if I was promoter, I would not choose to use Hampton Downs over Pukekohe, because I could virtually guarantee to make a buck from Puke's all weather Hospitality suites, in just about any weather condition.

By the way Pukekohe Raceway is not going out of business any time soon, and the Franklin racing club, the tracks owners, have budgeted to spend big money on converting the pit structure to a fully enclosed structure, build new toilet blocks etc, so it will always be a thorn in Hampton Downs business model, as long as it exist as a race track.

I understand where you are coming from Mark. MSNZ do have a vested interest through their majority (60%) holding in The Motorsport Company Ltd which runs Tier 1 racing. The balance shareholding is held by the established track owners which does not include Hampton Downs. So even if the promotional/revenue issues you have mentioned were resolved, there would still be resistance from The Motorsport Company to run a Tier 1 event at Hampton Downs as it would be contrary to their shareholder's interests and income prospects. They would rather get the income flows going to shareholders (Pukekohe and Taupo) than a non-shareholder (Hampton Downs).

Is the issue with "free" spectators in the Hampton Downs apartments any different to most street circuits such as Clipsal, Gold Coast, Monaco etc where there are multiple opportunities for "free" viewing from properties that overlook the circuit. My understanding is that some of the track owners in The Motorsport Company entity get miffed with the number of free passes that are handed out for the Tier 1 meetings as these undermine their ticket sale proceeds - perhaps these free hand outs have little different impact than the free Hampton Downs apartment owners (and friends).

I think both the drivers and spectators would like to see the V8s at Hampton Downs so it would be great if something could be sorted.

BTW - I have no affiliation with the Hampton Downs owners but have raced at all the North Island tracks and it does seem a pity that such a great drivers track is not utilised.

[Mark Petch]

Originally Posted by RogerH

I understand where you are coming from Mark. MSNZ do have a vested interest through their majority (60%) holding in The Motorsport Company Ltd which runs Tier 1 racing. The balance shareholding is held by the established track owners which does not include Hampton Downs. So even if the promotional/revenue issues you have mentioned were resolved, there would still be resistance from The Motorsport Company to run a Tier 1 event at Hampton Downs as it would be contrary to their shareholder's interests and income prospects. They would rather get the income flows going to shareholders (Pukekohe and Taupo) than a non-shareholder (Hampton Downs).

Is the issue with "free" spectators in the Hampton Downs apartments any different to most street circuits such as Clipsal, Gold Coast, Monaco etc where there are multiple opportunities for "free" viewing from properties that overlook the circuit. My understanding is that some of the track owners in The Motorsport Company entity get miffed with the number of free passes that are handed out for the Tier 1 meetings as these undermine their ticket sale proceeds - perhaps these free hand outs have little different impact than the free Hampton Downs apartment owners (and friends).

I think both the drivers and spectators would like to see the V8s at Hampton Downs so it would be great if something could be sorted.

BTW - I have no affiliation with the Hampton Downs owners but have raced at all the North Island tracks and it does seem a pity that such a great drivers track is not utilised.

Roger,
dont want get into a public debate on the facts, because your comments are well meant, and I think by and large we are on the same page.

However I think your analogy with the free tickets, is flawed because those freebies dont get to set up camp in the best viewing area's.

Hampton Downs will be a great circuit once its lengthened, however as I have said before, Pukekohe trumps it, purely from a commercial proposition.

At the end of the day the return on investment and the low weather risk Pukekohe offers, means it will always be favoured, by promoters, over Hampton Downs, and that has nothing to do with MSNZ, as the Franklin [horse] Racing club, the tracks owners, are in no way affiliated to MSNZ.

As also said, I have no great love of MSNZ, but simply want to be fair to all parties.

Mark Petch.
CEO NZV8's LTD.

[Oreti kid]

Hamilton City Council backs V8s

Posted On: Friday, 17 December 2010

Hamilton Mayor Julie Hardaker has confirmed Council’s commitment to V8 Supercars Australia and its promotion of the V8s in the city next year.
Ms Hardaker says the recent publication of the cost of the V8s and the fact that it is much more than Council and ratepayers would have wanted should not detract from the fact V8 Supercars Australia is now behind promoting and managing the event in Hamilton.
“As well as being owners of the international series, V8 Supercars is very experienced at successfully running individual rounds in a number of Australian cities and it is good news for Hamilton that they will be fulfilling the same role here. I have found them very professional to deal with and they are committed to a successful event in Hamilton.”
V8 Supercars took over the promotion and management of the event this year and the financial risk that they are undertaking including the commitment to spend more than $1m on the major world class entertainment for 2011 for race fans and locals alike, underlines the level of support that they are making not only to the event but to the people of Hamilton and New Zealand as a whole.
“Nearly 70 per cent of V8’s $10m budget is spent on people, suppliers and the retail community in the Waikato region which represents an enormous financial shot in the arm for our region, especially in these economic times where many businesses are finding it challenging.”
Ms Hardaker said it is important for the people of Hamilton to support the 2011 event. “I urge all residents and businesses to get behind this unique Hamilton event and ensure it’s a successful event for our city. The new Rock n Race format will see bands ZZ Top and Good Charlotte perform concerts and I hope that Hamiltonians take the opportunity to attend.”
April’s event is the third round of the 2011 International V8 Supercars Championship and attracts a massive global television audience.
Tickets for the ITM 400 Hamilton on April 15-17 can be purchased from Ticketek agencies or by calling 0800 TICKETEK.

[Mark Petch]

Originally Posted by Oreti kid

Hamilton City Council backs V8s

Posted On: Friday, 17 December 2010

Hamilton Mayor Julie Hardaker has confirmed Council’s commitment to V8 Supercars Australia and its promotion of the V8s in the city next year.
Ms Hardaker says the recent publication of the cost of the V8s and the fact that it is much more than Council and ratepayers would have wanted should not detract from the fact V8 Supercars Australia is now behind promoting and managing the event in Hamilton.
“As well as being owners of the international series, V8 Supercars is very experienced at successfully running individual rounds in a number of Australian cities and it is good news for Hamilton that they will be fulfilling the same role here. I have found them very professional to deal with and they are committed to a successful event in Hamilton.”
V8 Supercars took over the promotion and management of the event this year and the financial risk that they are undertaking including the commitment to spend more than $1m on the major world class entertainment for 2011 for race fans and locals alike, underlines the level of support that they are making not only to the event but to the people of Hamilton and New Zealand as a whole.
“Nearly 70 per cent of V8’s $10m budget is spent on people, suppliers and the retail community in the Waikato region which represents an enormous financial shot in the arm for our region, especially in these economic times where many businesses are finding it challenging.”
Ms Hardaker said it is important for the people of Hamilton to support the 2011 event. “I urge all residents and businesses to get behind this unique Hamilton event and ensure it’s a successful event for our city. The new Rock n Race format will see bands ZZ Top and Good Charlotte perform concerts and I hope that Hamiltonians take the opportunity to attend.”
April’s event is the third round of the 2011 International V8 Supercars Championship and attracts a massive global television audience.
Tickets for the ITM 400 Hamilton on April 15-17 can be purchased from Ticketek agencies or by calling 0800 TICKETEK.

Its called Spin, and the fact is that the Hamilton City Council and their ratepayers will never see a dollar of profit.

If the Mayor and the Council acknowledge that to the ratepayers, I would not have an issue with Hamilton spending million's of dollars in promoting itself, its just the profit justification, and secrecy that gets up my nostril's.

[Just Do It!]

Pull your NZV8 category as a protest then. It's pretty straightforward really. Take a stand!

[Mark Petch]

Originally Posted by Just Do It!

Pull your NZV8 category as a protest then. It's pretty straightforward really. Take a stand!

JDI,
my personal feelings about the value to the sport [I love] of Street races as alternatives to permanent race tracks, has nothing what so ever to do with my stewardship of NZV8's.

This year we NZV8s/VEEGA requested that Hamilton be an official round of our NZV8s Championship. I am on record as voting for that recommendation.

I just hate seeing all that money, quite literally, go down the drain year after year.

Mark Petch.
CEO NZV8's

[GTRMagic]

More Here

Given that the article lives at Wordpress, it might just go 'poof'.. so here we go...

Originally Posted by The Article

Council horror at real Hamilton NZ V8 costs

Shocked Hamilton city councillors have called in external auditors to review how the city’s V8 Supercars race has cost ratepayers more than $30 million.

Hamilton Mayor Julie Hardaker yesterday confirmed the cost of the annual V8 Supercar race had ballooned to $27.4m over the three years the city has hosted the event.

Hamilton 2010 Report

The Waikato Times understands the council paid confidential hosting rights of more than $4 million from its events sponsorship fund. The new figure is approaching three times the $11m figure councillors claimed they had previously understood.

The 27.4m is made up of $17.98m for set-up costs, $2.9m for related costs, $5.1m for operational costs and a $3.5m cost to transition the event to a new promoter, offset by $1.5m in revenue.

The spreadsheet outlining V8 costs also revealed the council had spent a further $3.5m to reimburse Hamilton suppliers left out of pocket by former V8 promoters Caleta Streetrace Management. The council penned the new deal in May, which councillors had been told was to cover transition costs from the old promoter to the new one, as part of its new agreement with V8 Supercars Australia.

The new contract also cost the council another $130,000 and $85,000 for the cost of providing Seddon Park for two music concerts – ZZ Top and Good Charlotte – which will be held at next year’s event.

Councillors yesterday voted unanimously to appoint a lawyer outside of Hamilton to investigate whether council’s processes were flawed. The review will go back to the first business case study presented to the council in 2006.

Hardaker, who revealed the full costs of the event as part of her election promise, indicated she was horrified the council had approved the spend without having all the information in front of them.

“Some councillors have used the words misleading and smoke screens and I think this (review) would lift this up if it needed to be lifted,” she said.

“It’s glaringly obvious it’s made no money.”

Council acting chief executive Blair Bowcott confirmed councillors were not presented such a high level of detail about the event when they voted in April this year to extend the V8 contract until 2017.

The revelation was the first “full and frank disclosure” on the V8s councillor John Gower had seen.

Councillor Roger Hennebry said the council had been misled because he had never been given the real figure when he had asked on numerous occasions for the full cost.

“I know we weren’t given this information. We are now going to be the whipping boys for the media and the public. When we ask how much, we need it straight up.”

Councillor Ewan Wilson’s request for the Auditor-General to review the process was diluted to a request for a ratepayer-funded external audit to see if the process of communicating information to councillors over the event was flawed.

Wilson said he was not on a witch hunt.

“It raises the question about whether this is an orchestrated manipulation of facts.”

He questioned whether council processes were robust enough.

Meanwhile, the mayor’s unveiling of the cost of the V8s showed the council expected to make a $360,000 profit from next year’s event. The total setup costs were $17.97m (contrary to $7.95m infrastructure cost cited in the council’s long-term plan) with the remainder of the money funded from council’s internal cash reserve.

Hefty infrastructure costs in the breakdown included $3.1m on concrete barriers, $2.25m on purchasing the Pit Lane building, $2.4m on Pit Lane ground works and $2.9m on roading.

A further $2.293m was spent on upgrading other rugby fields including $1.813m on Beetham Park due to the Waikato Stadium No 2 ground being given up for the V8s and disruption to Willoughby Park and Fraser Tech Park. The council has also spent $3.75m on operating costs over the past three years.

In contrast only $1.525m operating revenue had been made in the past three years. Hardaker said the city had a contract to host the event for the next four years and needed to support it.

Financials

I tell you what, the accounting standards in NZ must be a little different to those over here.. how some outgoings are classed as 'assets' which would suggest that the asset is usable over a number of periods, and therefore depreciable, yet by the same token other 'assets' are labour related and may be expensed... not too sure what to make of this

The costs are the costs, unless they are an asset, and then they would have a carrying value, such that it may not be the case that the $27.4m bandied about may be both erroneous & misleading. But why let the facts get in the way of a good story.

The only area of conjecture that pops out here (other than the um.. interesting book keeping..) is there was a transition cost involved in transitioning the event management contract from the previous provider and VESA Events. Again, the facts relevant to this are not detailed here, or anywhere else I have hunted down on the web, but there is no reason to think there is an issue here.. very easy to point the boning rod when facts are in short supply as the rhetoric floods the discussion.

I presume NZ has its version of an Auditor General's department. Some insight from someone who knows numbers without having to take their shoes and socks off would be nice

[peckstar]

actually the only thing that pops up as interesting is why weren't the counsillors aware of the costs.

which is after all what the whole audit is truing to achieve.

The costs are in line with other street circuits,

but some how there has been a communication breaksdown

anything else that people are saying is just mudslinging and usually by people with an agenda (ie the whole meathead argument of i dont like street races or the money would be better spent on permanent circuits)

[Holly Wood]

Originally Posted by GTRMagic

More Here

Given that the article lives at Wordpress, it might just go 'poof'.. so here we go...

For the record, the article was actually written by Waikato Times journalist Nikki Preston.

http://www.stuff.co.nz/waikato-times...-real-V8-costs

I had a look around the wordpress site you've linked to, and most of the content (words and images) appears to have been stolen from elsewhere without attribution. Interesting hobby...

[D.R.T.]

Originally Posted by peckstar

The costs are in line with other street circuits

And thats the problem - added to the lack of income.

Originally Posted by peckstar

ie the whole meathead argument of i dont like street races or the money would be better spent on permanent circuits)

I know, it's just a selfish and elitist argument isn't it

[peckstar]

No its not DRT, thats not the problem. the problem is a lack of communication, its in GTR's post above (quoting The Article" The whole audit that is going on is regarding that, nothing to do with the actrual money spent

and really in your case, yes it is selfish (you can decide if that is a bad thing)

[Mark Petch]

Originally Posted by peckstar

actually the only thing that pops up as interesting is why weren't the counsillors aware of the costs.

which is after all what the whole audit is truing to achieve.

The costs are in line with other street circuits,

but some how there has been a communication breaksdown

anything else that people are saying is just mudslinging and usually by people with an agenda (ie the whole meathead argument of i dont like street races or the money would be better spent on permanent circuits)

Dear 'peckstar'
I have been called many things, but "meathead" is not one of them.

Still you are entitled to your opinion and I respect that.

Mark Petch.
CEO NZV8's Ltd.