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Baltimore Grand Prix management contract approved by Board of Estimates

The city’s Board of Estimates voted 3-2 Wednesday to approve a contract with Downforce Racing LLC for the right to run the Baltimore Grand Prix for the next five years.

City Council President Bernard C. ‘Jack’ Young (left) and Mayor Stephanie Rawlings-Blake listen to a presentation from American Le Mans Series President Scott Atherton at Wednesday’s Board of Estimates meeting.

Comptroller Joan M. Pratt and City Council President Bernard C. “Jack” Young voted against the contract.

“Given the past experience of this event and looking forward, I am more in tune that this event be successful for the city and the citizens not be burdened with additional expenses,” Pratt said. “Therefore I am opposed to this item until I receive definitive answers regarding the city’s true financial commitment and the items that I’ve aforementioned.”

In addition to the costs associated with the event, the comptroller said she was concerned that minority and women’s business contract goals are met, and that the organizers provide training opportunities for area automotive schools.

“I know that sometimes we have not met our MBE goals,” she said.

Watch video from Wednesday’s meeting

Pratt said her office only received a copy of the contract on Friday and has not seen any cash flow statements or projections.

“[We] would have appreciated being involved in the negotiations from the very beginning instead of receiving the contract after the deal had been made,” she said.

Lester Davis, a spokesman for Young, said the council president hoped that “moving forward, the various safeguards will in fact work as intended and that the risk to the taxpayers in Baltimore be minimized. It was never a question of if the race could be successfully revived. His point was that … you would touch a larger group of citizens if you focused your energy on other things.”

Dale Dillon, one of the managers of Downforce Racing, said he understood where Pratt and Young’s opposition was coming from, but hoped “to sway them in the future.”

Mayor Stephanie-Rawlings Blake, who has long touted the economic benefits of the Baltimore Grand Prix, said she did not have hesitation about going forward with the contract, even though two of the city’s top officials opposed it.

“Honest minds can differ,” she said.

In addition to the mayor, City Solicitor George A. Nilson and Director of Public Works Alfred H. Foxx voted to approve the contract. The mayor controls their votes, since they are mayoral appointees.

Downforce Racing is comprised of Dillon, Felix Dawson and Dan Reck. Dillon, an Indianapolis-based contractor who has organized grand prix races in St. Petersburg, Fla., and Toronto, was brought in to manage last year’s event in the final weeks.

Dawson and Reck are the founding partners of Baltimore-based investment firm Wilkes Lane Capital. Dawson was an investor in last year’s event.

The comptroller’s office will continue to pursue financial records for the event, said Walter Horton of the city’s real estate department, which along with the Audit Department is overseen by the comptroller.

“Having the Audit Department involved in critiquing the financial reports is going to be critical to the success of this project, and I think we are going to push forward and get copies of those for analysis,” he said.

Downforce is required to submit monthly financial reports to the mayor and City Council.

Horton, who also raised concerns about anticipated construction costs for this year’s event, said he was not satisfied with the answers he received at the meeting.

Officials said aside from repairing cracks, the road work done last year should last for about 15 years. The city spent nearly $7 million in federal and state money to prepare downtown roads for the inaugural race.

“There’s going to be some outlay of cash, and I don’t think they truly answered the question, especially that one related to the expenses,” Horton said.

There were two officials protests filed against the contract, one from Arnold M. Jolivet, president of the Maryland Minority Contractors Association, and another by Kim Trueheart, a Baltimore resident.

Jolivet, who ultimately withdrew his protest, said he believed “very strongly that the city should go the second mile in encouraging or facilitating, or even requiring, ventures like this to have minority, and particularly African American equity ownership,” he said. “This is a city which is largely African American. The African American community needs to be involved in projects like this.”

Trueheart, however, was not swayed by the comments. More than a dozen people, including the three managers of Downforce, as well as officials from Visit Baltimore, the Baltimore Development Corp., IndyCar and the American Le Mans Series, and community representatives, all spoke in favor of the contract.

“I want facts. I want data. I want transparency,” Trueheart said. “I’m a process person and I understand that the process last year didn’t work very well to engage neighborhoods and communities, so there’s room for improvement. I don’t know that you’ve improved anything in the process from last year.”

The Baltimore Grand Prix became fraught with controversy after previous organizer Baltimore Racing Development LLC left the city with about $1.5 million in unpaid bills and accrued a total of about $12 million in debts, including to vendors who were never paid. The city terminated its five-year contract with BRD at the end of 2011.

Still, Reck said the response they have gotten from the business community has been positive,

“I can assume that there still must be some misconceptions that are lingering, but we’re not seeing them,” he said.

Scott Atherton, president of the American Le Mans Series, said he expects a higher level of corporate involvement for this year’s Grand Prix.

While last year many sponsors were involved at limited levels, “anybody that fell into that category is coming back this year with an increased level of involvement,” he said.

He said that, ideally, the organizers will choose someone “like a financial service company or insurance company” as a title sponsor.

“Someone that is not directly involved with a certain team or manufacturer,” he said.

Last year’s organizers failed to attract a title sponsor.

“‘Baltimore’ was the thing you anchored the event with,” said Terry Hasseltine, director of sports marketing for the state.

“But, you need a title sponsor. It helps you financially; it helps you create some additional deliverables associated with the event. It connects the corporate community with the event,” he said. “The tricky part is how you incorporate that in the brand identity.”