Smith: Track deal violated
When will he be repaid for road upgrades? He says 2-3 years. Officials say maybe 40 years.
09/09/2008 12:00 AM
09/09/2008 6:02 AM
Lowe's Motor Speedway owner Bruton Smith lashed out again at Concord and Cabarrus officials Monday, saying he no longer trusts them and that someone is trying to undo his $80million incentives deal.
The billionaire also said his lawyers are looking into potential fraud, but he declined to elaborate.
Smith insisted that the deal means his company must be compensated within two to three years for fronting the cost of major road upgrades around the Concord track.
But about three weeks ago, local officials said it could take up to 40 years to pay back most of those costs.
Smith, 81, said that timetable had not been discussed before. Anyone who says otherwise, he said, “is a liar and a cheat.”
“I'm being the victim all over again,” he said Monday. “Somebody in Concord is trying to undo what they agreed to … We're not going to remotely consider anything other than two to three years.”
He said he can't move the track – which he threatened to do last year following the initial feud with city officials – but he could take other steps, which he declined to discuss.
“To expect the city and county to (reimburse) that amount of money in a two- to three-year period is unheard of,” county commissioners Chairman Jay White said. “I certainly didn't obligate the county for that amount for that period of time.”
Given the governments' attitude, Smith said, he no longer feels bound to invest $200million in upgrades at the speedway. That was the amount city and county leaders expected Smith to put into the speedway as part of last November's deal.
The latest fireworks are a renewal of a high-profile fight last fall that began after Concord blocked Smith's plans to build a $60million drag strip across from the speedway. Smith threatened to move the speedway, and also said he felt victimized by the city's stance.
Plenty of money is at stake. The speedway generated $169million in tourism spending in Cabarrus County in 2006, and Smith's drag strip will hold its inaugural event this weekend, generating an estimated $10million for the local economy.
In a memo in November, the city and county agreed to secure $80million in incentives, mainly for road improvements. Smith agreed to keep his speedway complex in Concord, build the drag strip and proceed with $200million in speedway upgrades.
The memo's only time reference involved the city and county taking up to three years to secure $20million of the money from the state or raise the money themselves.
Longtime Smith friend John Kennedy was one of the liaisons Smith chose to act as a go-between in negotiations last year. Kennedy said Monday he was unaware of any 40-year discussion, and that he took the spirit of the November memo to mean that the city and county would compensate Smith within three years.
The governments delivered the formal incentives package to Smith last month. It included $60million in incentives to be reimbursed to his company, Speedway Motorsports, through incentive grants equal to 85percent of the annual local taxes generated by the new projects.
Such grants typically are for much smaller amounts and last up to five years. But in this case, the county said, incentives could take as long as 40 years to complete.
White and Concord Mayor Scott Padgett said they were negotiating in good faith.
When asked about fraud, White said, “I can say some colorful words, but I'm not going to get sidetracked from the point” that the city and county would not agree to pay such incentives over such a short period.
Padgett declined to say whether a 40-year scenario was ever discussed. White said no one had approached the governments about paying incentives over two to three years.
Smith also said he objected to other parts of the incentives deal the governments wanted to make.
Smith said he would not be bound to have SMI operate the complex in Concord for 40 years, as the county and city had sought.
And he said he would not commit in writing to holding three top-tier NASCAR races at the speedway annually, which the city and county also wanted.
The speedway currently hosts three such races a year.
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