Kevin Kalkhoven has said that IndyCar shouldn't be worried about Formula 1 grabbing the Long Beach Grand Prix out from under the Verizon IndyCar Series.

Kalkhoven and Gerald Forsythe, his partner in the Grand Prix Association of Long Beach, have a deal with the city of Long Beach until the end of 2018. Kalkhoven also suggested that the city would not be interested in paying tens of millions of dollars for work to bring Long Beach up to F1 standards, nor in funding the sanctioning fees demanded by Formula 1.

That is all very plausible, but it's not the whole story.

At the start of October last year, the city of Long Beach's purchasing division issued a request for proposals for the Grand Prix of Long Beach, seeking a promoter for "open-wheel auto racing formats (Formula 1 and Indycar only) to provide an annual Grand Prix race event, as well as supporting race-car events and other race-related activities, which, in tandem, create a large-scale, preeminent, world-class race-car event providing family-oriented entertainment and drawing national and international attention to the city."

The goal, it was explained in the document (attached below), was to increase revenues and the race's economic impact for the city, with a focus on maximizing positive exposure in the media and increasing the number of tickets sold -- while, at the same time, minimizing costs, disruption, and the setup and takedown process.

Crowd estimates for the Long Beach Grand Prix clock in around 180,000 for the three-day event. That's not a huge number. Ticket prices are also relatively inexpensive, with three-day general admission tickets going for as little as $85 and companies like Toyota and Tecate offering discounted tickets to people who buy their products. The problem with this is that the crowds tend to consist of residents from the Los Angeles area who come for the day and then go home in the evenings.

Locals attending the race don't visit Long Beach's hotels and restaurants, which means the race doesn't have the economic impact that it would have if people came from out of town. The TV coverage of the race has also been poor, with last year's event getting a 0.37 rating from Nielsen, which averages out to around 402,000 viewers on the NBCSN cable TV channel. In comparison, Formula 1 was in China that weekend and pulled in 275,000 U.S. viewers -- in the middle of the night -- with another 116,000 for the replay on Sunday afternoon. This still creates value for Long Beach, but, as the RFP suggests, things could be improved.

The closing date for proposals was Oct. 28, 2016, but on Oct. 24, the city extended the deadline because of "the complicated regulations governing Formula 1." This clearly indicates a bid for an F1 race. A new deadline was set for Nov. 18, and, by all accounts, this deadline was met.

The proposals are confidential, but it is believed that the Grand Prix Association of Long Beach made a bid to host an IndyCar race, and the World Automobile Championship of California made a bid to host a Formula 1 event.

WACC is led by former Long Beach Grand Prix executive Chris Pook. Last year, the group made a bid to take over Mazda Raceway Laguna Seca. The two bids are now being examined by an evaluation committee, an independent body of representatives of the city, who will then select a promoter.

The terms of the RFP are interesting in how they differ from Kalkhoven's words. The city said that no proposal would be accepted unless the race is "monetarily self-supporting and provides opportunities for the city to participate and share in revenue generation." The promoter is expected to pay for all costs for city services, permit fees and administrative fees, even down to lost revenues from the city's parking lots.

The fees paid to the city are small, with the original contract in 2008 requiring just $520,000, plus indemnities and insurances. This figure was index-linked so it will have increased since then, but it means the race was an incredibly good deal for the Grand Prix Association of Long Beach, which is believed to charge IndyCar around $1.5 million, in addition to collecting all the other revenues. This explains why the ticket prices are so low.

Among the other requirements are that the name "Long Beach" is in the title of the race; that there be very restricted setup and takedown periods for the race infrastructure; and that there be planned activities through the seven-day pre-race period to create a Race Week. The promoters can change the circuit, within the boundaries of the site, but this requires 11 months of notice to the city, and all costs must be covered by the promoter.

Three years ago, Chris Pook, the man who established the Long Beach race in 1975, proposed an F1 return to Long Beach. Pook is famously tight-lipped about his plans, but at the time, he said an event would cost the city nothing, adding that work required to improve the circuit for F1 would be $9.2 million, paid by the promoter. He said the city would not need to pay race fees and would even be reimbursed for all expenses. The only requirement would be for the city to allow the construction of a new two-story pit building on Shoreline Drive, which would then be available for the city to use for other events.

The key point, however, is that Long Beach has yet to decide what to do.

"They have not made a decision yet," said city representative Traci Fitzharris. "The city evaluation committee would have to look at it -- and the city council if the costs involved are beyond a threshold of $200,000."

Given the terms of the RFP, this should not be required.

In F1 circles, many believe the current race fee model is unsustainable because race promoters cannot make a profit from their event. Some governments are happy to pay the high fees demanded and take a loss because a Grand Prix drives economic activity and the city gains a better image through its F1 link. But this means that F1 can only go where money is available, rather than going to markets that are strategically important. If there were no fees, F1 could pick and choose.

One option is for Liberty Media itself to promote its own races by agreeing to deals to take over venues and then generate profits in every way it can. This would include ticketing, advertising, merchandising, food and beverage, in addition to payments from the local authorities keen to have F1 visit.

Liberty Media also controls Live Nation Entertainment, which owns, leases and operates a large number of entertainment venues around the world. It pulled in revenues of $7.24 billion in 2015, with on-site advertising as its prime growth factor. It's largely a music-based company, but it's also the leading festival operator in the world, and its Ticketmaster subsidiary sold more than 530 million tickets to events in 2015. As we have seen in the past, F1 can be combined successfully with music events, and Liberty Media's stated aim of making F1 events bigger -- and more like a festival -- fits with this.

Such a system would be attractive to the circuits because they would make money rather than lose it, while enjoying the prestige that an F1 race can bring to a venue at relatively little cost.

What isn't clear is that if Pook is pushing forward with a plan -- and if he has the backing of Formula 1.

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