​SCRAMP And ISC May Run Mazda Raceway Laguna Seca As Partners

​SCRAMP And ISC May Run Mazda Raceway Laguna Seca As Partners

© 2016, Roadracing World Publishing, Inc.

The Sports Car Racing Association of the Monterey Peninsula (SCRAMP) and International Speedway Corporation (ISC) have reached an agreement to join forces and seek a deal with Monterey County, California, to run Mazda Raceway Laguna Seca together.

In 1957, SCRAMP built what is now known as Mazda Raceway Laguna Seca on land deeded to Monterey County by the U.S. Government, and SCRAMP (a non-profit organization) has operated, maintained and improved the racetrack for 59 consecutive years under a concession agreement with the County.

In 2014, the last long-term concession agreement between SCRAMP and the County ended, and the County started seeking out alternatives to simply renewing its agreement with SCRAMP.

While it continued letting SCRAMP manage Mazda Raceway Laguna Seca under a month-to-month concession agreement, the County started entertaining offers from other interested parties. One interested party was ISC, a publicly traded company that operates several speedways and which is run by some of the same people who run NASCAR. After a 90-day due diligence period in 2015, ISC opted not to submit a formal proposal to the County to manage Mazda Raceway Laguna Seca.

Now, SCRAMP and ISC have entered into a “memorandum of understanding,” according to Mazda Raceway Laguna Seca CEO/General Manager Gill Campbell, in order to run the track jointly under a concession agreement with Monterey County.

“What we are proposing is that we as SCRAMP remain as the event management company and that ISC would come in as the umbrella company,” Campbell told Roadracingworld.com Tuesday. “They [ISC] would be the ones who would actually have the concession agreement, and we would continue doing what we do best, which is run events.”

Campbell said that the global recession hurt fan attendance at Mazda Raceway Laguna Seca events and the addition of competing MotoGP events at Indianapolis Motor Speedway and Circuit of The Americas caused revenue from corporate sponsorships and hospitality sales to decline. While the track has been going through what Campbell calls “slow but stable recovery,” she added that uncertainty over SCRAMP’s future at Mazda Raceway Laguna Seca has prevented the group securing more sponsorship and funding to move forward with improvements at the facility.

An article published May 20 in the Monterey Herald gave a snapshot of SCRAMP’s financial situation based upon a 2014 financial audit that SCRAMP provided to the County earlier this month, but Campbell downplayed how SCRAMP was portrayed in that article.

“This is a 2014 financial audit. It has nothing to do with our current financial situation. It was a year and a half ago,” said Campbell. “We certainly have long-term loans with the bank, about $78,000. We have other loans totaling about $1.2 (million) and we are in negotiations with the county as to how much we actually owe them for rent and rate fees. And that’s an ongoing negotiation and it gets very complex. I’ll give you an example: When the track is rented all of the money goes straight to the county. We get 20% of that, but the county hangs on to it. So there are days when they owe us money, and there are days when we owe them money. So it goes back and forth a lot. So negotiations are ongoing as to a settlement on what is actually owed.”

The article went on to say that SCRAMP was using naming rights sponsorship money designated for infrastructure improvements to cover operational expenses and did not have the funds necessary to make the improvements stipulated in the naming rights sponsorship deal.

“Let me explain how that works,” said Campbell. “In the Mazda agreement it states that ‘monies equal to 70%’ of the Mazda naming rights sponsorship have to be spent on infrastructure improvements. In our contract it stated that we had to commit to doing those improvements by April 24, 2014, which we did. We committed to building a new start/finish bridge and restrooms and showers in the paddock.

“Part of that contract is that the county has to approve those projects. The county has never approved those projects. Also, when I asked [the County] what projects will you approve, the answer was basically, when we agree on a long-term [concession] agreement we can talk about that. Also, we have been on a month-to-month contract with the county, so frankly, being able to do that infrastructure [improvement] is pretty much impossible when you’re on a month-to-month [agreement]. We have been in regular communication with the County. We’ve been working very closely with them. There are no surprises for anybody who is intimately involved in this.”

Now, says Campbell, SCRAMP and ISC are currently waiting for Monterey County to issue a Request For Qualifications (RFQ) so they can formally start the process of moving toward a new, long-term concession agreement. According to Campbell, the County may act based upon the RFQ or may also issue a Request For Proposal (RFP) before offering a new concession agreement.

In the meantime, Campbell, SCRAMP and the staff at Mazda Raceway Laguna Seca are trying to “survive. This facility needs some TLC and it needs somebody with more resources than we have at our finger tips. If we can win the bid with the County where we have the best of both worlds, ISC’s resources and our knowledge and event management capability, we’re all in a good place.”

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