San Francisco officials refer to it as Plan B, but at the same time say the possibility of shifting the proposed facilities for the next America's Cup toward the northern waterfront would save the city and race organizers money while giving spectators a better view of the action.
Of course, that's only if San Francisco is chosen to host sailing's premier regatta in 2013, a decision expected by the end of the year.
The option to move the main public viewing area to Piers 27 and 29 at the base of Telegraph Hill, the site of a planned rebuilt cruise ship terminal, is gaining traction as concerns about the cost of the event simmer.
A report from the Board of Supervisors' budget analyst released Thursday found that the city's direct cost of hosting the Cup would be $42.1 million. There is also an estimated $86.2 million in lost revenue for granting development rights and free leases of up to 75 years for parcels of waterfront property to race organizers, led by billionaire Oracle CEO Larry Ellison.
Besides the $128.3 million hit to city coffers, which could grow to $143 million with financing, the report found that hosting the weeks of races would boost local businesses, pumping an estimated $1.2 billion into the city's economy.
That figure is comparable to an earlier report from the Bay Area Council Economic Institute and Beacon Economics commissioned by Mayor Gavin Newsom's office that found hosting the regatta would generate $1.4 billion in economic activity in the Bay Area and create about 9,000 jobs, with the vast majority of the money and jobs in San Francisco.
"This event will generate a huge amount of business," said budget analyst Harvey Rose, "but that's different from the impact on city government."
Assessing the costs
Newsom's office, though, contends Rose's figures don't factor in $32 million that an America's Cup Organizing Committee of civic and business leaders have pledged to raise to help defray city costs, nor do the projections for development revenue account for the decrepit shape of the piers now under consideration for race facilities.
"You can't even park a (large) truck on Piers 30-32 right now because of the condition it's in," said Rich Hillis, deputy director in the Mayor's Office of Economic and Workforce Development.
The conjoined piers, envisioned as either a public viewing hub or base for team operations, have been used as a parking lot since a developer balked at the cost to fix the piers and abandoned a deal in 2006 to build a $270 million cruise ship terminal and shopping arcade.
The city's proposal to host the contest for the oldest active trophy in international sports calls for Ellison's group to pay an estimated $150 million to rehab Piers 30-32 and Pier 50 and other work in exchange for development rights and free leases for 66 to years on those properties and for 75 years on Seawall Lot 330 at the foot of Bryant Street. It also calls for the city to attempt to get state approval to give Ellison's group outright title to Seawall Lot 330.
Ellison's choice
Ellison's BMW Oracle Racing team, sponsored by San Francisco's Golden Gate Yacht Club, captured the America's Cup in February off the coast of Valencia, Spain, and gets to decide the location of the next regatta.
San Francisco's proposal also calls on the city to assist the organizing committee in securing $270 million in private sponsorships for an "event authority arm" that BMW Oracle Racing and the yacht club have set up to handle the commercial side of the event.
Supervisor Chris Daly, who has blasted Newsom's proposal as a civic giveaway to one of the world's richest men, said the question is about the role of government in public life.
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