The 2008 Rexall Edmonton Indy, one of the city’s hottest summer events, lost millions of dollars despite rave reviews from racing fans.
A report released by Northlands yesterday showed the races at the City Centre Airport last summer recorded an operating deficit of $5.3 million.
The report also indicated the city has committed to financially backstop any losses or share in any profits from the event for three years.
Northlands blamed the loss on the time crunch they had to promote the event when it switched from Champ Car to the IndyCar Series.
Still, Northlands remains confident that the event will continue to be a must-see event for Edmontonians.
“As a community-based organization we see great value in building an unrivaled international event for Edmonton, and we have a plan to ensure the long-term financial sustainability of this race,” Northlands president Ken Knowles said.
Mayor Stephen Mandel said the economic spinoffs and worldwide exposure make it worthwhile for the city to cover the $5.3-million loss, saying Northlands did a remarkable job despite the late start. He plans to ask the federal government for help in the same way it offered financial assistance to Montreal’s failed bid to retain its Formula One race.
“If you’re going to give money to one city for an event, why wouldn’t you give it to another city for the same event?” he asked
The events are indeed similar, though F1 is recognized as the pinnacle of open-wheel auto racing. The IndyCar series is now the only North American based open-wheel circuit and Edmonton is one of only two Canadian stops on the 17-race schedule, immediately following a street race in Toronto.
“The real issue here is this is an event that can take Edmonton to the next level,” Bouma said. “It’s going to take time and investment to build it, but this has real stature to it. We’ve had one year at it. Let’s let it grow.”
Coun. Ed Gibbons, who sits on the Northlands executive, said the city’s ongoing financial commitment is worthwhile because of the economic impact of the race on Edmonton and Alberta, which was determined to exceed $80 million.
“It’s an $80-million response in business. You never want to lose money, but at the same time, the city did well with it and will continue to do well with it,” Gibbons said.
“I’m quite willing to stand up for it and say I really believe Northlands came to the table when we needed somebody there. I really have a lot of faith in them carrying forward.”
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