Hosting America’s Cup Cost the City $5.5 Million

Photo: Sarah McClure

Photo: Sarah McClure

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America’s Cup has its perks: 700,000 visitors to the city of San Francisco, money being put into the local economy, international media coverage and some good old-fashioned patriotism surrounding a prestigious sport like the regatta (up there with the likes of the Olympics and the World Cup). The downside to competitive sailing?

The cost to host such an event, including adding improvements to the waterfront infrastructure, left San Francisco taxpayers with a deficit of $5.5 million. Mayor Ed Lee said in a statement, the Cup “showcased our beautiful city to the world and brought thousands of new jobs, long-overdue legacy waterfront improvements, international visitor spending and a boost to our regional economy.”

But not everyone is a supporter. “A $5.5 million deficit, all for a yacht race for billionaires,” Supervisor John Avalos told the San Francisco Chronicle. Avalos maintained that the money could have been better spent elsewhere to improve city services.

Mayor Lee has until December 22 to propose a preliminary proposal to host the next Cup. What do you think? Is hosting competitive sailing an investment or a liability for our city?

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13 Comments

  1. nutrisystem

    So, in effect, the taxpayer who scrapes paint for $15/hour is PAYING billionaires, hotel owners and restaurant owners.

    This is a classic Ed Lee move. He is a wholly owned subsidiary of the robber-baron class.

    Gotta say, the man’s got chutzpah – earnestly pretending to care abut the regular people when the TV cameras are on him, then 5 minutes later he’s giving billionaires handouts!

    • John

      Lee has a 73% approval rating according to today’s poll in the Chron, so evidently a majority disagree with you.

      And of course this alleged “loss” doesn’t include all the incidental spending by those 700,000 visitors to the race.

      Still, if hopelessly loony lefty Avalos says it, it must be true, right?

      • 73%. That’s what the Chron said, all right. A pity that number doesn’t actually appear in the poll they cite.

        (The article’s at San Franciscans ambivalent on future, poll finds; the poll is at University of San Francisco Affordability and Tech poll. Not that any of the numbers can be taken to reflect what San Franciscans actually think, because it’s another “online poll”. Even the folks who conducted it don’t have any faith that it’s representative: “Demographics matched city voters pretty well,but the survey is weighted on housing tenure”.)

        If the leaning-right Chron pegs the loss at $5.5 million, the sensible thing to wonder is how much of an UNDERestimate that is. Note that the Chron came up with the number, and then contacted Avalos for a comment.

        • John

          The 73% approval number sounds about right to me and most folks I speak to. The support for him is very broad and deep.

          The last poll had Lee at 65% so it shows a modest uplift in his support which isn’t surprising given the America Cup success, the Twitter IPO and a boom in well-paying jobs.

          The point with something like the Americas Cup is that many of the benefits are indirect, partly caused by the extra spending by all those visitors, and partly due to an elevation in SF’s profile around the world.

          Finally, if the Chron is “right leaning”, then why did they ask the most left-wing Supe on the board for a comment? And the guy who the voters convincingly rejected in favor of the pro-jobs candidate, Ed Lee?

          • I just checked. 75% of the people I asked think you are actually a giant powder blue hedgehog. My anecdote’s as valid as yours. Similarly, if you’ve got a cite for that 65% number, I’d like to see it; there are lots of broken things masquerading as statistically valid polls out there, but maybe the one you’re thinking of actually is a good one.

            Demonstrating that there was a knock-on effect from tourists who showed up specifically for the America’s Cup is going to be tricky. San Francisco is a standard tourist destination; it’s not like people don’t show up here every year regardless. We won’t know if this was a particularly good year for tourism until all the numbers for 2013 are in; we can revisit the question then. (2011 and 2012 numbers: SAN FRANCISCO TOURISM – VOLUME, SPENDING AND CHARACTERISTICS, 2012.) Similarly, whether hosting the race had a positive or negative effect on San Francisco’s “profile” isn’t clear. It might have been a win– it’s possible– but it’s also possible it just meant more people associate the City with fools wasting money on pointless toys. Failing some sort of actual study, we don’t know which, if either, applies.

            And finally, I figure the Chron called Avalos for a comment because he could be counted on to give good sound bite– which journalists from all over the political spectrum want.

          • John

            Stephen, a 65% approval number for Lee is hardly a shock given that 50% voted for him over Avalos last time out, and SF has added a lot of jobs since then.

            If you have a poll showing a much lower number, you’d have shown it by now.

            While I struggle to believe that you think all 700,000 people who attended the AC would have come here anyway as regular tourists.

            I’m proud that we successfully hosted the AC and even if it did cost a few million, which I doubt, it was worth it.

          • John

            Sorry, Stephen, I meant 60% voted for Lee over Avalos.

            Given the fabulous economy we’ve been having, approval figures of 65% and 73% seem right in line with that.

          • If you’re going to presume to call me by my first name, could you spell it correctly? A mere detail, I understand, but we reality-based people thrive on such.

            I don’t think any statistically valid poll on Lee’s been attempted, since polling correctly (rather than doing some half-baked online survey) is really expensive. Thing is, you’re the only one basing arguments on Lee’s approval rating. I’m just pointing out that you don’t have the data to back up your claims.

            The thing about 700K tourists for the America’s Cup only flies if all the hotel rooms and such would have gone unfilled were it not FOR the America’s Cup. That’s a good model for a city that doesn’t get tourists outside special events– but it’s not a good one for San Francisco. Nor do we know if the mix we got in 2013 spent more or less than the usual lot of tourists we get– and we won’t until later. (In the event anybody else is reading any of this still: there’s an interesting article specifically about the America’s Cup haul at America’s Cup: Purported $364 Million in Revenue Still Comes With Big Question Marks. It notes that the boosters were predicting 2 million tourists rather than 700K– but that doesn’t mean we ended up short 1.3 million tourists! Replacement tourists indifferent to the America’s Cup showed up right on schedule.)

            Going back to Lee: you’ve clearly built up a narrative where the job gains the City has seen recently should be credited to Lee. It’s a possibility, but this is why I’m not enthusiastic about it:

            First off, in the late 1990s and early 2000s, we had a tech boom and bust under mayors with policies that (relative to Lee) weren’t particularly “pro-business”. Hence, tech booms can happen without a “pro-business” executive. This leaves me disinclined to credit a “pro-business” mayor for a tech boom. Indeed, we can see Texas over there scrambling and begging in pro-business ways that would make Lee look like Fidel Castro, and they’re not getting anything like a tech boom in response– so it’s not just a question of “Be nice to the businesses, and they will come.”

            As far as the City’s job numbers go, remember that the national economy crashed in 2008, and the nation’s been slowly dragging itself out of the subsequent recession. San Francisco, like the rest of the country, has been recovering from a really miserable decade. Of course every year has been better than the last; the whole country has been climbing up out of a deep hole.

          • John

            Stephan, I apologize for mis-spelling your name. I imagine that happens a lot as it is a highly unusual spelling of a very common name.

            I feel sure that you do not expect me to address every point that you made in that very long post, so i will restrict myself to stating that Ed Lee is a wildly popular mayor in SF (do you live here?) which is widely attributed to his lack of ideology, his can-do and pragmatist approach, his clear pro-jobs policies and the fact that SF is just completing it’s 4th year of bang-on growth.

            I’m really not clear on why you are so down on the AC triumph but it is important that you know that most folks here feel honored and privileged to have been a part of it, and the way it put SF firmly on the map.

          • No worries on the name thing. And since you asked: this is my nineteenth year in the City.

            I have no doubt but that Lee’s popular enough with the people who voted for him– but if you’re really convinced that he’s “wildly popular” in the general population, you need to get out more. This isn’t even to cast aspersions on Lee; I wouldn’t characterize any San Francisco mayor as being “wildly popular”. We’re too contentious a city for that; even Willie Brown had no shortage of foes.

            I’m down on the America’s Cup silliness precisely because it wasn’t a triumph; the people who said that it would draw two million tourists and produce $1.4 billion in spending were proven wrong. Not just a little wrong– badly wrong. Indeed, the reality was so feeble, the City ended up losing $5.5 million of its own money– which is what the headline is about in the first place.

          • John

            OK, Stephan, so now we know what you don’t believe in, why don’t you tell us what you do believe in?

            To the other, I talk to a very wide range of people. I inhabit no silo or bunker full of like-minded people. If Lee’s approval rating isn’t 73%, it isn’t far off either.

            That doesn’t mean he doesn’t have foes, and in fact those who oppose him make more noise than those who support him. But that doesn’t alter the numbers, and I am highly confident he will win a second term by a landslide.

      • Z

        If the mayor wants to maintain his 73% approval rating amongst the 553 people who participated in this poll, it might be a good idea for him to pay attention to a few of the other figures cited:

        -70% of the respondents favor an active government approach in making the city more affordable.

        -68% feel that cost of living is a problem. 40% say it’s a big problem.

        He won’t win in a landslide if these issues aren’t addressed.

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