SCRAMP awarded new Mazda Raceway deal
Three years of twists and turns in the search for a new track management solution at Laguna Seca have resulted in a return to its first and only management team.
Monterey County's board of supervisors, which controls the land that contains the sprawling park and its renowned 2.2-mile road course, has ceased its efforts to replace the non-profit Sports Car Racing Association of the Monterey Peninsula (SCRAMP) organization.
With the conclusion of that search, the county has entered into a three-year agreement with SCRAMP. SCRAMP's tenure overseeing Laguna Seca, which began in 1957, will continue through at least 2019.
The heart of the new contract, which involves a role reversal in financial responsibility between SCRAMP and the county, was made possible through a complete rethink by both parties on how to move forward in a new and positive manner.
"We have been working very closely with county staff over the past several months to develop a plan that builds upon this iconic facility's heritage of delivering significant economic impact to the Central Coast," said SCRAMP president Michael Smith.
"We will celebrate this heritage throughout the year with 60th anniversary celebrations, culminating in a Racing Through the Decades feature at the Rolex Monterey Motorsports Reunion in August."
The path to a reenergized relationship between SCRAMP and the county involved years of pressure and discomfort.
Led by former supervisor Dave Potter, an unsuccessful attempt to server ties with SCRAMP and partner with the NASCAR-affiliated International Speedway Corporation (ISC) was brought to light in 2015. In 2016, a renewed effort to replace SCRAMP led to the formation and emergence of two new management options, the Friends of Laguna Seca (FLS) and the World Automobile Championship of California (WACC), where the county placed expectations for its next managers to independently fund long-overdue property-wide upgrades.
SCRAMP, which aligned itself with ISC, also submitted a proposal to earn a new management contract, but the FLS, created by a powerful group of locals which promised to spend tens of millions to improve the ageing facility, was ultimately chosen by the board in October.
The management change process came to a head when the board and FLS failed to come to terms. From comments made by the board, it was learned the FLS group had assembled the equivalent of investment promises from its numerous backers, rather than the physical possession of tens of millions of dollars the county expected to have lavished upon Laguna Seca.
Without that big infusion of external cash, the county was unable to reach a concession agreement with FLS, which left the property without a management team as 2017 approached.
After reopening its search when the FLS opportunity fell through, and with Potter's time on the board coming to an end, his replacement, supervisor Mary Adams, turned a new page and reengaged with SCRAMP.
"I think this is good," she told the Monterey Herald. "This clears things up. But it seems like a lot of time and resources were spent to reach this point."
Smith, quoted in the same Herald story, spoke to a more positive relationship with the county after replacing its month-to-month contract under Potter's reign to the new three-year deal spearheaded by Adams.
"There's a different atmosphere now," he said. "This is the most enthused myself and the (SCRAMP) board of governors and staff have been in a long, long time. It's a good win-win for everyone."
Under Potter's previous plan, Laguna Seca's viability hinged upon the next facility manager doubling as an angel investor willing to sink tens of millions into a property it did not own. That plan, which relied upon charity rather than a solid long-term business structure, was immediately abandoned by his successor.
From the work recently carried out by Adams and Smith and their respective teams, the new agreement shifts the long-held expectations for SCRAMP to generate all of the income, pay for operating costs and track upgrades, and deliver a meaningful profit to the county at the end of each year over to the board.
With Adams and Smith focused on untangling more than a decade of messy financial agreements that left both parties frustrated and underwhelmed, the formation of a new agreement began with a top-to-bottom review of all income sources and expenses - some that had nothing to do with SCRAMP - to create an accurate budget forecast.
That review, hailed by insiders as a revealing and helpful exercise, determined the best solution would be to place the county in charge of the income and concessions taken in by Laguna Seca. SCRAMP, which was more than pleased to shift that responsibility to the board, will be paid a straight management fee for its services. By completing a joint and thorough financial review, and streamlining and simplifying their roles, an initial surplus of up to $3 million per year is expected to be generated, with some of those profits going directly into improving the facility.
The fresh contract, financial approach and revised responsibilities between the SCRAMP and the county should usher in a new era for one of North America's most beloved motor racing circuits. The peaceful and progressive resumption of the relationship between both sides should also ease the awkward tensions that have cast a shadow over the track's future.
And while the new agreement does not solve every problem faced by Laguna Seca, the spirit demonstrated by the county and SCRAMP would suggest a collaborative approach to other challenges is possible.
Looking to what's ahead in 2017, seven major racing events are planned from May 12-14 through Oct. 12-15, including appearances by IMSA, Pirelli World Challenge, Superbike World Championship, and numerous vintage racing weekends.