Financial filing offers rare glimpse into NASCAR sanctioning stipulations

By Bob Pockrass - Associate Editor
Friday, November 13, 2009
Dover International Speedway's sanction agreement offers some insight into NASCAR requirements for tracks. (David Griffin / NASCAR Scene)

Dover International Speedway's sanction agreement offers some insight into NASCAR requirements for tracks.

David Griffin
NASCAR Scene

AVONDALE, Ariz. – A Dover International Speedway filing with the U.S. Securities and Exchange Commission this week offers an unusually detailed look at the range and scope of NASCAR’s sanctioning agreements, including a $6.055 million fee for the track’s May Sprint Cup race and $5.429 million for its September event.

Dover’s estimated broadcast revenue for the events will be $12.645 million for May and $10.473 million for September, according to the filing. With tracks having to contribute about 27.8 percent of their television revenue to the race purses, Dover’s television revenue pays for $3.51 million of its May purse and $2.91 million of its September purse.

The 2010 sanction agreements, minus the financial details listed on an amendment page, also were filed Thursday with the SEC. The 22-page sanction agreements are general in nature – only a cover sheet lists the date, the track and the promoter (in this case, Dover). Dover, which also owns tracks near Nashville and St. Louis but hosts Cup events only at the Delaware venue, must file the agreements with the SEC because it is these two agreements on which its “business is substantially dependent.” In a previous filing, Dover reported that 70 percent of its total revenues come from its Sprint Cup weekends.

Among the other items listed in the 2010 NASCAR Sprint Cup sanction agreements that Dover filed:

• The track must carry $50 million in liability insurance and $1 million in medical malpractice liability insurance. NASCAR must be listed among the insured. NASCAR must require the TV partner to carry $2 million in general liability insurance ($1 million limit per occurrence) that includes the promoter in that policy.

• A track cannot alter the racing surface by painting, sealing or resurfacing without prior written consent of NASCAR.

• NASCAR can postpone or cancel an event if the promoter does not fix any unsatisfactory racing surface, barriers, fencing, retaining systems, SAFER barrier systems, garage area, pit area, race control area, timing and scoring areas or structures used for broadcast of the event.

• NASCAR says it will attempt to consult with the promoter regarding postponement of events, but the decision to postpone is NASCAR’s.

• NASCAR gets 225 reserved choice grandstand tickets for the race and 200 for qualifying.

• The track must provide 325 parking passes/permits adjacent to or near the garage area for NASCAR and 50 in close proximity to the NASCAR track suite.

• The track must provide two pace vehicles. It also must provide 150 chairs in an enclosed, climate-controlled area for the drivers meeting. It must provide a control tower with air conditioning, heat, 14 chairs (with cushions), phone line and television monitors.

• The track must provide a television booth for at least five people, air-conditioned to 68 degrees. The TV partner also gets 300 tickets plus one luxury track suite. The track also must use “reasonable efforts to cause the title sponsor of the event to buy advertising in the telecasts.” NASCAR requires its broadcast partner to say the name of the race at least once during the opening segment of the telecast and thereafter at least once during each hour of the telecast.

• NASCAR reserves the right to approve or disapprove any advertising or sponsorship in connection with the event.

• The track must have authorization from any musician to play a song over loudspeakers during an event when the TV partner is on the air and there is a chance it would be picked up during the telecast.

• The track must not allow testing forbidden by the NASCAR testing policy.

• The track cannot use NASCAR’s point or money standings to determine the eligibility of a competitor for a non-NASCAR-sanctioned race at its track.

The general terms of the sanction agreements are virtually the same as last year with one notable exception, and it is in the section dealing with the potential default of a promoter.

In that section, an entire graph was added under the provisions of a default:

“If NASCAR becomes aware, through any means, of a possible change in the promoter’s affairs which might reasonably be determined to have a material adverse effect on the organization or conduct of the Event, including, but not limited to, the withdrawal or reduction of major event sponsorship(s), delinquencies or defaults by promoter in payments to other entities, litigation relative to the event, promoter or the facility, failure of promoter to perform under similar agreements with third parties for other events, and so on, then NASCAR may require promoter to take whatever action that NASCAR determines is necessary to insure the successful organization and conduct of the event. Such action may include, but is not limited to, posting a bond, providing an irrevocable letter of credit, and/or providing a financial instrument, or mechanism sufficient to guarantee, in NASCAR’s reasonable discretion, that all financial obligations of the promoter relative to the Event can be met.”

NASCAR officials didn’t immediately comment on whether that clause has anything to do with what happened earlier this year with the Milwaukee Mile. NASCAR has stated that there are unresolved issues concerning the 2009 races in its Nationwide and Camping World Truck series there.
 

Comments

18 responses to "Financial filing offers rare glimpse into NASCAR sanctioning stipulations". Post a Comment.
  1. 1
    Rainier said:
    Nov 13, 2009 at 10:49 AM

    If the track is responsible for the purse as well as providing everything necessary for the race including an air conditioned box for the NASCAR officials, what does NASCAR do with all that money it collects, approximately $11.5 million dollars from Dover alone? If you assume at least a 5 million dollar fee for every race, NASCAR is collecting $180 million in fees per year. Where in God's name does all that money go? Surely it can't cost that much to inspect the cars each week or design the new cars.

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  2. 2
    88_20_42_Fan said:
    Nov 13, 2009 at 11:53 AM

    It looks to me like NASCAR bully's the independant track owners a bit. Rainer, I would assume the majority of that $180 Million is lining Brian Frances Wallet.

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  3. 3
    STP43FAN said:
    Nov 13, 2009 at 1:15 PM

    88 20 42 - that might sound plausible except that more bullying comes from SMI toward independant track owners.

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  4. 4
    Meg said:
    Nov 13, 2009 at 3:16 PM

    At what track was there a bridge that collapsed that a lot of people were walking across when it happened ?? Reading about having a 50 million dollar liability policy makes me wonder if it covered all the claims that were filed in that incident.

    AND there had to be a few claims from Dega when Carl's car threw all that debris into the stands.. How much is your eye site worth ?Only takes one SOB lawyer who could convince the jury that 50 million simply wouldn't be enough.. Where's Sarsie ... she could come up with some good settlement stories for us..* G *

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  5. 5
    Meg said:
    Nov 13, 2009 at 3:17 PM

    Judge rules against fans in Lowe's bridge collapse

    http://sports.espn.go.com/rpm/news/story?seriesId=2&id=2510428

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  6. 6
    mcrealname said:
    Nov 13, 2009 at 4:20 PM

    it's ALL ABOUT THE MONEY people...racing is the afterthought....sad, sad, sad.....OH, this is america, home of the free(AND RICH)...

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  7. 7
    spdbmp said:
    Nov 13, 2009 at 4:54 PM

    Like the Title suggests...
    "Financial filing offers RARE GLIMPSE into NASCAR sanctioning stipulations"

    Yeah, there's a reason we don't get to actually see what the rulebook actually says too! NASCAR is probably not too happy about broadcasting all of their Laundry over the internet - it can only be used against them!

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  8. 8
    kingmrf said:
    Nov 13, 2009 at 4:59 PM

    So why isn't it NASCAR's responsibility to ensure the track owners that there will not be more empty seats than full ones.
    The tracks need fans to help pay their sanctioning fees and the purse and if that isn't there,then neither will the race in a few years to come.
    Look at Rockingham,it was one of the most loved tracks,by the drivers,owners and fans,but with no help from NASCAR,they shut it down.
    The day of the $80 to $150 ticket is over,race fans cannot afford the ticket,the room and the travel expenses and now to see what NASCAR wants for each event will make more people stay home and visit a local short track where in most instances the racing will be better,it's closer to home and more importantly,a family of 4 could attend for the price of just 1 ticket to a NASCAR race.

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  9. 9
    deyanak said:
    Nov 13, 2009 at 5:17 PM

    while on this subject do you know you can't get a copy of the rule book unless you are a car owner...wonder where it all goes...naxcar claims its for the fans..the only ones that really care about the fans are the drivers...think about it....

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  10. 10
    Werner said:
    Nov 13, 2009 at 6:40 PM

    "It also must provide 150 chairs in an enclosed, climate-controlled area for the drivers meeting"...is this the meeting before the race???....at Charlotte the drivers meeting was almost outside...and the meeting i saw at Joliet was in the NW garage...

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  11. 11
    RonSchwalbe said:
    Nov 13, 2009 at 8:16 PM

    150 chairs ??? 43 drivers + 43 crew chiefs = 86 ! Who are the other 64 chairs for ?

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  12. 12
    leftturn said:
    Nov 13, 2009 at 9:01 PM

    RONSCHWALBE--The accountants.

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  13. 13
    jbbigrod said:
    Nov 14, 2009 at 12:27 AM

    YES folks and YOU pay all those millions, billions of dollars each year. NOT ME! - - - Just not worth it. I do enjoy parts of most races, but not enough to spend a whole day or two at the track and not even see half of what is going on. I like the replays too much to be there live. Once would be okay, to just have been a part of it once, but not usually. I was always a doer, not a watcher anyway. I still like doing rather than watching. Even missed the truck race tonight, cause I was "doing" out in the garage. - - - Besides Carl or Mark weren't in the race. Next year I probably won't watch any truck races as Ford/Roush is pulling out of trucks next year. Going to put all their time and money into Nationwide and Cup. Okay by me, then will have more time to "do" things.

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  14. 14
    Andi said:
    Nov 14, 2009 at 1:20 AM

    I think the other 64 chairs are for team owners, VIPs that might be apart of the prerace ceremonies, and the media, maybe. Oh and Hunter, Helton, and Darby. I know that on twitter there are reporters that are in the drivers meetings saying what's going on in the meetings. As for the rulebook, even members of the media aren't able to have one for themselves, they have to use a copy of nascar's. IF that even. Other then that, its for every official and race team, and owners. From what I have been told, that could be wrong though. And we wonder why those independent tracks are having trouble....well this filing explains ALOT.

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  15. 15
    arttidesco said:
    Nov 14, 2009 at 4:49 AM

    Surprise surprise its all about TV Money no wonder the Telecasts are 89 percent advertising and 9 percent yellow flag laps with a GWC finish.

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  16. 16
    grumpyjim52 said:
    Nov 14, 2009 at 11:42 AM

    Makes one wonder what the "agreement" is for ISC tracks, since the France family owns controlling interest of the stock, not to mention ALL of NASCAR? Hmmm....

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  17. 17
    manzytrophygirl said:
    Nov 14, 2009 at 4:27 PM

    #1 Rainier--where does the $$$$$ go? It lines the pockets, so to speak. Amazing, isn't it?

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  18. 18
    frankvr943 said:
    Nov 15, 2009 at 9:13 PM

    When did it become a crime to make money? If NASCAR is so bad why are you here? I would imagine it costs quite a bit to transport and provide lodging for all the employees each week. I don't know the number of people there are, but I see an official in each pit, the people in race control, people inspecting cars, people driving wreckers. How about the equipment used for inspection, scoring and timing. The trucks that transport the equipment. The drivers and fuel for the trucks. The NASCAR R&D center looks like it cost some money to build. I think before you crucify NASCAR maybe you should think about some of this. And show me a time when promoting racing wasn't about money. I for one am glad they make money, because if they didn't, we would have no NASCAR to watch each week, or demonize depending on your pleasure.

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