In the ongoing debate over whether the Detroit Belle Isle Grand Prix's organizers should be allowed to convert the city's one-of-a-kind island park into a private raceway, gearheads typically fall back to one point — the annual event provides a huge economic boost to the city.
Since there's growing frustration with the race in its current location on Belle Isle, and the economic impact is Penske's central justification, it's worth examining the study's claim in detail.
(For the sake of argument, let's ignore for now that the race could be held elsewhere in metro Detroit and the region would still benefit from the alleged economic impact.)
The first issue is one of credibility. The Grand Prix paid for the study, hiring St. Louis-based SportsImpacts — a marketing firm — to produce some numbers.
SportsImpacts provided us with their findings' executive summary, which we ran by Field of Schemes' co-author Neil deMause. His website tracks public subsidies for sports franchises, and he's written a book on the economic impact of sports stadiums and events.
He tells Metro Times the Penske report isn't the worst he's seen, but he notes most firms are given a target figure from which they essentially work backward.
"Most companies that do economic impact studies are in business to come up with an analysis that is going to make their clients happy," deMause tells us. "So if you are being hired by the Grand Prix to study whether there's an economic impact, you are going to bend over backward not to say that there's no impact at all.
"
"There are enough assumptions that you can tweak the study to make it sound better or worse, depending on what you do for your clients," he adds.
One of the big issues deMause notes is a concept called substitution. Any money spent at the Grand Prix is money not spent elsewhere in Detroit's economy.
Stay on top of Detroit news and views. Sign up for our weekly issue newsletter delivered each Wednesday.
We welcome readers to submit letters regarding articles and content in Detroit Metro Times. Letters should be a minimum of 150 words, refer to content that has appeared on Detroit Metro Times, and must include the writer's full name, address, and phone number for verification purposes. No attachments will be considered. Writers of letters selected for publication will be notified via email. Letters may be edited and shortened for space.
Email us at letters@metrotimes.com.
Detroit Metro Times works for you, and your support is essential.
Our small but mighty local team works tirelessly to bring you high-quality, uncensored news and cultural coverage of Detroit and beyond.
Unlike many newspapers, ours is free – and we'd like to keep it that way, because we believe, now more than ever, everyone deserves access to accurate, independent coverage of their community.
Whether it's a one-time acknowledgement of this article or an ongoing pledge, your support helps keep Detroit's true free press free.