Cup to Runneth Over With Cash, Backers Say

The America’s Cup regatta is expected to generate about $1.2 billion in revenues for San Diego when the event is held in 1991 off Point Loma, according to an economic analysis released Friday.

Standing outside a modest Mission Hills home, officials from the San Diego America’s Cup Task Force and Sail America Foundation attempted to deflect the sport’s elitist image by insisting that revenues from the event will trickle down to every neighborhood in the county.

Brian Bilbray, a county supervisor and head of the task force, said that more than $250 million of the projected $1.2 billion in revenues “will go into the neighborhoods,” for an average of $300 per every household in the county. Bilbray accepted a symbolic $1.2 billion check from Thomas Ehman Jr., chief operating officer of Sail America Foundation.

Enthusiastic race officials said they were confident that the estimated figures were realistic because they were “conservative” projections. In reaching the $1.2 billion estimate, analysts used a multiplier of 2, based on the economic theory that every dollar spent directly on an America’s Cup activity will generate the indirect expenditure of two more dollars in the San Diego economy.

In July, Australian officials said that $639 million was spent during the five-month long regatta in Fremantle, Western Australia, which concluded with Dennis Conner’s victory aboard the yacht Stars & Stripes. That was $146 million less than the Australians had anticipated.

Many Differences

Nevertheless, Bilbray and other America’s Cup officials went to great lengths Friday to explain the many differences between San Diego and Western Australia, which they say makes the $1.2 billion figure realistic. These include:

- The county’s population, which is expected to be 2.4 million in 1991, compared to a population of 1.4 million for all of Western Australia’s 974,843 square miles.

- In 1991 there will be an estimated 17 million people living within 200 miles of San Diego, while Australia’s present population is only 16 million. This will average out to a population density of 358.7 people per square mile in the eight Southern California counties in 1991, while Australia’s present density is 5.2 people per square mile.

Yachting, and the America’s Cup in particular, have traditionally been viewed as a rich man’s sport. But race officials insisted Friday that the America’s Cup race now enjoys mass appeal and is rivaled in worldwide attention only by the Olympics and World Cup soccer matches. Their objective, said Sail America Foundation officials, “is to bring economically disadvantaged people into recreation (yachting) and promote good sportsmanship around the world.”

So broad is the America’s Cup popularity, said Warren L. (Skip) Hull, director of CIC Research Inc., the company that did the economic analysis, the 1991 races will attract an estimated 2.5 million visitors, including up to 100,000 foreigners. Visitor spending alone is expected to total $369 million, Hull said. CIC also did the economic impact study for the 1988 Super Bowl and predicted that professional football’s biggest event will bring $141 million to San Diego.

The 1991 America’s Cup races will be held between February and May.

Friday’s rosy prediction about the bonanza that San Diego’s economy is expected to reap in 1991 was hardly new. America’s Cup officials have been saying all along that they expected tourists and the 20 syndicates expected to participate in the race to drop at least $1 billion into the local economy.

In addition, Bilbray said that the race will create about 9,126 new entry level jobs in the county.

Researchers reached the $1.2-billion figure after considering several elements that were broken down into three areas, Hull said.

Direct spending, which includes the $369 million expected to be spent by visitors, will total about $544 million. This will include $90 million expected to be spent by the 20 syndicates and $85 million in private and public spending to stage the event.

Indirect spending, America’s Cup related sales by one local business to another, will total $108 million, the report said.

Finally, local residents are expected to spend $515 million on America’s Cup related sales, including souvenirs and other race activities.

Hotels and Motels

According to the economic report, local hotels and motels are expected to lodge 1.75 million visitor days during the races. (For example, if one person stays 5 days, that is considered 5 visitor days.) The report predicts that visitors will spend $262 million for entertainment and hotel costs, and an additional $107 million while staying in private homes in the San Diego area.

Hull said that his firm relied heavily on the Australian economic report done on the America’s Cup races in Fremantle. The researchers took the Australian figures and averaged them with similar figures in the San Diego economy, which is generally stronger than the Australian economy but which also features higher prices for consumers.

“This report is simply a projection, a preliminary estimate and very conservative. We would like to measure it again about two years down the road. Of course, a lot depends on what the economy is like in four years, but there’s a good possibility that the $1.2-billion estimate may have to be raised,” said Hull.