State money in play for Formula 1

AUSTIN (KXAN) - Austin's first Formula One race is now only three months away, and organizers have just cleared a major roadblock in getting state money – a controversial topic since the inception of this project three years ago.

Texas Comptroller Susan Combs is the shepherd of the Major Events Trust Fund -- a fund used to attract big business to the state. Based on an economic study the Circuit Events Local Organizing Committee put together, her office did its own analysis.

In a letter sent to City Manager Marc Ott this week, officials said F1 could likely receive just over $29 million. About $25 million would come from the state, and about $4 million would be matched locally by CELOC.

Combs called it “realistic” on Wednesday but not a done deal.

"Formula 1 is going to be doing fine,” she said. "It's based on our analysis and based on them having the event."

To tap the fund, a group like F1 has to apply for the money. Once the event happens, it has to raise a certain amount of tax revenue. If it does, the state will then reimburse organizers that same amount. In this case, it would be $25 million from the state.

Former Travis County Judge Bill Aleshire is a watchdog when comes to F1. He said the comptroller’s analysis is too broad – “a loose, ridiculous system.”

"You can't just take all the taxes that were collected in those four days and attribute that to F1,” Aleshire said. “That would be like assuming that Austin was a ghost town, and there was no economic activity here before they came."

While Combs stands by her system, Aleshire said it is something that needs stronger oversight, when it comes to taxpayers' “money that otherwise would have been available to pay for education or health care or any medical school, any number of other projects."

Combs said F1 will not get the money until after the race and only if it holds up to its end of the bargain as an economic success.

"There's not been a single dime spent on it, not by the state,” she said. “It's all been privately funded."

Sen. Kirk Watson, D-Austin – who helped ensure F1 could be eligible for these funds in a past legislative session – said he is now monitoring their use. If there are problems, he is prepared to file legislation next session to address those issues.

Also, he supported another check-and-balance bill that became law last session. It requires the comptroller to look back at the economic impact after the race, then post that report online for the public to view.

Read Josh's Political Blog for more details on this funding .