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Texas F-1 Race Won't Get Early State Cash, Comptroller Says

(Adds organizers’ comments in sixth and eighth paragraphs.)

Nov. 15 (Bloomberg) -- Texas, which had pledged to put up $25 million a year to subsidize Formula One car races in Austin, won’t pay in advance as planned, Comptroller Susan Combs said today as race organizers halted work on a $242 million track.

Texas was going to make the first $25 million payment to London-based Formula One Management Ltd. before the initial race next year. The state had agreed to annual payments of that amount for the next decade, using taxpayer trust-fund money.

New Jersey’s plans for a Formula One race near New York City, a slowdown in construction of the 3.4 mile Austin racetrack and disagreements “prompted speculation about whether the Austin race will even occur,” Combs, a Republican who has supported state backing for the events, said in a statement. The New Jersey race won’t get taxpayer subsidies, according to a statement from Governor Chris Christie’s office.

“Texas will not be paying any funds in advance of the event,” Combs said in the statement. “Only after the race occurs would any funds be disbursed.”

Circuit of the Americas, which is building the track, separately announced the suspension of construction, citing delays in obtaining contracts binding Formula One to stage races there, according to a statement.

‘Great Concern’

“The failure to deliver race contracts gives us great concern,” Bobby Epstein, founding partner of the track developer, said in the statement. No state funding was designated for the construction work.

Jeff Hahn, a spokesman for the developer, said the comptroller’s announcement didn’t prompt the work suspension. He declined to comment on what she said. The first Austin race has been scheduled for Nov. 18, 2012.

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