CART mulls move to Nevada for tax benefits

Erin Neff

Friday, April 13, 2001 | 10:32 a.m.

CARSON CITY -- The CEO of Championship Auto Racing Teams told state lawmakers Thursday he would consider moving CART's racing operations and teams to Nevada in exchange for tax benefits.

Joseph Heitzler told the Assembly Taxation Committee that CART also is negotiating with Florida for a similar tax break to entice a move to that state.

"The determining factor of whether we come to this state or not rests solely in the passage of this bill," Heitzler told the committee.

The committee did pass AB657, which exempts engines, chassis and certain components of professional racing vehicles from sales and use taxes. Lawmakers were told the revenue CART would bring to Southern Nevada, in both business and tourism, would far outstrip the loss of revenue from the tax.

The bill applies to the sale, storage or service of engines and chassis and all other parts, except tires, paint, communications equipment and consumable fluids.

Heitzler said he was impressed with the ease CART officials have had meeting both local and state officials to discuss their plans. He met with Gov. Kenny Guinn and believes the access to state lawmakers shows Nevada to be friendlier than states in which CART currently has team shops.

Two-thirds of CART's 18 teams are based in or near Indianapolis, three are in Illinois, two in Ohio and one in Pennsylvania.

CART officials have been negotiating for more than a year with Las Vegas Motor Speedway officials about staging a race there. In recent weeks, the discussions have grown to include the potential move of CART's headquarters and now its actual racing teams.

But one industry source who is familiar with CART's proposal said it was highly unlikely that all of CART's 18 teams would move to Southern Nevada. Many of the top teams in CART have multimillion-dollar race shops and would not be willing to relocate even under the most favorable tax situations, the source said.

If the bill were to become law, it is more likely that some National Hot Rod Association teams -- many of which are based in Southern California -- and Indy Racing League and low-end CART teams might consider relocating to Southern Nevada.

John Force, a 10-time NHRA Winston Funny Car champion, was the only motor sports team owner to appear at Thursday's session. Force operates a three-car team that is based in Southern California and often speaks of his affinity for Las Vegas.

Heitzler said he was impressed by Nevada's Millennium Scholarship program that grants college money to all high school students who achieve a certain grade point average and who pass a proficiency exam.

Because the average CART team employee has 4.5 people in his or her family, Heitzler said such programs were important incentives Nevada can offer.

He also met recently with Las Vegas Mayor Oscar Goodman, who led a tour of the Union Pacific property downtown as a potential relocation site. Heitzler said CART is looking at relocating to an area near the Speedway, but has not yet finalized any deals.

Before the bill can take effect, it must first clear both houses and be signed by the governor. As written, voters also must approve the measure in the 2002 general election before it can take effect in 2003.

But lawyers representing CART asked for an amendment to allow a percentage of the exemption to take effect upon passage by lawmakers with the remaining percentage taking effect upon passage by voters.

"That offers an immediate incentive for these teams to come and not have to wait until 2003," said Tony Sanchez, a lawyer with Jones Vargas, who represents speedway clients.

Sun sports writer Brian Hilderbrand contributed to this story.