The Effects Of The Texas Motor Speedway

Essay, Research Paper

The Effects of the Texas Motor Speedway

The North Texas area has recently added a feature to its geography that will help the local economy to prosper. This man-made monstrosity is called the Texas Motor Speedway (TMS), it covers an area of more than 1,200 acres, construction workers had to move more than 4 million cubic yards of dirt in building the speedway, also the main grandstand has room enough for more than 200,000 people. “Under construction for nearly six months, Texas Motor Speedway [is] America’s second largest sports facility,” (Maready Feb. 8). The motor speedway includes many interesting and amazing sights, like the Lone Star Tower, the 10-story building that looks out over the raceway’s second turn. It has 76 luxury condominiums with living-room views of the auto races. Each is selling for between $275,000 and $575,000. Also, the speedway has a ballroom, tennis courts and exercise facilities. And of course there’s the bathrooms, there are 2,450 toilets, twice as many for women as for men. Speedway officials say the speedway has more toilets than any other facility in the world. It takes a lot to keep up the TMS, for instance the speedway lighting system, which uses mirrors to simulate glare-free daylight, uses enough electricity to power 2,286 homes or to light a 406-mile highway. And speaking of highway, the speedway contains 5,250 tons of concrete, enough to build a sidewalk from Fort Worth to San Antonio (Dearing). As much as the speedway is a spectacle around the metroplex, it really has helped to better our economic system. The newly constructed Texas Motor Speedway is helping the local economy by increasing aggregate spending in the area, causing the surrounding area to develop, and raising national awareness of events, jobs, and businesses surrounding the speedway.

The amount of money that is spent at and around the TMS reaches amazing figures, this influx of new money greatly increases the level of aggregate spending in North Texas. Profits from the TMS have come in waves, the first of these ‘waves’ came from the construction of the motor speedway, the materials, land, and workers were all mainly procured in Texas, this sudden spending were none had been before shot the profits for many people and businesses through the roof. Vast amounts of money were spent during the construction of the TMS, with “private and public expenditures of $107 million for the proposed speedway and supporting infrastructure,” this initial payment would “boost regional economic activity by $262.2 million,” (Gross 1). By examining the figures, we can observe the multiplier effect at work, the original amount of $107 million was compounded in the economy until it developed in to the regional total of $262.2 million. Economic activity will really start to heat up once the second wave of the TMS development comes about, the opening. This stage can actually be broken into two parts, the first of which is to examine the impact the new employees of the TMS will have with the new income and increasing retail expenditures. There are two types of employees at the TMS, permanent employees of the speedway will receive and estimated $4.313 million and will then use $1.725 million of their earnings to buy retail goods, this spending will result in an increase of Texas’ sales tax receipts by $108,000; all this new spending will result in regional economic activity increasing by an estimated $4.2 million (Gross 15-16). Then there are the temporary employees working for the speedway, to figure their effects, one must assume that there will be 3 major events a year lasting 4 days each, then that employees will average 10 hour days at $ 7.53 an hour. These people will receive about $3.634 million a year and annually spend $1.453 million on retail increasing sales receipts by $91,000, economic activity will increase by 3.561 million (Gross 16-17). As one can see, the effects brought about by employing a few individuals are far reaching and very good for the economy. The second part of the second wave of the development of the TMS is the impact visitors will have on Texas. People from all over the world will converge on North Texas to attend races and other events at the TMS, these people will need everything from hotel rooms to rental cars and will have to pay for these services with their highly prized greenbacks. An assumed 750,000 visitors will come annually to the speedway, these foreigners will spend an estimated $62 million dollars in the metroplex and surrounding areas, their expenses will boost state and local tax receipts by $4.8 million. Hotel and motel tax receipts rise by as much as $674,000 and the new spending will boost the economic activity by nearly $152 million (Gross 17). One could be daunted after looking at the vast amounts of money portrayed when viewing the economic impact of motor speedway, but to put it in laymen’s terms, the TMS is good and brings a lot of money to Texas.

With all the money surrounding the TMS new businesses crop up like weeds, these stores open up the way to further development, new workers are hired thereby giving them money to spend at local stores thereby putting more money into circulation, stating the cycle which will build to economic fulfillment. The motor speedway creates jobs for thousands of people, both within itself and then in the surrounding areas. During the construction of the speedway, it supp