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Grand Prix Sailor–America’s Cup Edition

America’s Cup Finances Investigated

December 29, 2002
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Bob Grieser/louis Vuitton

Grand Prix Sailor is a 13-year-old racing news publication of Sailing World Magazine (http://www.sailingworld.com). This AMERICA’S CUP EDITION is a weekly summary of Cup action, brought to you this week by Sea Recovery and Sunsail.

BOB FISHER’S REPORT FROM NEW ZEALAND

IT’S ALL ABOUT MONEY
It will come as no surprise to learn that it is now seen that the America’s Cup is driven by money. Not simply the millions of dollars, or other denominations of currency, but by the money that is needed to run the event, both the Cup match itself, but also the challenger elimination series for the Louis Vuitton Cup, and it is in the generation of this that the latest problems have arisen.

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All the time – the 132 years – that the Cup was in the hands of the New York YC, there was no problem. In one way or another, the club paid for the expenses, as it would have done the running of its Annual Cruise, funding the deficit from its own exchequer. Neither was there when the Cup moved to Fremantle since the fund raising activities of the Royal Perth YC fell short of what it cost the Australian club.

San Diego also proved to be no concern since its losses were gigantic, but when the Royal New Zealand Yacht Squadron became the trustee holder of the Cup in 1995, the troubles began. The Kiwis, as a nation, through the NZ Government, and through individual contribution, raised rather more money than was actually needed to run the regattas. To whit, it made a profit.

Some of this so-called profit was channeled into the defense of the Cup by Team New Zealand and no one seemed to object to that, at least until the lawyers decided that it was fair game for them to delve deeply into the Deed of Gift, where the Cup is descriptively donated as being “in trust”. Those words, it seems, have opened a new can of worms.

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In some eyes, this establishes the America’s Cup as a Trust, and as such its finances should be totally transparent. That Trust is seen as being under the jurisdiction of the New York State Court where the Deed of Gift is registered. The outstanding question is whether the event is, or is not, a charitable trust, since under New York law, charitable trusts cannot recognize sport as a beneficiary.

Now the New York State Attorney General, Eliot Spitzer, is conducting an enquiry into the manner in which the RNZYS has been using the money it has raised, using the America’s Cup trademark as its fund-raiser, following a complaint laid before the Attorney General’s office. This unnamed complainant has asked questions as to how much of these funds can be properly used by the defending club.

Others, among them the Alinghi Challenge, which denies that the complaint has come from that source, believes the funds that are surplus to the running of the Cup should be equally distributed between the defender and the other challengers. This has led to some xenophobic outpourings by the New Zealand media with one headline reading, ’Rivals seek Team NZ Cup money.’

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These are fuelled by the defection of Russell Coutts and other members of the winning Team New Zealand helping to form this challenge for billionaire, Ernesto Bertarelli, and the allegation that one of the principal reasons for their leaving the home team was that they were dissatisfied with the financial management of Team New Zealand.

They are also aggravated by the discussions among the challengers being led by Alinghi’s New Zealand rules advisor, Hamish Ross. A paper that he has circulated among the challengers proposes changes in the management of the Cup and questions its status as a charitable trust.

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ORACLE GOOSED?
As yet, no one, apart from members of the Oracle-BMW Racing syndicate, knows what the white container slung from the aft gantry of USA-76 holds. Many have their suspicions and these are wide-ranging, but when the International Jury made its recent finding, it did not find it necessary to seek knowledge of what “the goose” contained.

The International Jury simply held that the use of radar or laser range-finding equipment was illegal. Laser rangefinders have been in common use in the Cup since the mid-eighties and that of radar for offshore boats for an equal length of time. Talks are underway to resolve this issue.–Bob Fisher

THEY SAID IT
After the final race of the Semifinal Repechage, OneWorld’s Peter Gilmour was asked to predict the outcome of the Oracle/Alinghi matchup.

“It’s virtually impossible to make that assessment. Certainly, from the very little we know and understand of Team New Zealand, they are a slightly beamier boat, like us, and the other two finalists are slightly narrower. It will be determined by the wind conditions. I think the America’s Cup Match itself will be a very one-sided affair like what we saw in the 2000 Match. Either the Defender will be away and gone like they were in 2000, or the Challenger will be. I just can’t see a similar sort of mergence that you have seen in the Challenger series happening in the Match.”

Ian Burns, Oracle’s navigator was asked about any psychological disadvantage Team Oracle will have when they meet Alinghi in the Finals.

“On paper Alinghi have beaten us a number of times. We are taking a great deal of confidence from the fact that as far as the challengers are concerned we have probably improved as much as anybody out there. From the first round robin, where we were struggling in 4th place, to where we are now we have made some pretty big changes to the way we sail the boat and some pretty big changes to the boat itself. We are into refinement mode, more or less, but we think we are improving all the time. I am pretty confident we may have got to a level where we can take Alinghi on equal terms.”

STANLEY ROSENFELD 1913-2002
Stanley Zachary Rosenfeld, who died at the age of 89 on December 23, was nurtured by the America’s Cup, and he did great things for it and for maritime history.

Stanley said he first came to yachting photography “in my mother’s arms at a few weeks of age.” That was in 1913, soon after his father founded a photography firm in New York.

Stanley’s first Cup Match was the one in 1920 when Shamrock IV almost took the Auld Mug for Sir Thomas Lipton. After an apprenticeship steering the family photo boat, Stanley moved behind the viewfinder and became America’s best-known yachting photographer as black-and-white images slowly gave way to four-color.

A man of tremendous vitality, deep social concern, and keen sensitivity, Stanley Rosenfeld took his work seriously as art. He described a distinctive Rosenfeld aesthetic about the sea and boats. “What motivated us was always the best thing we could see,” he once told me. “When we looked at a boat, we tried to understand enough about the boat – how the designer meant it to look, how a type of boat evolved, what the function of the boat was – so that the boat appeared in our minds and in our eye on the camera the way it was supposed to look.”– John Rousmaniere

For the complete obituary, see: http://www.louisvuittoncup.yahoo.com/story1579.html

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DATES TO REMEMBER
Oracle will face Alinghi in the Louis Vuitton Finals beginning Jan. 11. The Finals will be a best-of-nine series to determine which team will meet the America’s Cup defenders Team New Zealand on Feb. 15.

Both Team New Zealand and the challenger will declare which boats they’ll sail on Feb.10, and both boats will be unveiled Feb.11.

NUMBER CRUNCHING
In 2000, Prada sailed 49 races to reach the Finals; in 2002, thanks to the format agreed upon by the 9 Challengers, it took Alinghi only 22.
Thanks to http://www.2003ac.com

Grand Prix Sailor and Grand Prix Sailor–America’s Cup Edition are weekly newsletters compiled by the editors of Sailing World magazine. If you’d like to subscribe, see http://www.sailingworld.com Contributing Editors: Tony Bessinger ([email protected]), Dave Reed ([email protected]), Stuart Streuli ([email protected]), John Burnham ([email protected])

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