Thompson In Turn 5 · Tommy Thompson · Tuesday October 30, 2007
The key to being an successful bluffer in a game of poker is to time the bluff properly so that the hand is never called, and thusly, the other players are never certain whether a player is really bluffing. For once it is discovered that a player is prone to bluff, the tactic losses a great deal of its advantage in future situations.
Well, Ollen Bruton Smith is a champion at playing his cards to their best advantage and never having to show his hand – and he just proved it all over again.
In a month long poker game that pitted the City Council of Concord, North Carolina against billionaire Bruton Smith, owner of Lowe’s Motor Speedway, the City Council folded their hand last Friday night to what probably was nothing more than a well-executed bluff by Smith. However, the City Council realized that they were in a game that required stakes well above what they could afford to lose – and Smith had plenty of extra chips on the table. In the end, city leaders voted to lift a restriction imposed Oct. 1st, permitting Smith to continue construction of a planned drag strip on racetrack property, a construction project that could cost up to $60 million.
By rezoning the speedway property to prohibit a drag strip due to noise concerns by homeowners living near the facility, the City of Concord entered into the ill-advised game of wits by betting the only chips they possessed – the ability to rezone. However, the 80-year old billionaire had more than enough chips in reserve to play out his hand, and he raised the pot considerably more than the City Council could risk. Rather than get into any prolonged legal wrangling with the city planners, Smith decided to cut through all the bureaucratic "red tape" and slugged Concord right between the eyes by announcing that he would raze the speedway, sell the land off piecemeal, and build a new state-of-the-art motorsports complex somewhere else in the greater Charlotte area.
Should the City Council have stood firm and called the North Carolina native on what may very well have been nothing more than a bluff? Considering the risk vs. reward, the answer is clearly no. Had Smith backed off his threat to desert the facility that he built in what was nothing more than a rural crossroads community in 1959, the only real gratification achieved would have been an uplifting of the Council's egos. Oh sure, perhaps the few dozen self-serving residents living nearby the racetrack would have slept better knowing that they had beat "the man" by stopping a project that would have benefited the community as a whole, as well. But beyond that, very little else could have been gained.
Assuredly, egos did contribute to what should have been nothing more than a run-of-the-mill everyday zoning dispute into an issue that has become a big story within the NASCAR community, Cabarrus County, and the states of both North and South Carolina. Bruton Smith is a man that does not like to be told no, and he understands that he has the muscle to slap down impudent local officials that dare question him. When Smith started grading the site for the new drag strip without a permit and with a very public proclamation that he did not need permission from the city, he dared the local authorities to act. Challenging any city's authority to be involved in the construction of anything within its jurisdiction is almost ludicrous, unless, of course, you are reported to be one of the 300 wealthiest people in America. And in the end, the local politicians, though no doubt still fuming at Smith's arrogance, were forced to concede that, in effect, he can do as he pleases.
Smith played virtually an identical "maybe we'll just move" hand in 2003, but against another outmanned opponent, the County Commissioners of Sullivan County, TN. The County is home to Bristol Motor Speedway; at the time, Smith told the local media that a suggested 10% entertainment tax would likely result in him moving at least one race date to another Speedway Motorsports, Inc. track, the publicly traded company that Smith founded and serves as Chairman and CEO of. And just like the City Council of Concord, the local government in Tennessee made the prudent decision to not risk significant financial loss to the community and dropped the entertainment tax proposal as a means to generate needed revenues to operate the county, which would have avoided possible cutbacks in the number of county employees.
Was Smith bluffing in Tennessee? No one can say for sure. He was never called on to show his hand. But the hand was played eerily similar to the one that was played out this month in North Carolina – complete with reminders of how much the race track has meant to the local economy, and the almost hokey theme that he guesses that he isn't appreciated there anymore.
During the October 26th meeting, the Concord City Council not only voted unanimously to lift the ban on the drag strip they had voted in not a month earlier, but now they are discussing various tax incentives for, among other things, noise abatement, that they can offer Smith. In a further admission of their defeat, they are requesting that the State of North Carolina rename the major artery to the speedway "Bruton Smith Boulevard." With 70% of the city and county's tourism dollars (approximately $170 million) directly related to Lowe's, and more than $1.72 million dollars in annual property tax collected from the 2,000 acre enterprise, the locals are now showing Bruton the love he feels was missing. It is even within the realm of possibility that if Smith continues to play his cards correctly, in the end they might be willing to agree to just go ahead and build the desired drag strip for him!
But it doesn't seem that Smith is finished punishing the locals for their insolence in ever challenging him in the first place. Although prior to the Council vote Smith acknowledged that a vote to lift the construction ban would "â€¦show a lot of friendship," he continues to maintain that there still is a 90% chance that he will still abandon Lowe's Motor Speedway and build elsewhere. And he is still at least going through the motions of discussing new track sites around Charlotte and the Rockhill, S.C. area. This interestingly worded proclamation would suggest an almost certainty that the speedway will still be relocated. Time will tell – but I believe the more important number is the 10% possibility that he allowed himself to never do anything except sit back and enjoy the benefits of a hand well played, resulting in a groveling local government and a clear path to continue reaping the profits from his impressive motorsports complex â€¦ complete with a 4-lane drag strip promised to be "superior to anything in the nation."
Such is the life of a billionaire.
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