(Editor's Note: The 51 team has been and always will be big advocates of ASA (as evident by becoming a partner with ASA by sponsoring its Most Popular Driver Award). We will do anything in our power to help the series; although, at the same time, we are here to report the news. Lately, there have been all too many rumors concerning ASA and its future (and we have stayed out of that scene on our site), so speed51.com wanted to help set the record straight. ASA Owner and President Steve Dale talked exclusively with our Bob Dillner on Monday afternoon about the current state of ASA and the future of the Short Track sanctioning body. This is the conversation as it was recorded between the two for Speed51.com. ASA's Ross Wellman, Rob Albright and John Clark all joined Steve during the conversation and offered their answers, as noted.)
Bob Dillner (BD): “How did ASA get to the point it is at right now?”
Steve Dale (SD): “Back in 2000, there was a lot of enthusiasm around ASA. They had the new package with GM (engine) and BFGoodrich (tire); it was ASA's new era and it saw much success. 2001 didn't have quite the same luster, but nevertheless, it was still successful.
“Back in 2000, everything looked so promising and that's why ASA got the stars (up and coming drivers) from around the countryside. Then at the end of 2002, ASA was in trouble. It changed the landscape of ASA forever."
BD: “Why and how did you get involved with the series?”
SD: “In 2001 I tried to buy it, but so was another party and it didn't happen."
“We put a package together. It was a group, which I was a part of. And I agreed, because at the time I was the only one not gainfully employed, that I would run ASA on behalf of the group. And true, I would have had the majority of the ownership. We worked out a deal with Action (Performance) and with Gleitsman (Tom, car owner of the #63 and #4) and were told by BFGoodrich that there would be a certain amount of money that would be forthcoming in a new agreement.
“So consequently, as you saw, we made that announcement at the 2002 banquet to try to give some stability to all of the rumors at that time as to what was going to happen in the future. Action came there with their Executive Vice President, their lawyer and their Vice President of Marketing. They stood up in front of the group, like I did and like Mark (Gundrum) did, and said that 'we were all in this and it was going to be a great new future' and we certainly believed that.
BD: “Is there a point fund right now?” (EDITOR’S NOTE: ASA had announced a 1-million dollar plus point fund (approx.) for 2004 much like years past.)
SD: “There's not. I mean, I don't know how to answer this. No one pays the point fund but us. Out of each race that we went to last year, was there money set aside? There is not enough money made out of that revenue to set aside. At the end of the year we just have to write a check.
BD: “Will there be a check at the end of the year?”
SD: “Let me put it this way. If there is not going to be, we will say so. Before we go forward, we will say so.”
BD: “Where is ASA going for the rest of 2004?”
There has been plenty to talk about in the ASA driver's meetings this season.
SD: “That is a good question and we are going to dig into that not today, but really more on Wednesday (June 23). There are some things that are going on that will help us determine and make that decision as to if we are going to run all of the tracks or part of the tracks and how much are we going to gear up for 2005.
BD: “There was some talk that the series maybe needed some time off to get things back together. Is that something still in the back of your mind?
SD: “I think timing is everything. And last year would have been the right time for that. When I came in, in hindsight, had I had the guts, I would have just closed it down for a year, reorganized it and spent the whole year getting contracts and agreements back in place and creating a TV package.
“In other words, just organizing it and having it be ready to go. I came here in January, our first race was in March and nothing had been done. So to answer your question... no I don't think we can do that. It would be nice to think we could, but I don't' think we can.
BD: “The cancellation of the Pikes Peak race, can any of the blame for that be put on ASA?”
SD: “It can be, but not really ASA... me. Here is what happened. This working relationship we have with tracks works the same with basically everybody. Once we agree, we have a letter of intent that we send out; we sent that out to everybody. It is my belief, and I was not directly involved in it (the negotiations with Pikes Peak); I am going to have to go on trying to remember to piece it together; the letter of intent, as I recall, did not come back right away. But we had agreed, so we went ahead and put the schedule out.
“Then, we got a call from I-70 Speedway. The call asked us if we would still come out there if they couldn't pay us, even though they had bought the show. Our feelings were 'no' because one of the main reasons we signed the deal with them in the first place was we were under the impression that the track was going to be sold and renovated. They were going to put in new lights, new bleachers and have quite a bit fixed up. We were then informed that those things were not going to be done. So that put me in a position of deciding if we were going to go out there after we said we wouldn't since the schedule had already been announced and I-70 was on it.
“I have always been a believer in the fact that less events made it more plausible for teams to compete in all of of them rather than just picking and choosing. (You) create more consistency and better car counts throughout the entire racing season (with fewer events). So I proposed that we do 16. Internally here, it was proposed that Toledo become the other date that we cancel, but we didn't want to cancel it completely. We wanted to cancel I-70. With Toledo, all we wanted to do was not run the National Tour cars there but instead run the ASA Late Models. And we would pay (Toledo) and do everything like we've always done before. It was the same amount of money and we weren't asking for anything less.
“Over the next 30 days, Action fell out and the moment they fell out, Gleitsman basically fell out. Truthfully, I had pretty much fallen out myself. But I got a call from Mark (Gundrum) just before New Years saying that they'd been ordered to close the series on January 3rd. They were to call the employees and tell them not to report. So Mark told me that and said it looked like right now I was the only one that could stop that. So I agreed to do it. And that is how it began.
“We never did complete an agreement with BFG, but we agreed in principle in April and signed it in May, and in that case, it was a million-a-year shy where it was three million for the three-year agreement. So not only did we not have
"Then 2002 saw a lot of problems, especially in TV land. There was the TV contract (with TNN) that went from five years down to three and then finally terminated at the end of the year. And there were all the problems of our TV shows going up against the Cup races.
"Then in 2003, BFGoodrich limited its support of the series. And getting back to 2000, when ASA had the support of GM and BFG, all the purses and winners-circle money was raised. In fact, the points fund and the winners-circle money doubled. The purses went up by 30-40 percent, too. Then the sponsors fell off and it was partially because of the TV deal that had gone sour (with TNN).
ASA Owner and President Steve Dale talked with Speed51 about ASA's present and future.
Action or Gleitsman, but we were light on BFGoodrich as well. The burden (of picking up the rest) was on me.
“Almost immediately, we started spending all of our time being prepared for tough times ahead. We didn't spend any time, for the most part, on any sales. As it turned out, there was almost none. If anyone looks here historically, there has not been much in the way of sales. If you look, every year the company has lost sales and it has not brought in new people with any regularity at all.
“And without fail, someone has to be willing or able to just continue to feed the machine. (And at some point you just run out.) This series, on a per-event basis, will lose somewhere between $250,000 and $300,000 per event.”
BD: “To what degree is ASA in financial trouble?”
SD: “I don't know how to answer that. Do we have some payables? Yes. Most of our equipment is all paid for.
“I'm looking to only blame myself, but those are all facts. We didn't reduce the point’s fund. We didn't reduce the winner's circle. We didn't reduce anything. And yet, it was all revved up when there was a significant amount of sponsorship. When you take GM out and the money that escalated in sponsorship from BFGoodrich because of the CPI clause, you are looking at that amount. Plus, the other thing I didn't say, we have to pay for TV production (not the actual air slot); they never had to pay for TV. In fact, they even received rights fees of $42,500 per event. So not only do you now have to pay, you now lose that $900,000 in rights fees. That is one huge swing.
“Right now, we are up against it. We have to make what are some really tough decisions and I don't know how or what we could do or would have done a lot different.”
ROB ALBRIGHT (RA): “There are three primary sources of potential revenue. Sanctioning fee is one, sponsorship is two and ticket sales are three. You are going to have some merchandise sales and some other ancillary things and what not like entry fees and things, but those are the three primary sources. So when you expect to get a sanction fee and there is none, now you don't have a title sponsor or event sponsor, there is no revenue coming from there, and because it was their race, they are getting the ticket sales and you have guaranteed a quarter of a million dollar looser and that isn't even factoring in TV.”
BD: “What was the story with Berlin not being on TV?”
SD: “Truth is Bob; it was never supposed to be scheduled. We left it as a possibility. We were never going to have it on there and SPEED came back to us and told us they could do it tape-delayed. But in our actual agreement, they were so strong about it and had bought
“I can't say this for sure, but I don't think Ron (Drager of ARCA, the organization that owns and operates Toledo Speedway) was very happy with us anyway because I think he blamed us for losing those two dates (Charlotte and Atlanta) and the truth is, I don't know (if it had anything to do with it).
“So anyway, we got blamed for it and Ron said if you are not going to run the Tour cars there, you don't need to run anything here. So that forced me to have to cancel that. There is no way, in any way, shape or form, we could run both of those events there and even think of making it a
financial success. That forced my hand to cancel it as well. We went back on several occasions I might add, and tried to get them to let us run the Late Models there, even a month later, and we couldn't get them to change their minds. That is how the first two disappeared.
“We still think, this whole time, that Pikes Peak is fine. We've agreed to a certain amount of money and so forth. After a period of time, we called telling them to send back that letter of intent. The letter of intent is the beginning of the process to start doing an actual contract. So we are well into the way of doing contracts. Then we get the letter of intent back from Pikes Peak. I don't remember the exact time we got it back; let’s just say the first of March, long after the schedule was announced.
“We get the letter of intent back and they scratched through the amount of money and marked '0.' So Joe picks up the phone and calls over there and wants to know what the heck is going on. Nobody called us or no one told us anything. We just got something in the mail. Only at that time, are we made aware that something might be wrong. They said 'Yeah we want you to come out here but we can't pay you.' Now we've already canceled the other two; we are a little sensitive to that, and I don't me this derogatory to you, but organizations like yours (51) and others have already beat us up pretty hard on canceling the other two events. Well, the last thing I wanted to do was do it again. I didn't have the stomach for it.
“So I said we'd go ahead and do it and we'll find a sponsor for it. We went ahead and obviously other things became tougher as well financially. Our cash flow got worse and worse and worse. When that is going on, you are looking at an event that you know you are going out to and that you are not going to make a dime. You have no opportunity to recoup any of your money. All of a sudden, that looks like a bigger problem then it already was.
“So internally, we talked about it. We talked about it with some of the team owners and they said 'Look, that is just business. Under those circumstances, you can't do it. You can't go run a race for nothing.' So after we met with the owners, we gave it a few more days and then made a decision that we can't do it. Internally, we talked about it and then notified Pikes Peak prior to doing anything. We jointly worked together on that release.”
There is no race at Toledo Speedway in 2004.
the show (they being Berlin) that they did not want us to televise it live. So, it became an easy decision to not televise it. “We've never televised it in the past without bringing in lights, so that was another $20,000 of expense on top of the production. I could go on and on. It didn't make any sense to do that.”
“And in all fairness too, I was two payments behind to IMS (Production Company that puts on the TV broadcast for ASA and SPEED Channel). I didn't need to add a third one without me paying them likely.”
BD: “How emotional for you was the drivers/owners meeting for you at Berlin?” (EDITOR’S NOTE: That is where Steve shared some of the state of ASA with drivers and owners.)
SD: “I don't know how to describe that. Was it some place I wanted to be? No. It wasn't a very comfortable feeling. It wasn't something I wanted to do, but I needed to do it. Likely, the reason it was as much as it was, is because the one or two or three people that I don't confide in, but I am open enough with, elected to use that opportunity to ask me those tough questions, which was fine by the way.
BD: “Based on that meeting, what was the reception you got from the drivers, competitors and owners?
SD: “From my perspective, it was confidence. I have to admit that I only saw what I saw in that room. When we left that room, I have no idea what some said. I think it probably took some of them by surprise. I don't think people realized how much money we had to subsidize on every single event. I think that just floored people.
“If someone would have ever taken a moment to think about it, it is very easy to calculate what the purses are. The purses are roughly in the $60,000 range. Our winner's circle is roughly $60,000. Our points fund is roughly $55,000 per event; then your special awards. I don't have to go much further and then you throw in TV. You throw that in, what do you have? You are over $270,000 right there and you haven't even paid for one ounce of overhead of getting the tech there, getting our people there and what takes place back in the office. So you add that all up (and) you will find $350,000 is a pretty accurate number.
“But most to my surprise, I don't think people have thought about how much is really involved. When you take our staff and the production company, which ultimately we pay for, there are 100 people there at every event.”
Dale talks with Mike Garvey at testing of the ASA car in Kentucky.
The new look of the ASA car was one of the changes Steve made coming into 2004.
BD: “How many races would you like to see for the remainder of the season?”
SD: “I'd honestly like to do them all. I'm not prepared to say that we won't at this time; that is what we are going to work on this week. We are going to make those tough decisions.” (EDITOR’S NOTE: ASA plans to announce those decisions to drivers and owners first, on June 30th.)
BD: “If races are taken away from the remaining schedule, could the point fund change from what it was announced earlier this season?”
SD: “I think realistically, then, we probably would. It is all under review right now and I think it probably would.
BD: “Despite some of the negatives we have heard, there are a lot of positives for ASA.”
SD: “In many respects, we've gotten costs more under control. I think we've brought more attention to the series
Steve congratulates Butch Miller after winning at Lakeland (FL).
than it has had in a long time. Some of it is good, some not as good; certainly more attention. But with that, I think we did a lot of things really right. I think the people were very good, and now, our core group at ASA is as good as we've had.
“It is certainly hard for them, and it is certainly hard for me, not knowing the outcome of where we are heading. The product is good. I don't think people in general argue that. Is everyone perfectly happy? Probably not, but it doesn't look like they are perfectly happy in the Cup garage or anywhere else either. I think that is the nature of the beast. That is probably pretty hard to do.
“Bottom line with us is that we just have to lower our cost more or a combination of doing that and increasing our revenues. And increasing our revenues would be the preferred choice. And we've thought on several occasions, 'Why do we keep digging so hard and not get something sooner?' We thought we had things that were going to fall into place. And it was no one's fault, but for one reason or another, things just didn't work out. In the mean time, you just keep right on spending. We've just reached a point where. Bob, I can't sell assets faster than we are spending the cash.”
(EDITOR’S NOTE: The other half of the interview with Steve Dale and “The Future of ASA,” including the National Tour, the Late Model Series and its Member Track Program will be posted here at 51 on Thursday.)