The City Council of Valencia has found a formula to settle its debt for the construction of the Formula 1 street circuit without moving a single euro from the municipal coffers. The Urban Planning department has valued the works carried out on the layout at 21.3 million euros, considering them urbanistically useful. This amount will be passed on to the owners of the Grao PAI (Urban Action Program) through the transfer of land, thus avoiding a direct outflow of public funds.
How the urban compensation mechanism applies to the circuit layout 🏗️
The mechanism is based on considering the circuit works as urbanization charges. According to the technicians, elements such as the asphalt, drainage, or underground pipelines have a real benefit for the development of the PAI. By passing this cost on to the landowners, the council avoids a direct expense. The valuation of 21.3 million has been carried out through an expert report detailing which items are usable and which are not, establishing a compensation model that other municipalities could replicate.
The F1 is paid for with plots of land, like renting an apartment 😅
Who would have told the Grao landowners that their plot would end up paying for the whim of setting up an F1 circuit. Now it turns out that the asphalt of turn 4 is an urban improvement and that the chicane curb is a neighborhood infrastructure. Next thing you know, the podium will count as a children's play area and the pit lane as resident parking. Good thing the city council isn't paying, because otherwise, they might even ask for a guarantee.