Greens councillor John Mackenzie has slammed a Newcastle council-commissioned report on the benefits of Supercars as a "breach of public trust" which ignores the race's costs.
The council published last week an "economic analysis" from accounting firm Ernst & Young which concluded that each Newcastle 500 weekend produced $36 million in economic output and 149 jobs.
The council said the report was part of an "ongoing review" into the race, which is up for a five-year contract renewal in March.
Cr Mackenzie was critical of a council-commissioned report from Hunter Research Foundation Centre in 2018 which he labelled at the time a "cynical PR exercise" because it ignored the negative impacts of the race on residents and businesses.
On Sunday, he went a step further, describing the latest analysis as a "betrayal" of local businesses.
"All the community has ever asked for is a cost-benefit analysis to see if the three days of increased tourism stacks up against the eight weeks of disruption for residents and diminished trade for local businesses," he said.
"Instead, council has engaged professional accounting firms to do half the job and only present the positives.
"There has not been the slightest attempt of this council to understand the impact of the race on the viability of business in Newcastle East, let alone lift a finger to compensate them in any way for these costs."
Cr Mackenzie said the council had "specifically requested that no such effort was made to calculate a single cost" in the EY report.
"This goes beyond the typical council spin and PR.
"This is an ongoing breach of public trust by the council and a betrayal of local businesses that experience real negative economic effects from this event."
EY also conducted a survey which found Supercars had a negative impact on 23 per cent of businesses polled in Newcastle local government area and a positive impact on 38 per cent.
Supercars attracted the highest positivity and negativity scores of 10 major events in the city.
Across the Hunter, 60 per cent of accommodation providers surveyed reported a positive impact and 13 per cent said the race had a negative impact on business.
The survey was conducted in November and December 2020, before Supercars announced the event would move to March in 2022.
Cr Mackenzie said the EY report was "designed to justify half the case for going ahead" with extending the race contract next year.
"No decision-maker has ever commissioned a benefits analysis. You only commission a benefits analysis to spruik a decision made previously," he said.
"One in every four businesses in the city is negatively impacted by decline in turnover and reduced hours for staff, which has indirect costs through second and third rounds of reducing spending across the local economy as a whole."
A City of Newcastle spokesperson said the EY research was not intended as a "full cost-benefit analysis".
The negative impacts had been acknowledged in the research, but "accurately quantifying these impacts is very challenging post-race".
"The study was never intended to be a full cost-benefit analysis as reliable data on negative financial and social impacts is not readily available to allow a formal CBA," the spokesperson said.
"City of Newcastle has taken considerable steps to lessen negative impacts, including negotiating expedited bump-in and bump-out processes."
The spokesperson said it was "incorrect to state that only the benefits" had been considered, pointing to the survey of residents' and businesses' perceptions.
"Significantly, the report found many more local businesses reported a positive financial impact than negative from the Newcastle 500."
The future of Supercars in Newcastle has become a key issue in the December 4 local government elections.
The Labor bloc on the existing council wants the race to continue, as do two Liberal ward candidates, Blake Keating and Callum Pull.
Newcastle Independents lord mayoral candidate Cr John Church says he would support the race in a different location but, if re-elected, would vote against it continuing in Newcastle East.
Newcastle Tourism Industry Group chairman Kent Warren said Supercars "drives strong visitation".
"We do understand the event can have a negative impact on some venues close to the track," he said.
"We need to think outside the square to support these businesses. This could involve initiatives to promote businesses outside of the event period which show a negative impact from big events. It could offset some of the downside experienced.
"On balance, we see more benefits than negatives."
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