Chuck Brennan’s call for protest against Initiated Measure 21, South Dakota’s new 36% cap in payday loan interest rates, must not be working. Not only has the Dollar Loan Center magnate stopped lending money in South Dakota, but he is also shutting down the Brandon racetrack/concert venue he bought just a year and a half ago and putting it up for sale, along with “several” of his other South Dakota business assets.
Brennan spent millions in April 2015 to buy Huset’s Speedway, then said in June 2015 he was spending $5 million to upgrade the track, seating, infrastructure, and parking. Mocking race drivers who said they’d rather go to Knoxville to compete, Brennan said, “When I get done with this place, it’s going to crush anything they’ve ever done.” In September 2015, Katie Nelson reported that Brennan had a $6-million budget in place for speedway restorations. By August 2016, Brennan was claiming to have spent $10 million upgrading the speedway. That’s the figure he claims in his press release announcing that’s shutting the speedway down and selling it. His asking price: $9.75 million.
Brennan is also willing to take $6 million as a down payment and $1 million each year for the next six years. Compared to the up-front cash price, that six-year payment plan works out to 3.46% interest… probably the lowest interest rate Brennan has ever charged anyone. 3.64% is so low compared to Brennan’s usual 574% that he must find 3.64% indistinguishable from zero: his press release says tha six-year period is “interest free.”
Brennan says the closure is his response to our capping his interest rates. He puts this text in bold in the original statement on the Badlands Motor Speedway website:
On November 8th, 2016, the voters in South Dakota overwhelmingly passed a ballot initiative to eliminate licensed short term lending from the state. Well, that is what we do and our flagship business in South Dakota, Dollar Loan Center, was given only 5 days as a result of the ballot initiative by the State of South Dakota to comply with this change of law. This move by the voters has left hundreds without jobs and tens of thousands without a safe and alternative financial option.
Mr. Brennan has invested and donated well over $100,000,000 in his home state of South Dakota and most of that investment within a mile of where he grew up at 8th Street and Covell Avenue in Sioux Falls.
Because of these recent events, Mr. Brennan is reevaluating his economic presence in South Dakota and will be selling several of his many properties and businesses in the State and diverting that business to the other markets that he currently operates in [Badlands Motor Speedway, press release, 2016.11.30].
Local racers say the closure is not surprising… and it’s not caused by payday loan rate caps:
The track’s listing seems to follow national trends of local tracks shutting their doors, both drivers said. The sport is an expensive one for track owners and drivers, and has to compete for a dwindling fan following.
“It’s a money sport. It takes money to go fast,” [Humboldt racer Dan] Jensen said. “It needs more fans. But it’s hard to spend that money to go (to a race) every weekend.”
Harrisburg racer Jordan Martens agreed.
“Not a lot of fans come to support it anymore,” he said. “Every driver involved in the sport kind of has an idea of where local racing is going. It’s a bummer to see another track go” [Danielle Ferguson, “Badlands Motor Speedway for Sale, Local Drivers React,” that Sioux Falls paper, 2016.11.30].
Brennan’s sales pitch says nothing about the market realities his racers see. “The capacity for events of all kinds, in addition to the best racing in America, is simply staggering,” Brennan claims, “and the opportunity for the new owners group is limitless.”
Brennan, who seems committed to making money any way he can, doesn’t seem like the type who would give up on a viable financial opportunity. He seems more like the type who would blame others to cover up his own business failures. But I suppose it’s possible that his extravagant wealth enables Brennan to go all huffy-puff and throw away his racetrack at an apparent loss, just to flip the bird to an entire state that he perceives as having infringed on his right to exploit poor people…. at which point I would suggest that we make sure Brennan pays his remaining sales and property tax on the way out the door—for good, we can hope.
Of course, $9.75 million isn’t that hard to come up with. We could that much from a mere 20 EB-5 investors who’d like to support the efforts of the South Dakota Regional Center to expand jobs Amusement, Gambling, and Recreation—oh! if only South Dakota hadn’t lost its EB-5 Regional Center designation for corruption!
Looks like I’ll have to cover my own bid. I think I have some spare change on the dresser….