Bermuda beats San Diego to host 2017 America’s Cup

The America’s Cup is going offshore, to a British territory that sits at the northern tip of the Bermuda Triangle.

In a shake-up to the tradition of the oldest trophy in international sports, organizers announced Tuesday that Bermuda beat San Diego for the right to host the next America’s Cup in June 2017.

The decision was made two weeks ago by software billionaire Larry Ellison, who owns two-time defending champion Oracle Team USA, after consulting with Russell Coutts, a New Zealander who is the de facto America’s Cup czar.

This will be the first time a U.S. defender holds the America’s Cup outside the United States. It also will be the first time in the regatta’s 163-year history that a defender sails the races in foreign waters by choice rather than necessity.

Bermuda is some 3,231 miles from the Golden Gate Yacht Club, which holds the America’s Cup and staged just one defense on its home waters, when Oracle Team USA staged a thrilling comeback against Emirates Team New Zealand last year. Coutts pulled the regatta from San Francisco after city officials insisted organizers would have to pay for services they had previously received for free.

While picking Bermuda has been criticized by traditionalists, Coutts defended the choice of the island nation of 65,000 people over San Diego, which has hosted the America’s Cup three times, as well as three Super Bowls, two World Series and the U.S. Open golf tournament.

“We’re tasked in making the best America’s Cup we can,” Coutts told The Associated Press by phone following a news conference in New York. “I think this will be the best one yet. We’ve got to look at it pragmatically, look at the facts and make what we think is the best decision for the Cup going forward.”

Details of Bermuda’s financial package have not been disclosed. Coutts said the America’s Cup Act is scheduled to go before Bermuda’s parliament on Dec. 12.

Coutts downplayed reports of financial concessions and tax breaks for teams and participants.

“That wasn’t one of the considerations we had in choosing the venue,” said Coutts, who is CEO of Oracle Team USA, director of the America’s Cup Event Authority and holds one of three Oracle-controlled spots on the GGYC’s America’s Cup committee.

He said it’s “highly unusual” for most America’s Cup companies to make a profit, and that he will retain his status as a New Zealand tax resident.

Coutts said the major factors for Bermuda were plans to put an America’s Cup village with all team bases at the Royal Naval Dockyard overlooking the race course on the Great Sound and a time zone that will be more accommodating to European TV viewers. Four of the five challengers are European-based.

Bermuda Premier Michael Dunkley said his country brings “a dash of British charm with our own unique island culture.”

“Bermuda is at its essence a marine environment,” said Dunkley, whose country sits at the tip of a mythical triangle where planes and ships have mysteriously disappeared. He mentioned a temperate climate, the sailing conditions and “crystal blue waters and pink sand beaches that will provide such a stunning setting.”

Troy Sears, a key member of San Diego’s bid committee, congratulated Bermuda.

“I believe the decision was a relatively easy one to make as there are significant differences between the two cities,” Sears said. “Much has been said about the tax advantages of Bermuda, but it can easily be said that California taxation is very high and makes it difficult to bring an event to California. More importantly, California regulations were a major obstacle to try to overcome for the America’s Cup.”

This is the second time Coutts has taken the America’s Cup from the United States. In 1995, he skippered Team New Zealand to a five-race sweep of Dennis Conner off San Diego. Coutts has won the America’s Cup five times, for three different countries.

The syndicates that rely on corporate sponsorships might have a hard time raising the $100 million or so needed to compete.

“We have made no secret that our preference was San Diego but now there is a final decision we can move forward with certainty,” said Grant Dalton, whose Team New Zealand also is partially funded by the government. “There are pros and cons for either venue for sure.”

The America’s Cup began in 1851 when the schooner America beat a fleet of British ships around the Isle of Wight.

Bermuda will be the eighth venue.

“We’re halfway there,” cracked Sir Ben Ainslie, who hopes to become the first Englishman to win the America’s Cup.