By Ronnie Cohen
SAN FRANCISCO (Reuters) - San Francisco's troubled America's Cup sailing regatta was dealt another setback three weeks before the competition starts when organizers said they would refund tickets to watch early races and postponed plans to build temporary seating.
The announcement by America's Cup officials late on Monday in the wake of last week's decision by Sweden's Artemis Racing to remain in the regatta following a fatal accident last month, even though its boat and crew would not be ready to compete in the initial rounds.
Money for tickets for the opening days of the Louis Vuitton Cup, which is scheduled to start in early July with a reduced number of races, will be returned, as will seat payments for the subsequent semi-finals, organizers said in a press release.
Organizers said they scrapped plans to build bleachers (temporary seating) for fans to watch the qualifying races, although they still planned to erect them in August for the semi-finals.
Round robin races are scheduled to begin on July 7, and the winner of the Louis Vuitton, in which Artemis and two other teams are competing, will challenge for the America's Cup against defender Oracle Team USA, backed by software billionaire and Oracle Corp co-founder Larry Ellison.
Artemis has said it might not be able to race until the end of July after losing one of its two boats in an accident that killed Olympic gold medalist Andrew Simpson.
Simpson was trapped underwater after the team's 72-foot high-tech catamaran capsized and broke apart in a training run.
In October, one of Oracle's two multi-million-dollar AC72s, flipped and broke apart before being recovered. No one died in that capsize.
Organizers have adopted improved safety measures in the aftermath of the Artemis incident.
Among them, fewer races for the Louis Vuitton Cup will give the teams, including Italy's Luna Rossa Challenge and Emirates Team New Zealand, more time for boat maintenance.
"We really thought the best thing to do for the fans is we won't put the bleachers up, and we'll give your money back," said Tom Ehman, the America's Cup authority's spokesman.
Since Ellison's team won the 2010 Cup in Valencia, Spain, it got to call most of the shots for this year's regatta, like its location in San Francisco Bay.
By bringing the race to San Francisco, Ellison hoped to make the Cup more appealing to spectators. Races have normally been held too far out to sea for land-based spectators to see.
"This is the magic of doing it in San Francisco Bay," Ehman said. "It's one of the best - if not the best - sailing amphitheaters in the world. Not only is it beautiful, but it's reliably windy."
Artemis can join the competition during the Louis Vuitton Cup semi-finals, which begin in August, but would start in last position.
Race organizers and San Francisco city officials have scaled back their ambitious plans for the regatta.
City officials initially estimated the competition would bring three million visitors, $1.4 billion in revenue and 8,800 jobs to San Francisco this summer, said city spokeswoman Jane Sullivan.
Those estimates assumed eight to 12 boats would compete for the right to race against Oracle, but with a serious challenge to win the Cup estimated to cost upward of $100 million, only three teams took up the challenge.
The most recent estimates are for the regatta to attract two million visitors, and provide $900 million in revenue and 6,500 jobs.
Mark Buell, chairman of the America's Cup organizing committee, told Reuters he believed the reduced number of preliminary races would do little to dampen benefits to the city.
"The big races are in the end of August, early September, and that's when we expect the crowds," he said.
"The real interest is in the finals, to see who's going to challenge Ellison and in the races themselves."
Waterfront bleacher seats for the preliminary races cost from $15 to $38, Ehman said.
He did not know immediately how many tickets had been sold.
Organizers plan to install big-screen televisions in as-yet undetermined locations so fans can watch the races, Ehman said.
America's Cup owns the television rights and has sold them to broadcasters all over the world, though few of the preliminary races were scheduled for broadcast, Ehman said.
(Editing by Alden Bentley and Greg Stutchbury)