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People Started Out Not Trusting The Mayor


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Chicago 2016: Calculating the bid's true costs

Richard M. Daley By Kathy Bergen, Todd Lighty and David Heinzmann

Tribune reporters

September 16, 2009

Mayor Richard Daley likes to say his dream of bringing the Olympics to Chicago won't be a drain on taxpayers' wallets and pocketbooks.

"Tax money isn't paying for it. There's no tax money whatsoever," Daley said earlier this year. "We are very strong in that position ... in the regard to having that be sponsored by the private sector and others."

The 2016 Olympic bid committee states that the $4.8 billion estimated cost would be paid for with contributions from wealthy donors, corporate sponsorships, television rights and ticket sales to ceremonies and sporting events.

But the reality is more complicated than that. Hundreds of millions of dollars in local, state and federal tax money already is committed, from acquiring land for the proposed Olympic Village to helping construct sporting competition venues.

As Chicago's team prepares for the International Olympic Committee's Oct. 2 selection of a host city for the 2016 Summer Games, nagging questions persist among residents who are feeling squeezed by a tough economy and worried about just how much they may be on the hook.

"I think there is a healthy skepticism out there about whether we can really trust what they tell us about no taxpayer obligations," said Robert Baade, an economics professor at Lake Forest College. "Do you think anybody believes that?"

The mayor's office acknowledged Tuesday that public money would be spent on a number of projects. But Kate Sansone, spokeswoman for the mayor's office, said a number of the projects need to be done anyway and the Olympics would help pay for them.

"Many of the projects ... are part of the city's long-term goals to enhance the quality of life for residents in the areas of housing, transportation, green space and sport," Sansone said. "These are projects that would not be able to be accomplished without ... the infusion of funds generated by hosting an Olympics."

The Civic Federation, a nonpartisan group that studies government, found that the Chicago 2016 bid committee has a reasonably sound financial plan, but said City Council oversight was crucial.

The Chicago 2016 message, from the beginning, has been that "no Chicago taxpayer dollars" would be needed to host the Games, Doug Arnot, the bid team's director of sport, venues and operations, said in an interview Tuesday.

That statement does not take into account taxpayer money from the federal government. Federal funding would be used for, among other things, improvements to Monroe Harbor, busing during the Games and security, with security expected to cost more than $1 billion, according to some outside experts. The bid team also expects an acceleration of federal funding for transportation projects if the city wins the Games.

"If you ask Chicagoans if they'd like to see transportation spending here or in Arizona, my guess is they'd like to see it here," Arnot said.

The bid commits local tax dollars, as well, for construction projects, city services and government financial guarantees. But Daley and his supporters say the projects won't hike tax bills -- either because they expect private developers to pick up the costs or they expect Olympics-related tax revenue to cover the expenses. Or in some cases, they say, projects already were in the pipeline.

They also predict that the Games will operate with a surplus of cash, eliminating the need to tap into city and state guarantees. But Daley and the City Council last week put taxpayers ultimately on the hook by agreeing to an unlimited financial guarantee, which would have to be tapped if the Games go badly awry.

"The small risk that city money would be used is far outweighed by the enormous economic impact of the Games," bid leader Patrick Ryan said at a recent public meeting. Boosters say the Olympics would kick-start the local economy, creating jobs, drawing tourists and shining an international spotlight on the city's charms.

A Tribune/WGN poll released early this month showed that 84 percent of city residents opposed use of taxpayer money to cover any shortfalls.

There's a credibility gap, said Tom Tresser, a spokesman for No Games Chicago. "People started out not trusting the mayor from the parking meter mess," he said.

And even the best-laid plans hit unexpected snags, said Baade, who has studied cost overruns at previous Olympic Games around the world.

"Even if they had identified private funding for all these different things," he said, "I'm sure there would have to be public funding for what they are not providing for."

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