Jump to content

cost explosion


ghost1

Recommended Posts

As we now can see the costs for Vancouver 2010 will increase approx. by 40 to 50 % as the building costs for venues and other buildings will go over the budgeted 470 million $. The remaining amount has to be paid by BC government. The final number will be much higher for OG´s 2010 than expected.
Link to post
Share on other sites
  • Replies 123
  • Created
  • Last Reply

As Michael Leeds from Temple University  said:

Michael Leeds, an associate professor of economics at Temple University said, “almost any economist is going to tell you it’s a bad deal. It’s a bad deal for the taxpayer. It’s a bad deal for the typical Chicago merchant. Almost every Olympics runs a deficit”.

Leeds said the benefits of hosting an Olympics are overstated and the costs are understated. “Most of these mega-events, whether they are Olympic Games, World Cup soccer or Super Bowls, don’t have much of an impact”.

“But it shouldn’t be sold to the people as an engine for economic growth”, he said.

I think everything is said regarding costs for future host cities. After a few post-olympic years the impact is gone lost. With increasing costs the way into crisis is forseeable. One day there is the last deadline, economical and in any other way. OG´s will be very hard to sell to people, not yet but in next future.

Link to post
Share on other sites
Sofia today announces that when winning the bid for 2014 they expect that this will cost 1.322 billion Euro. A huge amount for a small and not very rich country like Bulgaria, although they want to collect the money from sponsors etc. Calculating the normal increase, as usual in the past, the real costs will be about 400 or 500 million Euro more than budgeted.
Link to post
Share on other sites

If they want to spend the money, fine!

Actually, for a country like Bulgaria that might well be the type of investment that could pay-off by establishing themselves as a reputable winter vacation destination. In that sense, places like Sofia or PyeongChang would stand to reap more benefits from the games than an established and traditional centre like Salzburg.

Link to post
Share on other sites
If they want to spend the money, fine!

Actually, for a country like Bulgaria that might well be the type of investment that could pay-off by establishing themselves as a reputable winter vacation destination. In that sense, places like Sofia or PyeongChang would stand to reap more benefits from the games than an established and traditional centre like Salzburg.

Exactly! And what's more - this is a great investment for the future of the region/country. There were NO WOG's so far with minus account at the end, and if there is one - noone can predict what impact Olympics can have on tourism for the future, but, believe me, it's big enough - so in long terms there can't beany loss from Olympics, even more for countries like Bulgaria which are relatively unknown and can be a new tourist destination

Link to post
Share on other sites
Agreed. For Bulgaria this might be a good investment in tourism. They are already known for summer tourism. This is the same case with PC. Regarding Salzburg this would not be correct as a lot of investments were done in the past, and they failed. The impact would not be the same as for Sofia.
Link to post
Share on other sites
the OC of Torino avoids bankruptcy as the Italian government has agreed to pay 64 million Euro. This amount may be enough to clear the numbers before the Games, but after Torino 2006 they still will have a negative balance. Let´s ask IOC why they give OGs to host cities which have massive problems in financing the Games. This is not the first one, we had a lot of host cities in the past which are gone bankrupt because of the Games. The Games should be enjoyed by the athlets and the spectators and should not bare the risk for the organisation city to pay for it years and years. Torino 2006 is a classic example for hosting Games today.
Link to post
Share on other sites
  • 2 weeks later...
Sofia today announces that when winning the bid for 2014 they expect that this will cost 1.322 billion Euro. A huge amount for a small and not very rich country like Bulgaria, although they want to collect the money from sponsors etc. Calculating the normal increase, as usual in the past, the real costs will be about 400 or 500 million Euro more than budgeted.

What is this budget ? OCOG + Non OCOG bugdet ?

From the past games, we know that an OCOG budget is rather 1 billion Euros (to organize the games and built temporary venues).

And for the Non OCOG budget it depends on the need of the city (improve the transportation, built new venues, ...)... Between 600 million and 1 billion euros ....

So i think, the minimum for winter olympic games is rather 1,5 billion Euros...

Link to post
Share on other sites
the OC of Torino avoids bankruptcy as the Italian government has agreed to pay 64 million Euro. This amount may be enough to clear the numbers before the Games, but after Torino 2006 they still will have a negative balance. Let´s ask IOC why they give OGs to host cities which have massive problems in financing the Games. This is not the first one, we had a lot of host cities in the past which are gone bankrupt because of the Games. The Games should be enjoyed by the athlets and the spectators and should not bare the risk for the organisation city to pay for it years and years. Torino 2006 is a classic example for hosting Games today.

The 2014 race may open the eyes of the IOC about that. With a majority of them never hosted a Winter Olympics before, never mind bidding for one, it makes one wonder how they will go about reforming this aspect of the Olympic Movement.

Link to post
Share on other sites
Let´s ask IOC why they give OGs to host cities which have massive problems in financing the Games. This is not the first one, we had a lot of host cities in the past which are gone bankrupt because of the Games.

Because most IOC membres who vote haven't read the Bid Books, have no idea of the financial problems of the countries and they do not measure what costs represent the games !

They are in their world......

Lets' joint the forum about the IOC voting system !!!

Link to post
Share on other sites

the budget for Sofia includes also non OCOG items.

An additional comment why IOC gives the Games to "special" places: the personal relationships and preferences of IOC members have an major impact on the decisions.

IOC doesn´t care about bid cities. I.e. when an European city want to bid for Summer 2016, Jacques Rogge says: you are welcome instead of saying: save your money and wait for the next round, as 2016 the chances of an European city are below zero.

So a lot of reformation and renewal is necessary in the big sport organisations (FIFA and UEFA do the same thing).

3951.jpg

8b_blatter_wideweb__430x294.jpg

images58252_johansson.jpg

Link to post
Share on other sites

After the longtime financial problems in Torino now there is the torch to heavy. When an organisation has problems since a long time the problems will stay until the end of the Games 2006 - that´s only logical.

Olympic%20torch02.jpg

Link to post
Share on other sites
After the longtime financial problems in Torino now there is the torch to heavy. When an organisation has problems since a long time the problems will stay until the end of the Games 2006 - that´s only logical.

Olympic%20torch02.jpg

Yes, but heaven having problems till the end, you can organize great games.

Remember Athens 2004 !

Link to post
Share on other sites

but remember Athens 2004 after the end of the Games: the venues are used now by gypsies and homeless people and the city is completely bankrupt. Also the Greek government has now not enough money to bid for football EC 2012 as the actual champion.

IOC doesn´t care about this. But I think they have to. Athens is not the only one. There are a lot of examples, i.e. Montreal etc.

Although the cities do not have the budget to host Games IOC gave it to these cities. I think that was the wrong decision.

In future there will be very few real candidates. It would be better to take only a few into consideration. Candidates that have absolutely no chance should not bid. I.e. the bid for OG 2012. It was clear that the Games will go to Europe. But nobody told NY, that it´s quite useless to bid for it.

Link to post
Share on other sites

I agree.

but remember Athens 2004 after the end of the Games: the venues are used now by gypsies and homeless people and the city is completely bankrupt. Also the Greek government has now not enough money to bid for football EC 2012 as the actual champion.

But for Athens, it is more a problem of Legacy and "White Elephant". About legacy, i mean new roads, news transport systems, cleaning the city and some sport venues... I knew Athens before the Games and the actual one. Athens won 10 years and is now a great city. OK, all should have been paid in 2004 instead of beeing displayed during 5 years. That's one of the problem.

The second problem is that they build some venues that have actually no use, no legacy !

Cities biding should really think about using more temporary venues. These venues are at the only OCOG cost and not in the non OCOG paid by the state !

For the Paris 2012 bid, we use a lot of temporary venues (OCOG budget). I remember some people complaining about this high number, that using temporary venues was against the IOC wish of "Games Legacy". But why, the french citizen should paid for sports' complexes without no future....  They would have said "thanks" for the new transports systems or for the new superdome, but not for 5 or more others medium stadiums (capacity of 2000 / 5000 people...) !

IOC doesn´t care about this. But I think they have to. Athens is not the only one. There are a lot of examples, i.e. Montreal etc.

Although the cities do not have the budget to host Games IOC gave it to these cities. I think that was the wrong decision.

So bid cities should think about it before biding.

But also IOC should be in phase with his wish to reduce the size of the games and to have less expensive games....

The Executice Committe say that, but they encouraged more and more cities to bid (and keep 5 cities in their short list)... and IOC members (who voted) doesn't read the bid book and so are not aware of the costs of the games !

The London 2012 project is a good one. And i said this, even if i was a Paris' supporter. It will be very interesting for the future of London. But at which cost ! I hope that all the venues have a real legacy and that the London's citizen will not have too much taxes !!!

I am actually in Vancouver, and citizens are afraid to paid for the Games.... And we already know some increasing costs for some venues !

Even before the bid, citizens were asked if they were agreed that their city became candidate.... And the yes won with a few votes...

So to conclude, i think that more financial and operational experts should participe (with a real power) in the process of chosing an host city... Should the IOC voting process be renewed ???

The forum about "the ioc voting process"

Link to post
Share on other sites
but remember Athens 2004 after the end of the Games: the venues are used now by gypsies and homeless people and the city is completely bankrupt. Also the Greek government has now not enough money to bid for football EC 2012 as the actual champion.

IOC doesn´t care about this. But I think they have to. Athens is not the only one. There are a lot of examples, i.e. Montreal etc.

Although the cities do not have the budget to host Games IOC gave it to these cities. I think that was the wrong decision.

In future there will be very few real candidates. It would be better to take only a few into consideration. Candidates that have absolutely no chance should not bid. I.e. the bid for OG 2012. It was clear that the Games will go to Europe. But nobody told NY, that it´s quite useless to bid for it.

Hence, you will always get people who will go against "anything" that is associated with mega-projects of any kind. Even though there are successes from some past Olympic cities, some of these NIMBYs and related people will never believe such "positive aspects" of the Olympics for whatever reasons/excuses they can come up with. With Torino 2006, all the other future Olympic host cities are going through the same thing in varying degrees.

Link to post
Share on other sites
I agree with your comment, Memorabilia. Regarding Vancouver or Torino: both cities won nevertheless the financial problems were known. As you said, nobody seems to read bid books. I think this was a "gentlemen agreement" between several IOC members and the bid organisators. Also a decision for PyoengChang or Salzburg was possible. IOC urgently needs a reorganisation to bring up new ideas. These are negative examples but we should have a look in the future to prevent the trend of the actual situation of the bid cities.
Link to post
Share on other sites
Regarding Sofia´s budget for the bid: 7,336 million USD seems not to be enough. Salzburg has spend about 7 million EUR for 2010 -  and failed. To be on top you have to spend about 10 to 12 million EUR. The 7 million will not be enough. This will be enough for the shortlist, but that´s all.
Link to post
Share on other sites
Regarding Sofia´s budget for the bid: 7,336 million USD seems not to be enough. Salzburg has spend about 7 million EUR for 2010 -  and failed. To be on top you have to spend about 10 to 12 million EUR. The 7 million will not be enough. This will be enough for the shortlist, but that´s all.

But this is how Berne 2010 was going to spend on the bid and it failed not because it was a weak bid or PR, but because its own people

Link to post
Share on other sites

Archived

This topic is now archived and is closed to further replies.


×
×
  • Create New...