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Auditor General's Report On 2010 Games Cost


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Thursday, September 14, 2006

Report Says Vancouver 2010 Games Costs Rise – VANOC Responds

Posted 7:01 pm ET (GamesBids.com)

British Columbia’s auditor general Arn van Iersel released a report Thursday that cites a long list of potential problems with British Columbia’s estimated costs for the Vancouver 2010 Winter Olympic Games. He says the 2010 Games will cost federal and provincial taxpayers $2.5 billion and the province’s share could balloon further beyond its budget if it doesn’t keep a watchful eye, reports CP.

Colin Hansen, the cabinet minister responsible for the Olympics, said Wednesday that he was confident the province could stay within its budget of $600 million in direct costs.

Hansen said his government doesn’t count the cost of things like upgrading the highway between Vancouver and Whistler, where some of the events will take place, because that would have happened anyway.

But van Iersel said he has included those costs partly because the province hasn’t come up with a comprehensive definition of Olympic-related expenses, adding that inherent risks remain in the budget – “risks that could result in additional cost pressures to the province”.

The auditor general said he thinks there are still more costs that haven’t been taken into account and he doesn’t think the province has given taxpayers all the information they need.

“The funding envelope presented by the province provides only a partial picture of the total Games-related costs for the province and does not reflect its total financial undertaking related to the Games” the auditor general wrote in his report.

He added, “of particular concern is that the province has not yet established a definition of what constitutes an Olympic cost”.

In the report he tells the province to keep a closer look at the dollars and cents being spent on the 2010 Games. He said it is the province which is the guarantor and would ultimately be left responsible for cost overruns.

He also called on the province to get more specific cost estimates for security, now budgeted at $170 million.

Hansen said there is nothing to indicate those costs would see any significant increase and there is enough in the contingency fund to cover increases, while noting that the Prime Minister has indicated there may be a need to be flexible on those costs.

Meanwhile the auditor general says there will be lasting legacy benefits associated with the Games, but adds no new information on the potential economic value of those benefits to the province has been made available.

Vancouver 2010 has issued a response to four reports released Thursday by the Government of Canada, the Province of British Columbia, and the Office of the Auditor General of British Columbia acknowledging the “valuable observations, recommendations and accountability that the organizing committee will ultimately help Vancouver 2010 deliver the 2010 Games with lasting legacies”.

John Furlong, Vancouver 2010 CEO said, “we welcome these reports as a valuable opportunity to enhance accountability and to refine and improve upon our game plan. Staging the Games is a tremendously complex exercise and this in-depth process has been highly useful, both in confirming our successes, and in some cases considering new approaches as we go forward.

“The reports provide experienced industry perspectives that will help us as we work together with our government partners to ensure that our venue program is achieved within our $580 million venue budget. We understand our fiscal responsibility to the taxpayers of B.C. and Canada to achieve our venue plan and to create lasting community and sport legacies that will be enjoyed for generations”.

He added, “we will continue to do everything possible to find savings and manage risk until every venue is finished. We consider our capital funding complete and are confident we can deliver our program under our $580 million budget”.

Dan Doyle, VANOC executive vice president of venue construction said, “more than 55 per cent of our venue construction will be completed by the end of the 2006 construction season and we have $66.8 million in our contingency fund”.

Things like the Canada Line, Sea to Sky Highway Upgrade, and the Vancouver Convention Centre Expansion should not be included in these costs.

Canada Line - it was included in the region's transportation network plans in the 1970s and a planning committee was formed in 1994 (two years before the bid) for the rapid transit project - the committee, known as RAVco.

Sea-to-Sky Highway - early in the 1990s, before the bid, there were already plans to upgrade the highway. the stretch from Whistler to Vancouver has killed more than a dozen people so far this year - it is one of the most dangerous highways in Canada.

Vancouver Convention Centre Expansion - proposals and planning for a new expanded convention centre began in 1992, before the bid.

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I can understand about Sea-to-Sky highway part of the cost. But the Canada Line for sure shouldn't. Even if we don't have an olympics, we would have built the M-Line extension and a rapid skytrain line from Lougheed to Coquitlam Central. Then Global said that the AG will count things such as the olympic station cost; that station would have been needed anyways as there is high residential interest going to downtown and to richmond. Now maybe VANOC should pay a little bit for using the Vancouver Convention Centre for the olympic bids, but that shouldn't be part of the cost as well.

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I can understand about Sea-to-Sky highway part of the cost. But the Canada Line for sure shouldn't. Even if we don't have an olympics, we would have built the M-Line extension and a rapid skytrain line from Lougheed to Coquitlam Central. Then Global said that the AG will count things such as the olympic station cost; that station would have been needed anyways as there is high residential interest going to downtown and to richmond. Now maybe VANOC should pay a little bit for using the Vancouver Convention Centre for the olympic bids, but that shouldn't be part of the cost as well.

Olympic Station is important to the rapid transit line and that's simply why it's funded by the city instead of being deferred to the future. That's the same reason why the 99 B-Line has a station there as well, nearby. Geez.....just because it's called "Olympic Station" doesn't mean it's related to the Games.

what do you mean VANOC should pay for the convention centre?

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No no no... I don't mean that VANOC should pay for the centre. The convention centre should be paid entirely by the BC Government. But what I'm saying is that VANOC should pay for the space they use, like a rent.

They are. Not only that but VANOC will be spending millions to install media and communications technology into the facility.

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Welcome to Olympic Reality!

These Games, like all others lately, are going to cost BC $billions and about 6 weeks after they're over, people will begin to know how the costs got out of hand.

Only the IOC can be so bold as to force bidding cities to pay millions in costs just to bid on the Games that will eventually cost them much, much more, and always leave taxpayers holding the bag.

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lol... but right now, the BCNDP is using this on the BCLiberals, which obviously I don't support the NDP... Carole James said in a press conference that the BC Liberals should fire all members of VANOC and hire those who would protect and respect the interests of taxpayers... Now because it's easy for the BCNDP to say that because they aren't really the party that is dominating British Columbia.

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^ lol, other than the logo and Torino Closing Ceremony fiasco i really can't see what else VANOC has done wrong. venue construction overruns are simply something VANOC can't control, and besides a booming economy - which creates surplus government revenues - balances out with construction overruns. The 2006/2007 BC Provincial Government surplus is projected at $1.2 billion; twice of the originally estimated $600 million surplus earlier in the year.

i should also mention that VANOC, according to the bid book venue construction schedule, is right on track with construction. There are only 2 more years left of venue construction at this point. so they're doing a great job in this regard. however, i wish we would spend more on the venues, to make them really spectacular.

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