LA Olympics plan facing backlash over same overrun guarantee that sank Boston’s bid

Los Angeles Mayor Eric Garcetti said last week that he’ll sign the International Olympic Committee’s pledge to cover any cost overruns if the 2024 Olympics are held in his city, saying any bid would be “dead on arrival” without it. The L.A. Times editorial board, for one, is displeased:

[U.S. Olympic officials] know they need L.A. more than L.A. needs the Olympics.

But does Garcetti know this? We’re not sure. Last week, Garcetti said he’s pushing hard to be the American bidder for the Games, and that’s good. But he wouldn’t even consider playing hardball when it comes to the requirement that the city guarantee to pay any cost overruns. That’s not so good.

The mayor and his Olympic advisors say Angelenos shouldn’t worry, as Bostonians did, about paying for cost overruns because there won’t be any. Period. The city just can’t lose, he said.

Where have we heard that before? Oh yes, Montreal’s mayor said something similar just before his city incurred $1.5 billion in debt for staging the 1976 Summer Games.

Now, there are indeed some reasons to hope than an L.A. games could avoid some of the worst of the red ink that has befallen other Olympics: The city does have a lot of existing venues, for starters. Still, the number of Olympics that haven’t lost money is so vanishingly small — the only one in recent memory is the 1984 Olympics in L.A., which notably got an exemption from the overrun guarantee — that it’s worth being cautious. And with fewer and fewer cities willing to take on the risks of being a host city, this might well have been a good time to call the IOC’s bluff on this.

That’s apparently not going to happen, at least not this time around in L.A. (Unless the L.A. city council does an end run around the mayor and gets a public vote banning any public spending on cost overruns, as it did before he 1984 games.) Still, it’s interesting to see pushback growing to the IOC guarantee requirement — first in Chicago over its bid for the 2016 games, then with Boston, and now in L.A. It’s likely to be a while before the world runs out of mayors more eager to be the politician who landed the Olympics than the politician who stood up to them, but as I said in my own L.A. Times op-ed last month, the Olympics are supposed to be about chasing big dreams, right?

Japan issues guidelines for cheaper Olympic stadium, doesn’t include actually making it cheaper

The Japanese government has issued guidelines for designing a new Olympic stadium that isn’t as insanely expensive as the one they scrapped last month:

Japan on Friday approved guidelines for its new Olympic stadium, vowing to build an “athlete’s first” stadium as cheaply as possible and complete it by March 2020, a year later than planned, but without including any cost estimates or limits.

Great start, guys!

Prime Minister Shinzo Abe also announced that “We should make a structure that will emotionally move people all over the world,” which the original design certainly managed to do. Hilarity is an emotion, right?

 

Beijing to host 2022 Winter Olympics, probably should just host all Olympics from now on

Beijing has been chosen to host the 2022 Winter Olympics, defeating Almaty, Kazakshtan in a two-city race after every city you’ve actually heard of dropped out. This will make Beijing the first city to have hosted both the summer and winter games, which is interesting from a trivia perspective I suppose, and the second city where there isn’t really any snow to host a Winter Olympics. (Events requiring actual winter will be held 100 miles away in Zhangjiakou.)

If there’s an upside here, it’s that at least Beijing already has lots of event spaces left over from the 2008 Olympics that can be repurposed for 2022, and presumably has already evicted everyone necessary to make way for the Olympic Village and such. In fact, once Beijing has a full set of Olympic venues for all seasons, maybe it would be best just to let it have the Olympics permanently, as Chris Dempsey of No Boston Olympics suggested earlier this week in my article for Vice:

Dempsey, for one, dreams of a day when the Olympics will just settle down in one place and put this orgy of beach-volleyball-stadium-building to an end. “Since 1896, we’ve invented the radio, TV, the internet, air travel,” he says. “You’re in a world now where 99.9 percent of people watch it on a screen. And the vast majority of the other people who are going to be there will fly in to see it. So they could really fly anywhere in the world for it — they could fly the same place every four years, and you could build this stuff once and not have to worry about with these massive capital and infrastructure costs.”

Sure, China has a terrible human rights record, but clearly the IOC doesn’t care much about that anyway. It would mean North America and Europe watching lots of events in the middle of the night or on tape delay, but we do that regardless, and who’s to say that Asia’s huge population doesn’t deserve to watch the Olympics in their own time zone? If Beijing wants to be Olympic City, I’m all for it, so long as it spares the rest of the world’s cities the headache. Now we just need to do something about the World Cup.

Boston doesn’t want your stinking Olympics, should any city?

I’m sure you all caught this already, but Boston’s 2024 Olympic bid imploded spectacularly on Monday, with Mayor Marty Walsh declaring that he wouldn’t let the USOC rush him into signing a guarantee to cover cost overruns, and the USOC promptly declaring that it was withdrawing Boston as its chosen bid candidate.

It was all very sudden, but, as I wrote at Vice Sports yesterday, not entirely unexpected given how poorly the bid was going so far:

All the talk about ballooning costs not only worried Boston residents — who were mostly opposed to hosting the Olympics from the start — but garnered opposition from more than a few local elected officials, the sort who typically fall into line once there’s sports to be chased. Boston city councilor Tito Jackson had already announced he planned to subpoena Boston 2024 for more financial details; Massachusetts Gov. Charlie Baker, meanwhile, hired economists Brad Humphreys and Allen Sanderson — both notedskeptics about the benefits of sports construction — to put together that report on whether the Boston bid numbers made a damn bit of sense. (One hopes we’ll still get to see it, as it would be fun reading, though the governor may end up deciding that would be rubbing salt in Boston 2024’s wounds.) Walsh, in all likelihood, merely put the final nail in the coffin with yesterday’s announcement, though he certainly did it with gusto.

The question now is whether the USOC will put forward a candidate at all for 2024 — the deadline is September 15, which doesn’t leave much time to revive a candidate from the ashes, though they’ve already put in a call to Los Angeles — and whether we’re entering a new era of cities steering clear of the Olympics as a nightmarish money suck, after most of the 2022 Winter Games candidates withdrew for that reason. Writing in the Guardian, Les Carpenter suggests that that would be an excellent idea:

The internet is clogged with slide shows of empty, broken, useless stadiums built in the euphoria of a coming Olympics or World Cup then abandoned soon after, allowed to fill with weeds, rodents and other signs of human escape. Is there a better sign of Greece’s collapse than a pile of useless sports facilities crumbling since the torch went out in the summer of 2004? What use did Athens have for a baseball stadium anyway? It’s crumbling among the weeds just like the field hockey venue, the canoeing center and the training pool green with algae…

After Rome, Paris, Hamburg and maybe Toronto or Doha – all fighting to host the 2024 Games – the list of Olympic hopefuls may quickly dwindle until only bidders will be places like Beijing or Qatar or breakaway Soviet republic. These are places that won’t need to worry about local opposition when writing checks in the name of national pride. The concept of getting one big city to compete against another, with each promising more extravagance is probably an old one.

Of course, that’s still plenty of cities to keep the Olympics in business, though at some point the IOC may have to reduce its lavish demands a tad if it finds no takers. (Or gets tired of holding all its Olympics in China.) After all, the last time cities started bailing on the Olympics, after the financial disaster of the 1976 Montreal games, Los Angeles ended up the host by default, despite a plan that built no sparkly new facilities at all. We’re not there yet by any means, but the 2026 and 2028 bid processes are going to be real interesting.

Japan changes course, won’t build $2B Olympic potty-stadium after all

Holy cow, Japan’s war of cartoons against their $2 billion Olympic stadium actually worked:

Three years after Japanese Olympic organizers selected a vast, sleek stadium design by a prominent Iraqi-British architect for the centerpiece venue of the 2020 Summer Games, the government announced on Friday that it would scrap the plan and start over because of spiraling costs…

“The current plan will go back to being a blank sheet of paper, and we will rethink it from scratch,” [prime minister Shinzo] Abe said at a news conference.

This just two days after Abe said there was no way he was going to change the design, because there’s only five years left before the 2020 Summer Olympics, and that’s too short a time to come up with something cheaper, somehow? But that was before this:

x3dgqr93vluqumudThe new plan is, well, a blank piece of paper, so no one knows what it will look like or how much it will cost. Reuters reports that Abe “made no mention of costs and whether this meant another competition for a design, or if another design from a 2012 competition would be used.”

Anyway, this kind of thing happens from time to time — the Brooklyn Nets were originally going to have an arena designed by Frank Gehry, recall, until it turned out to be too crazy expensive and featured an office building next door that looked like a stack of post-apocalyptic milk crates. The hope is that Japan can now come up with something both cheaper and less ugly, though the precedent here isn’t exactly promising.

Tokyo’s 2020 Olympics stadium now set to be priciest, ugliest in history

I haven’t been providing updates on Tokyo’s butt-ugly 2020 Olympic stadium, mostly for lack of time, so let me remedy that now: Japanese prime minister Shinzo Abe says it’s too late to change the design, and also the price tag has now risen to a breathtaking $2 billion, making it the most expensive stadium the world has ever seen:

What is the money buying? The design of the stadium’s ribbed roof on huge steel arches resembles a bicycle helmet. To support a natural grass field, the roof’s southern end will be translucent to let in sunlight and underground will be soil ventilation and temperature control systems. Movable seats will bring the crowd closer for more intimate events, and this being Japan, the stadium will have earthquake-resistant features…

Andrew Zimbalist, an economics professor at Smith College in Massachusetts, added that he suspects the cost will rise further during construction, which is due to begin in October.

Despite widespread popular opposition to the plan, it looks like the stadium, and its soaring price tag, will go ahead as scheduled. At least it’s given the Japanese public the opportunity to create lots of macros comparing the stadium to a potty seat, and who can put a price on that?

Boston’s Olympic stadium cost estimate just doubled, if you can believe the numbers at all

Backers of Boston’s 2024 Olympic bid issued a “version 2.0″ of their official proposal last week, expanding the plan to include building 12 million square feet of new housing, hotels, and other construction in two neighborhoods, to be paid for by kicking back future city tax revenues from the new development. (Yes, that’s a TIF, though they don’t call it that.) The specific numbers are yet to be worked out with developers, though that didn’t stop bid chair Steve Pagliuca from modestly calling his own plan “the biggest economic development opportunity of our lifetimes.”

Also yet to be determined, apparently, is exactly how such line items as a new Olympic stadium would cost. Or rather, the bid documents give some exact numbers, but they’re nothing like the exact numbers in version 1.0:

The updated proposal to spend roughly $1.2 billion on land acquisition and construction costs in support of the stadium complex and its legacy uses is far greater than the $530 million-to-$660 million estimate first outlined by Boston 2024 in its initial bid to the U.S. Olympic Committee in December…

A Boston 2024 spokesman did not provide an explanation for the cost differences between its initial and updated stadium proposals.

The stadium cost estimates now include $285 million in land acquisition (up from $85 million), $640 million in site demolition and prep work (which seems like an awful lot), and $176 million for construction of a 60,000-seat stadium (which seems way too low, even for a temporary stadium that would later be removed).

If all this sounds suspiciously like numbers that are being fabricated out of thin air, the bid documents — available here — won’t dissuade you from that notion: Like most PR materials, they’re heavier on pretty renderings (many with fireworks, because who doesn’t like fireworks?) than on actual substance. This is about as detailed as the financial cost breakdown gets:

Screen Shot 2015-07-08 at 8.13.02 AMWith documentation like this, it should probably come as no surprise that the average Olympics has run 179% over budget, with losses for government agencies typically running into the billions. And yet, every city’s Olympic committee insists that its bid will be the first to buck this trend. Boston’s plan includes taking out insurance policies to guard against cost overruns, but like so much else here, the details have yet to be worked out — maybe in version 3.0.

Converting Boston Olympic stadium for soccer would cost as much as building soccer-only stadium

Boston Magazine has published the complete bid book that Boston 2024 gave to the United States Olympic Committee in December, and it includes a bunch of details on the proposed Olympic stadium that were not in the previous public document. In particular, the cost for a temporary stadium that would be torn down after the 2024 Summer Games is estimated at about $521.3 million ($436.3 million for construction, $85 million for land); designing a stadium that could be converted for later soccer use by the New England Revolution would add another $134.5 million in construction costs, plus $59 million for the actual conversion.

That’s $193.5 million total, plus land costs, which could get you a pretty decent standalone soccer stadium to begin with. Why the Boston Olympic committee would want to roll that into its own budget — or even whether it really intends to, since this is still just an options document — is unclear, but the situation remains worth keeping an eye on.

 

Boston mayor pledges no eminent domain for Olympic stadium

Boston Mayor Marty Walsh has promised he won’t use eminent domain to seize land for a potential Olympic stadium in Widett Circle in South Boston, which means it probably won’t get built there, seeing as that there a bunch of local businesses there that don’t want to move. Assuming Boston actually gets the 2024 Olympics, that is, which is still probably a longshot — the city’s bid could, in fact, come to an end as early as November, if opponents manage to get a promised referendum on the ballot to withdraw the bid. Other cities have recently had to withdraw Olympic bids after losing public votes; latest polls show 50% of Bostonians approving the bid, 33% opposed, and 17% undecided.

Or, it could all go through, and the Olympic committee could just win the proposed stadium land by throwing enough money at landholders to make it an offer they couldn’t refuse. Which could include public money. Which probably wouldn’t help Olympic advocates in any referendum battle.

Boston’s “no public money” Olympic stadium pledge may not count public money for land

The Boston papers are off to an excellent start asking the questions that need to be asked about Boston’s 2024 Olympic bid: First the Boston Globe asked architects whether a temporary stadium would really be any cheaper than a permanent one (answer: nope); now the Boston Herald is questioning why, if the Olympic stadium won’t require any public money as promised, it needs a quasi-public authority to build it?

The city, the state and the MBTA would hand over public land in Boston’s Seaport District to the newly created agency or an existing quasi-public with “expanded authority,” which would purchase surrounding private land, as well as railway air rights, to build the 80-acre stadium and surrounding development, according to the bid submitted to the U.S. Olympic Committee last month.

Quasi-publics are typically financed at least in part by taxpayer funds or public resources. The backers behind the Boston Olympics have repeatedly denied taxpayers would foot the bill for the creation of a public authority…

The bid doesn’t address how the city or state could cede public land and relocate current public facilities without taxpayer money.

All excellent questions! Boston 2024 executive vice president Erin Murphy Rafferty replied in a statement to the Herald that the pledge not to use “any tax dollars for Olympic-related construction” is “non-negotiable and is one we will keep” — but, of course, “land acquisition” isn’t “construction,” now, is it? This is one to keep an eye on, so hopefully the Boston newspapers will continue to do so.