Games facing cash crunch

Not long ago, it seemed like organizers of the 2010 Winter Games had constructed a gold-medal model on how to put on an Olympics.

Not long ago, it seemed like organizers of the 2010 Winter Games had constructed a gold-medal model on how to put on an Olympics.

New sports facilities in Vancouver and Whistler, B.C., were completed on schedule and on budget.

The backdrop of the Games would be one of the most beautiful urban and Alpine settings to ever host an Olympics, in a country that defines its identity by snow, cold and everything winter.

Yet with less than six months until the Olympic flame is lit in Vancouver, key knots in the plans for the 2010 Winter Games are slowly coming undone because of a worldwide recession seen as the worst economic slump since the Second World War.

No one is saying the 2010 Games’ budget won’t be balanced. But at a time when the focus should be on the final few details, a multi-million dollar budget shortfall is fraying the close ties that bind Vancouver officials and the International Olympic Committee.

The IOC’s co-ordination commission makes its final trip to Vancouver this week and will review transportation, accommodation, venue arrangements and plans for the opening and closing ceremonies, among other things.

But plans in some of those areas can’t be finalized because of an issue that’s become a key point of contention between the IOC and Vancouver organizers — $30 million worth of sponsorship money.

Vancouver’s committee, known as VANOC, has repeatedly claimed it’s owed a further $30 million from the IOC’s take from major international sponsors.

Not so, says the IOC.

From the IOC’s perspective, its contractual obligation to VANOC has been met and even surpassed, says Gilbert Felli, the IOC’s executive director for the Olympic Games.

“We may have some more to come but it’s not an obligation of the IOC,” Felli told The Canadian Press.

Felli and Rene Fasel, the chairman of the co-ordination commission, say the IOC has given more to VANOC than any other organizing committee.

“We have also taken over the host broadcaster role, which used to be paid for by the (organizing committee) itself,” Fasel said in an email, adding the cost of doing so is worth about US$145 million.

“Since the beginning, we have also worked with VANOC to ensure that the core product was being delivered and have pointed out when we felt that perhaps some ’nice to have’ elements were unnecessary.”

VANOC’s claim comes from its 2009 budget, developed on the assumption IOC would be able to sign 11 international sponsors and give them $196 million towards their $1.75-billion bottom line.

That was despite the fact that during the bid phase for the Games, the IOC’s forecast for sponsorship was about CDN $127 million in 2002 dollars.

During the four-year period from 2005-08 that included the last Winter Olympics in Turin, Italy, and last year’s Summer Games in Beijing, the IOC had 12 worldwide sponsors that brought in nearly US$900 million.

Since then major backers Kodak, Johnson & Johnson and Manulife Financial have dropped out, leaving just nine worldwide sponsors, the lowest number since the worldwide program was started.

“We were making budget forecasts that were based on a buoyant economy, on ongoing discussions with the IOC, on the performance in Beijing as it related to sponsors,” said Renee Smith-Valade, vice-president of communications for VANOC, of the $196 million figure.

“We prepared our updated budget and then of course everything changed, the economy took a dive and everyone had to reanalyze.”

Just Posted

Red Deer’s crisis line workers are busy dealing with multiple emergencies

Callers need everything from mental health counselling to their basic needs met

Restaurant Brands International announces executive changes and raises dividend

TORONTO — Restaurant Brands International Inc. raised its dividend as it announced… Continue reading

Puck and player tracking gets TV test at All-Star Weekend

Twenty-three years after Fox’s glowing puck made its debut, the NHL’s next… Continue reading

Some Alberta minor hockey players getting heat for Indigenous locker room dance

FORT MCMURRAY, Alta. — The Fort McMurray Minor Hockey Association has apologized… Continue reading

2-for-1: Total lunar eclipse comes with supermoon bonus

On Sunday night, the moon, Earth and sun lined up to create the eclipse, which was visible throughout North and South America

Edmonton Oilers fire general manager Peter Chiarelli: reports

EDMONTON — Peter Chiarelli has been fired as general manager of the… Continue reading

Canadian Milos Raonic has Australian Open run end in quarterfinals

MELBOURNE, Australia — Canadian Milos Raonic is done at the Australian Open… Continue reading

$20K pay gap between women, men in Canadian tech jobs

The report defines tech workers as people either producing or making extensive use of technology, regardless of industry

Two Quebec short-film directors mark first Oscar nominations together

TORONTO — Two Quebec filmmakers celebrated in solidarity on Tuesday after learning… Continue reading

Toronto illustrator teams up with Paul McCartney on children’s book

Toronto-based illustrator Kathryn Durst says she’s found a true collaborator in Paul… Continue reading

Catholic student says he didn’t disrespect Native American

Many saw the white teenagers, who had travelled to Washington for an anti-abortion rally, appearing to mock the Native Americans

Backlund scores OT winner for Calgary Flames in 3-2 win over Carolina Hurricanes

Flames 3, Hurricanes 2 (OT) CALGARY — Mikael Backlund scored 15 seconds… Continue reading

Glendening’s two-goal performance leads Red Wings past Oilers 3-2

Red Wings 3, Oilers 2 EDMONTON — Luke Glendening had a pair… Continue reading

Most Read