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The [Olympic Tax] Papers

Does anyone but the local press corps believe the spin that, as the Tribune headline says, "Olympics Won't Cost Taxpayers, City Says" (or as the online version says, "Taxpayers Are Safe, Chicago CFO Says")?

"Chief Financial Officer Dana Levenson said the city would play a 'subordinate role' in the plan, which would kick in only if the Games were to operate in the red," the Tribune reports.

Duh!

In other words, the city will pick up the slack if things go sour!

Beyond that, to say the city's guarantee will be under so many layers of other financial guarantors that it is essentially meaningless is absurd. Then why require it?

The Tribune editorial board is a bit tougher on this new twist than the news reports.

"Chicagoans probably figured the mayor meant it when he said, at different times, that the Olympic Games can't 'cost any taxpayers any money' and 'you are not going to use local taxpayers' money' and it 'cannot become a financial burden to the taxpayers of Chicago and Illinois' and 'no tax dollars would be diverted,'" the board says. "Was the mayor being disingenuous? Or coy?"

Let me ask you something, Tribune editorial board: What do you think?

Maybe the mayor was too busy campaigning to explain how he intends to finance the Games.

Word Games
By the way, taxpayer dollars are already being used in time and manpower spent by city officials and the mayor's office preparing the bid. And if you think taxpayer dollars won't be spent as a matter of course - fixing streets and sidewalks and providing police officers and security measures - I have some beachfront properties in Indiana I'd like to talk to you about. No money down!

And there's no way that stadium - you know, the one with the bathrooms in the parking lot - gets built for $366 million.

Irony Avenue
You could end up paying for a stadium you won't be able to afford to enter.

Historical Record
Despite the city's assurances that profits are a cinch, the Olympics have a "history of failures," according to Ben Shields, the Northwestern University doctoral student who is one of the authors of The Elusive Fan: Reinventing Sports in a Crowded Marketplace.

"They're bidding on an idealized version of the Olympics, not the real thing," Shields said on Chicago Tonight last night.

Sports business consultant Marc Ganis was also on the show and was typically city-friendly, but his comments to The Los Angeles Times were much more critical of the locals: "I'm not sure our Chicago planners understood the magnitude of the issue to [USOC Chairman] Peter Ueberroth. Either you get this done or don't bother to try to come and play the game."

L.A. Story
Ganis's comments came in an L.A. Times story far more interesting to read than the Chicago versions of events.

The financing question "knocked Chicago bid officials and Mayor Richard Daley off a carefully choreographed message," the Times reported.

"At an afternoon news conference, Daley raised the possibility that city tax dollars might be used, a reversal of his previous comments. He said they were working on achieving guarantees with both private and public [funds].'

"'There's a concern the U.S. Olympic Committee has,' Daley said, 'and rightly so, and we'll come up with a plan shortly.'

"The mayor then spent most of the question-and-answer session refusing to provide specifics about the guarantees."

Welcome to Chicago!

University of Chicago sports economist Allen Sanderson told the Times that "Chicago has had two recent big-ticket items. Millennium Park was put out at something like $150 to $175 million and came in at $475 [million]. The rebuilding of the Dan Ryan Expressway, which was budgeted at $500 million, will now run over $1 billion.

"There's no way the Olympic cost would not follow that sort of model. I just would like something that would pass Accounting 101."

The Times also noted that, contrary to assertions made by Chicago officials, "No such [financing] requirements were made of the other finalist, Los Angeles, about its plans to temporarily enhance the Coliseum, costing $112 million. In fact, there have not been any follow-up questions from the evaluation commission, according to a bid official, suggesting a high degree of comfort with L.A.'s plan.

Big Jim
An insightful Beachwood reader suggests that "the Illinois Sports Facility Authority will end up funding this stadium or some part of it. Jim Thompson is the chair of the ISFA and now is taking a dominant role in the Olympics thing."

Olympic TIF
They proposed it in New York.

When one official said "No existing tax money will be used," the Village Voice reported that "That word - existing - was not chosen lightly. For [New York's] West Side dreams absolutely would require public money: at least $3 billion of it, for everything from an Olympic stadium to expanding the Javits Convention Center to - the big-ticket item - extending the No. 7 train to Eleventh Avenue. But in [this] vision, all this would be 'new' tax money: funds that would be created by the very development they were helping to build."

Memo to Ben Joravsky: Get on it!

(Hat tip to fieldofschemes.com)

Credibility Gap
"[Chicago CFO Dana Levenson] said the USOC is requiring the same kind of guarantee from Los Angeles. But David Simon, president of the Los Angeles bid committee, said it so far has only been asked for guarantees on the facility construction costs - which are expected to be small, as most of Los Angeles' potential Olympics facilities already exist," Crain's reports.

"When the USOC Evaluation Commission visited Los Angeles last week, 'we had two days of meetings here, and (an operating budget guarantee) did not come up,' Mr. Simon says."

PR Games
"Chicago would be an ideal location for the 2016 Summer Olympics, but the games must provide long-term benefits for the people of Chicago and must not burden taxpayers, Mayor Richard M. Daley said today," a press release on the city's website states.

"Real safeguards must be in place to protect the city's finances and our taxpayers," the mayor said. "This effort cannot become a financial burden to the taxpayers of Chicago and Illinois."

At least not until after the election.

West Coast Vibe
"While members of Chicago's 2016 Olympic bid committee fretted over how they will guarantee the millions of dollars they need to build their dream, their Los Angeles counterparts partied the night away at Paul Allen's Beverly Hills mansion," the Times reports.

It's hard to see how a Heartland Olympics could compete with that, but then again Atlanta won the Games in 1996. And the way they did it certainly bodes well for Chicago's chances.

Meat's a-cookin', boys!



Permalink

Posted on March 9, 2007


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