BC Business
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These were the first Winter Olympics held outside of Europe and North America, and the Japanese spared no expense in an attempt to impress, spending an astronomical $688 million. The ski runs were scooped out of mountainsides; the men’s slalom course alone required the removal of more than 12,000 cubic metres of rock, most carried out on human backs. Austrian skiing champion Karl Schranz was banned from the Games by the International Olympic Committee (IOC) for accepting money from ski companies. In response, Schranz’s supporters threatened to burn the home and kill the children of Karl-Heinz Klee, president of the Austrian Ski Federation. The Games raised the profile of Sapporo and its annual Snow Festival and helped establish the city as a major conferencing and sporting destination.
Innsbruck became the site for the 1976 Games after the citizens of Denver, the original bid-winner, voted in a 1972 public referendum against playing host. Instead of extravagance, the Austrians opted for modesty and thrift, dubbing the show “the Simple Games.” There was no stadium built for the opening ceremonies and no expensive pageantry. In the wake of the massacre of Israeli athletes at Munich in 1972, the security-conscious Austrians hired 5,000 police and soldiers to patrol the Tyrolean town and the Olympic sites. “It looks like a POW camp,” said Italian figure skater Susan Driano. Because Innsbruck had hosted the Winter Games in 1964, the Austrians had the benefit of having much of the necessary infrastructure in place and savvy, experienced management. The total cost was $85.6 million. All the facilities were put to use afterwards. “There are no Olympic ruins at Innsbruck,” declared Olympic committee spokesman Bertl Neumann
Lake Placid chose the slogan Welcome World, We’re Ready, but the tiny resort town (population 2,800) was anything but prepared. Because there were only 5,600 beds, the 50,000 daily visitors had to find accommodations in distant towns and cities. Olympic organizers banned public cars from the vicinity of town and created a series of outlying parking lots from which buses would ferry spectators to the venues. The plan went badly awry: drivers got lost, buses were late arriving and there weren’t enough of them. Catastrophe was averted when state governor Hugh Carey declared a limited state of emergency and authorized the importing of more buses and drivers. The Games ended with a $6-million deficit and the Lake Placid Olympic Committee preparing bankruptcy papers. New York State eventually came to the rescue with a bailout.
Socialist Yugoslavia wanted to host the Games for capitalist reasons: to transform the Sarajevo region into a winter sports destination and boost tourism. At the time, Yugoslavia was beset with an inflation rate of 50 per cent, a $20-billion foreign debt and high unemployment. Public support for the venture was high: when the government proposed raising taxes to pay for Olympic construction costs, the move was approved by 96 per cent of voters. Although the Yugoslavian government had to borrow funds from foreign banks and the IOC to finance the Games, the organizing committee later recouped its costs thanks to licensing agreements, sponsorships, advertising, donations, tickets and the sale of television rights. The euphoria was short-lived. Eight years later the country was engulfed by ethnic warfare and Sarajevo besieged, its ski slopes riddled with bunkers, its hotels scorched by rocket fire and its Olympic grounds covered with grave makers.
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Calgary’s entrepreneurial approach, which supposedly resulted in a $150-million operating profit, is often cited as an example of how to stage a financially successful Winter Games. However, a 1999 investigation by the Toronto Star revealed that Calgary’s organizing committee omitted the cost of building sports facilities from its figures as well as $461 million in government subsidies. Include them and the Games lost money. It was not the only shortfall. The promised low-income housing never materialized, an estimated 50 per cent of the available tickets went to IOC insiders (resulting in large blocks of empty seats at many events) and Canada won no gold medals. The most positive legacy of Calgary’s Games was the construction of state-of-the-art sports facilities, most notably the Olympic Oval – the world’s first fully enclosed speed skating rink, which would produce a steady stream of future Canadian Olympians.
Albertville landed the Games hoping to revitalize an ailing economy and stimulate flagging tourism in the French Savoy Alps. Because all the various municipalities in the region wanted a piece of the action, the 57 Olympic events were spread out over 13 locales and 620 square kilometres, which produced a logistical nightmare. The French government spent $1.1 billion on regional infrastructure. Another $189 million was invested in building or upgrading sports facilities. Organizers declared a loss of $67 million. An expected boost in tourism did not materialize for Albertville, which instead found itself saddled with a huge deficit caused by cost overruns. Other towns in the region suffered the same fate, while some places, such as Courcheval and Val d’Isere, prospered from the improved transportation links.
The Norwegians confounded skeptics by staging a successful Winter Olympics in a sleepy town of 23,000 inhabitants that had virtually no major sports supply businesses, facilities or infrastructure. These were the first “green Games.” Recycling was stressed, cars were banned within a 60-kilometre radius of the venues and contracts signed with sponsors and suppliers contained environmental clauses. Contractors of the luge and bobsled runs were fined $7,400 for every tree that was needlessly damaged. But despite predictions about the Olympics’ positive impact on tourism, within a few years 40 per cent of the hotels built in and around Lillehammer for the Games had gone bankrupt and two large alpine skiing facilities built for the Games had been sold for less than $1 to prevent bankruptcy.
Dark rumours swirled as to why Nagano, a city of garish urban sprawl, with no airport and at the same latitude as Algiers, won the Games. The Nagano Olympic Committee spent $800 million on sports facilities, including $80 million for a ski jump with an Astroturf surface for summer use and $100 million for a bobsled and luge course. Most of these facilities fell into expensive disuse after the Games. The Japanese government built a new bullet train between Tokyo and Nagano that reduced the travel time from three hours to 79 minutes, but it cost $7 billion. Virtually everything ran over budget, though no one is sure of the true deficit because 90 volumes of accounting documents mysteriously disappeared. In 1999 Nagano committee vice-secretary-general Sumikazu Yamaguchi admitted, “I ordered them burned. I didn’t want the IOC members to feel uncomfortable.
Before the Games, the leaders of the Salt Lake City Olympic Organizing Committee had to resign after being accused of spending millions of dollars to improperly influence the votes of 14 IOC members. The payments included cash, all-expense-paid ski trips, college tuition payments and free plastic surgery. Salt Lake spent $2 billion (including $500 million for security), which works out to a staggering $114 million per day or $817,000 per athlete. While organizers reported an overall $101-million profit, critics claim this figure omitted federal government subsidies. The Olympics brought international acclaim, dozens of new and faster lifts and thousands more hectares of skiable terrain to the region. Traffic on the slopes was up by 37 per cent in the six years after the Games, turning Utah skiing into a US$1-billion industry.
Turin hoped the Games would revitalize a sagging local economy that had been devastated by the collapse of the Fiat empire. The lead-up to the Olympics was a litany of monetary headaches, construction gaffes, political infighting and financial scandal. In 2004 police charged nine executives from the company contracted by the government to build the 65 infrastructure projects needed for the Games, accusing them of fixing bids and abusing their authority. Attendance fell short of predictions, possibly because the online ticketing process was plagued by malfunctions, while a $215-million shortfall in the Games’ $3.6-billion budget was blamed on lacklustre sponsorship support from corporations. The difference was made up by the Italian government. Turin would become only the second Winter Olympics in the last 30 years to report a deficit.