Vancouver Olympics to get extra money from IOC if there’s a budget shortfall
Unspecified amount would be provided, as Vanoc deals with lack of two top-level international sponsors categories
By Jeff Lee, Vancouver Sun
August 26, 2009 5:01 PM
The International Olympic Committee said Wednesday it will give extra money to the organizers of the Vancouver 2010 Games after the event if there is a budget shortfall.
In an agreement reached this week, the IOC said it will provide an unspecified amount to the Vancouver Organizing Committee post-Games if it cannot balance its budget.
It said it was aware Vanoc had created an operating budget that depended upon $30 million in royalties the IOC has so far been unable to provide from two top-level international sponsors categories.
Gilbert Felli, the IOC's executive director of Olympic Games, wouldn't give a figure but said the IOC has proposed making a payment should Vanoc run the risk of a deficit.
"Due to the difficulties here that we are discussing with Vanoc that they may have deficit at the end, the IOC has made a specific proposal to Vanoc," Felli said.
The arrangement was announced at the wrap-up news conference for the final meeting of the IOC's Vancouver Coordination Commission. The 11-member panel, including IOC members and technical specialists, were in Vancouver for two days.
Rene Fasel, the commission's chair, said the commission had concluded "Vancouver is ready for the 2010 Olympics."
"We are reaching the end of this fantastic journey," he said, predicting that Vancouver's Games would be "an unparalleled success."
The financial uncertainty affecting Vanoc and the IOC overshadowed much of the commission's visit.
Dave Cobb, Vanoc's executive vice-president of marketing, revenue and communications, said the committee is trying to close the gap by signing other sponsors finding new sources of revenue and is "increasingly confident" that it won't face a budget shortfall. Still, the IOC's promise of relief put a smile on his face.
"It was a very positive commitment for us," he said.
"Obviously we've been in unprecedented financial times and we've managed, relatively speaking, very well. But it's nice to know the IOC will be there to help us if we need it."
Cobb said the IOC is contractually obligated only to provide royalties from international sponsors it signs. It had told Vanoc to plan for 11 sponsorships, but has so far has only signed nine. In the meantime, Vanoc built a $1.7-billion operating budget based on the original promise, leaving it with a $30-million gap.
"The ($30 million) is not contractually owed to us," Cobb said.
But with less than six months to go before the Games, Vanoc can't cut back its $1.7-billion operating budget by the missing amount without seriously having an impact on its plans, he said.
Cobb said the unusual arrangement has been under discussion for several weeks but only concluded while the coordination commission was in town.
Cobb said he doesn't expect a $30-million bailout from the IOC, but rather assistance only if Vanoc doesn't balance its budget at the end of the Games. "This is in no way a blank cheque, he said.
"I think every day that goes by we move further towards our targets."
The IOC said it still hopes to sign at least one top sponsor before 2010. On Tuesday, Dmitry Chernyshenko, the chief executive of the Sochi 2014 Games, said the IOC was in discussions with a major Russian diamond company.
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