Major cuts made to VANOC budget; but fears raised that they're going too far

[mr.x]

2010 Games faces cuts but fears raised that they're going too far

23 hours ago

VANCOUVER, B.C. — Vancouver Olympic organizers have been warned by their board of directors not to be overzealous and make budget cuts that would compromise the spirit of the Games.

A revised budget for the 2010 Games was presented to the board of directors Tuesday that included cuts to money being spent on accommodation and the banners and other elements that make up the "look" of the Olympics.

But the budget's gone back to the organizing committee over fear that too much was being chopped away in an effort to deal with the global economic downturn.

"It's the question we asked the management team," said Jack Poole, the chairman of the board of directors.

"To be sure that in the endeavour to cut the fat out of the budget, you don't start cutting muscle and bone. Is there a chance you've gone too far? We don't think so, but is there a chance that you have because that would be a mistake."

The current operational budget for the 2010 Winter Olympics is $1.62 billion, which does not include the $580 million for venues.

The operation of the Games is funded by ticket and merchandise sales, as well as sponsorship.

All three areas are going well for the organizing committee - they've raised $745 million of their $760 million sponsorship budget and requests for tickets have already topped $345 million.

Sponsors have made every payment, even those companies facing financial trouble like General Motors, said Dave Cobb, vice-president of marketing for the Olympic committee, known as Vanoc.

Cobb even announced Tuesday they'd signed up a new sponsor, to be named in the new year.

Still, everyone remains worried that something is going to go wrong as the world economy tanks and Canada teeters on the brink of recession.

"We went through a process of identifying areas in our budget where we can be more efficient and reducing future hires is one area to free up some money in case those revenues don't come through," Cobb said.

"If we carry on and continue to be very successful, we'll have an opportunity, six months from now or whenever the time comes, to potentially add some things back, but at this stage we think we need to be more cautious."

Organizers are also cutting down on the number of staff who travel on behalf of the Games.

The revised budget will be released early next year after it gets the final stamp of approval at the next board meeting.

"It's a balanced budget and the order of magnitude in the budget was roughly in the same place as it was," said John Furlong, the chief executive officer of the organizing committee.

He wouldn't say whether that means the $1.62 billion bottom line would stay the same.

And while Furlong has suggested organizers would like to cushion their contingency fund, Poole said Tuesday that might not be the case.

"I would say it's more likely to be less," he said.

He said in the "cash-in side" is what's at risk in the current economic environment.

At Tuesday's meeting, the board also approved prototypes for the gold, silver and bronze medals athletes will receive at the Olympic and Paralympic Games.

The designs are now before the International Olympic Committee and if approved, will be revealed late next year.

In addition, the board authorized $2 million for a chairlift to be installed at Whistler Creekside, the site of alpine skiing events in 2010.

Details were scant but organizers said it will only be in place for the Games and then be moved to another mountain afterwards.

The board meeting came as the International Olympic Committee prepared for its annual meeting in Lausanne, Switzerland beginning Wednesday.

At that meeting, the board will review preparations for the Vancouver Games, the 2012 Summer Olympics in London and 2014 Winter Games in Sochi, Russia.

London is struggling to secure private financing for its Olympic village, and Sochi must build virtually all its venues from scratch in much tougher economic conditions.

In a recent address to the European Olympic Committees, IOC president Jacques Rogge stressed the need for holding down costs.

"The Games are not anymore in a growth mode," he said. "They are in a conservation mode. ... We must make sure the Games do not become too sophisticated, too big and too costly."

[Yume-sama]

Hmm, no doubt a lot of changes will have to be made.

But as the article states, we're certainly a lot better off than Sochi 2014.

If it were any other Country than Russia, I would bet on the games not happening. But, they can't allow that no matter what.

[wrenegade]

Vancouver 2014?

[mr.x]

Even before these cuts, this was already one of the most modest organizing committee budgets in recent memory....and it's set to become even slimmer.





Four budget items to be fine-tuned

Damian Inwood, The Province
Published: Wednesday, December 10, 2008

Vancouver 2010 has asked Olympic officials to fine-tune four budget items, including reducing the future size of the workforce.

Board chairman Jack Poole said that while 2010 has not yet been hit by the economic downtown "it's a nervous environment and one that demands caution and extra diligence."

He said that while the budget was approved "in principle," the final numbers will be presented to the board in January and the budget released shortly after that.

"Anybody who is not nervous today, I would suggest, they are asleep," said Poole. "This is an environment that nobody alive today has experienced. It's the unknown unknowns that keep us awake at night."

Four areas that Vancouver 2010 must refine are:

- The $19-million "look of the Games" budget that deals with all signage and banners.

- The accommodation budget for workers in the Sea-to-Sky corridor.

- The full-time workforce numbers, originally set at 1,500, but which Poole says will now be "somewhat smaller than anticipated."

- Developing revenue through "innovative programs."

Vancouver 2010 CEO John Furlong said the new budget will be "roughly in the same place" as a $1.63-billion budget that was part of a business plan released in May 2007.

"We're not of the view that the review of these matters will change our budget estimates dramatically," he said.

The original budget contained a $100-million contingency but officials were not able to say how much bigger or smaller it may be in the revised figures.

Furlong said the new budget needs to be "resilient and robust enough to tackle anything that comes along."

He said existing staff won't be laid off but suggested some could be moved or redeployed.

Furlong said that all promised sponsorship dollars have been paid on time.

Marketing boss Dave Cobb said $745 million in domestic sponsorships have been committed, but there's a $15-million shortfall.

"We won't spend that money until we're confident we'll get it," he said.

Cobb said Vancouver 2010 regularly talks with the International Olympic Committee about $201 million it has committed from its international sponsorship program.

The IOC currently only has nine of 11 international sponsors and is short about $26 million, he said.

Cobb said the IOC is expressing "a high degree of confidence" it will fund the full $201 million.

NDP Olympic critic Harry Bains said the budget review is worrying.

"They are saying we have to wait another month for numbers," he said. "The fact the board has asked Vancouver 2010 to go back and do some fine-tuning shows that members are nervous."

[mr.x]

Vanoc to review revised 2010 Games budget Wednesday


By BRUCE CONSTANTINEAU, Vancouver Sun
January 20, 2009 3:01 PM

VANCOUVER - Fewer dollars for Games celebrations plus a smaller workforce plus new revenue sources equals a fatter contingency fund.

That's just one equation Vancouver Olympic organizers will consider Wednesday as they pore over a revised budget aimed at protecting themselves from financial uncertainties lurking in a global recession.

Vanoc board members last month approved in principle a revised budget but requested more "fine tuning" they could review this week.

Overseers of the $1.63-billion budget were to consider a smaller Games workforce, changes to the $19-million signage and banners budget, refinements to the accommodation budget for Sea-to-Sky corridor workers and the development of new revenue sources.

A $100-million contingency fund is expected to be expanded as Vanoc prepares for recession-induced financial hits.

Official 2010 Olympic supplier Nortel sought bankruptcy protection last week and while it remains "fully committed" to its $3-million-to-$15-million Games commitment, other sponsors also seem to be on shaky financial ground.

General Motors has committed $67 million in cash and in kind to the Games but needs a federal bailout to survive while Games metal supplier Teck Cominco has sold assets and cut capital spending to make its way through these tough times.

Games stakeholders fear Vanoc's cost-cutting mandate could jeopardize certain celebrations.

Whistler officials are already upset with a Vanoc proposal to scale back medals presentation ceremonies in their community, which were supposed to take place nightly at a new $13.6-million Celebration Plaza.

"We respect the challenges they have but are concerned that programs deemed very important for Whistler might be at risk," Whistler Mayor Ken Melamed said in an interview.

"I guess everything has to be on the table but I sense they have done their diligence and perhaps withdrawing the medals is the extent of program cuts at Whistler."

Kevin Wamsley, co-director of the International Centre of Olympic Studies at the University of Western Ontario, feels it will be hard for Vanoc to make substantial cuts from its previous budget.

"One would expect they were operating with a very efficient budget in the first place so that would mean there should be very little wiggle room for any more cuts," he said in an interview.

"It might be necessary to scale some events back and make them more spontaneous, as opposed to paying for extra fills like fireworks and light shows and entertainment."

Wamsley said it's never too late for Vanoc to sign up new sponsors if existing sponsors have to leave for financial reasons.

"But with just over a year to go, one would hope that everything is in place and the corporations have a legal obligation to take care of their commitments," he said.

"You wonder about the possibility of attracting new revenues in this economic climate. How many companies have the room to provide for an Olympic Games now when these things are seen to be elaborate and extra in the best of times?"

[email protected]
© Copyright (c) The Vancouver Sun

[SpongeG]

requests for tickets have already topped $345 million

requests doesn't mean sales though does it?

[mr.x]

Originally Posted by SpongeG

requests doesn't mean sales though does it?

There are something like $275-million in tickets, and only 10% of these tickets have yet to be sold and will go on sale early this year.

[rrskylar]

So the "B" Olympics hype is turning into just that?

[mr.x]

Originally Posted by rrskylar

So the "B" Olympics hype is turning into just that?

I think you're an idiot.

[rrskylar]

Good news Mr.x2... only 387 days left to mark off on your Vancouver Olympics calendar's, and for that warm and fuzzy feeling you get during those 16 days you will also get a 25 year's of memory's in having the rest of BC paying off the 4 billion dollar Olympic sized debt. Best Wishes!

[dreambrother808]

and another sad creature crawls out of the depths of the internet....

[jlousa]

Pretty sure Vancouver will have it's olympic debt paid off before Winnipeg gets the Jets back.

[mr.x]

Originally Posted by rrskylar

Good news Mr.x2... only 387 days left to mark off on your Vancouver Olympics calendar's, and for that warm and fuzzy feeling you get during those 16 days you will also get a 25 year's of memory's in having the rest of BC paying off the 4 billion dollar Olympic sized debt. Best Wishes!

$4-billion? Where did that come from??? I see you've been reading the tabloids....I mean, Canwest. The wannabe Fox of Canada....based in Winnipeg.

What was the last thing that happened in Winnipeg btw? The F-Olympics??? Also known as the Pan American Games.

[Dorian G.]

Originally Posted by mr.x2

I think you're an idiot.

It used to be that I would shake my head whenever I looked over the unmoderated forums at Discovervancouver.com; I realize now that a moderator is only a troll that has found her or his way onto the upper deck. Cretinism begets cretinism, and I would ask that at least those people ostensibly charged with fostering discussion maintain some level of civility.
Also, I like this quotation:

2010 Games faces cuts but fears raised that they're going too far | 23 hours ago | [mr. x. source uncertain]
VANCOUVER, B.C. — Vancouver Olympic organizers have been warned by their board of directors not to be overzealous and make budget cuts that would compromise the spirit of the Games.
* * *
In a recent address to the European Olympic Committees, IOC president Jacques Rogge stressed the need for holding down costs. "The Games are not anymore in a growth mode," he said. "They are in a conservation mode. ... We must make sure the Games do not become too sophisticated, too big and too costly."

The olympics have never, and will never be, at risk of being too sophisticated.
And in answer to your question, the Winnipeg Fringe Festival is the last thing that happened in Winnipeg (if you ignore the Museum to be built partially from the donations from the leader of "The wannabe Fox of Canada").

[rrskylar]

Originally Posted by mr.x2

$4-billion? Where did that come from??? I see you've been reading the tabloids....I mean, Canwest. The wannabe Fox of Canada....based in Winnipeg.

Winnipeg btw? The F-Olympics??? Also known as the Pan American Games.

Actually the $4-billion was wrong, now it's rumored to be more like $7-billion, just like the dullard Pan-Am games held in Winnipeg, nobody really gives a shit about the winter (B) Olympics other than hockey. BTW, What was the last thing that happened in Vancouver?

[Hong Kongese]

Originally Posted by jlousa

Pretty sure Vancouver will have it's olympic debt paid off before Winnipeg gets the Jets back.

I highly doubt that the Jets will ever return to Winnipeg!

[Spork]

City fight!

Maturity, disengage!

Winnipeg is poopy that their flowers are made of poop!

[mr.x]

Originally Posted by rrskylar

Actually the $4-billion was wrong, now it's rumored to be more like $7-billion, just like the dullard Pan-Am games held in Winnipeg, nobody really gives a shit about the winter (B) Olympics other than hockey. BTW, What was the last thing that happened in Vancouver?

Shit keeps falling out of your mouth lol. $7-billion lmao?


FYI, we held events that actually matter: Expo '86 and the Commonwealth Games half a century ago when they were equivalent to the Olympics.

You've clearly proven to everyone here that you are ignorant, with a tad or arrogance.

[ravman]

Well pardon my langauge

but VANOC is an idiot!

from what i hear... expect a gongshow at BC Place and GM Place... VANOC wants to run the show during the OLYMPICS with their rules and trust me not looking good... ( but then again, they are very secretive even though i work at the venues, they told us you will go through security background check and what not... usual stuff... but the sense is that we do all of what they say or nothing, but they wont tell us the full details and apparently a chunk of us are getting "fired" even though we dont work for VANOC

[mr.x]

Originally Posted by ravman

Well pardon my langauge

but VANOC is an idiot!

from what i hear... expect a gongshow at BC Place and GM Place... VANOC wants to run the show during the OLYMPICS with their rules and trust me not looking good... ( but then again, they are very secretive even though i work at the venues, they told us you will go through security background check and what not... usual stuff... but the sense is that we do all of what they say or nothing, but they wont tell us the full details and apparently a chunk of us are getting "fired" even though we dont work for VANOC

Dude, it's the Olympics....what do you expect? It's not like this is just another concert coming into the venue.

Everything they do is warranted, and security checks for everyone are probably recommended by the RCMP's 2010 security committee. There are definitely some serious security concerns.