New Olympic Bid for Calgary?

[octothorp]

Originally Posted by Frequitude

I will gladly have a party in my city and all the associated infrastructure on someone else's dime. 'bout time. If its net-positive to Calgarians (including our share of provincial and federal funds) then why the hell not.

That should have been the slogan last time..."'bout time we got something with someone else's money".

Get David Foster to write a theme song around that and we're set.

[chemgear]

Originally Posted by Frequitude

Got any data on summer vs winter? I imagine 172% is greatly skewed by summer since it is so much bigger and needs so many facilities. Winter gets to benefit greatly from gravity and mountains being free.

Apparently summer games overran their budgets by 213 percent so they ended up spending more than 3 times what their bid claimed.

Winter games overran budgets by 142 percent so about 2.5 times what their bid claimed.

Lol at the thought that we would magically be getting "somebody else's" free money to build and upgrade infrastructure. ####ing crazy, I mean hopes and dreams for financial planning. Especially when the Federal government had already explicitly told Calgary that it would not be responsible for any overruns.

Eating literal billions of dollars in obvious overruns = magical free money to some people

[Leondros]

Originally Posted by chemgear

Apparently summer games overran their budgets by 213 percent so they ended up spending more than 3 times what their bid claimed.

Winter games overran budgets by 142 percent so about 2.5 times what their bid claimed.

Lol at the thought that we would magically be getting "somebody else's" free money to build and upgrade infrastructure. ####ing crazy, I mean hopes and dreams for financial planning. Especially when the Federal government had already explicitly told Calgary that it would not be responsible for any overruns.

Eating literal billions of dollars in obvious overruns = magical free money to some people

Its still incrementally $1B directly to infrastructure to the city from the province and federal government that otherwise would not have been received.

Scenario 1 (100% overage assumed): You build a house, and I gave you a $1M budget and you said yes, and then built it and it turned out to be $2M because of inflation, overruns, terrible unbudgeted issues.

You pay $2M and get a house.

Scenario 2 (100% overage assumed on both house and party): You build a house and throw a party. I give you a $1M budget for the house and a $500K budget for the party. I will help you pay $500K for the house and $500K for the party. Your house ends up costing $2M and the party $1M.

You pay $2M and get a house and a party which allowed you to meet your neighbors, and create some future business connections improving your future earnings.

Which scenario would you rather have?

The federal and alberta government were going to cover virtually all of the operating expenses of the 'party' while providing over a $1B in capital improvements budgeted at $1.6B...

[Weitz]

If it’s such a good deal why isn’t everyone clamouring to host it?

[chemgear]

Originally Posted by Leondros

Its still incrementally $1B directly to infrastructure to the city from the province and federal government that otherwise would not have been received.

The bid budget was what in total? Like $5 Billion? So the average overrun for winter games at 142% so Calgary would be eating an overrun of something in the order of $7 Billion let's say.

So to get $1 Billion of "free magical money", we would need to go $7 Billion into debt.

[Leondros]

Originally Posted by Weitz

If it’s such a good deal why isn’t everyone clamouring to host it?

Thats like looking at a business for sale and asking why everyone isn't in a bidding war for it. Certain things need to make sense for a host city:

- do they have a cost advantage they can leverage? Proximity to mountains, not having to build venues from scratch, enough people, enough money, support of a government, etc.
- will they benefit from doing the Olympics? future tourism, capital improvements, economic upheaval directly from the event
- do they have the existing infrastructure to host? enough hotels, large enough population, large enough city
- do they have a social/cultural ability to host?

A lot of things need to be considered for each host city and one size certainly does not fit all.

[Leondros]

Originally Posted by chemgear

The bid budget was what in total? Like $5 Billion? So the average overrun for winter games at 142% so Calgary would be eating an overrun of something in the order of $7 Billion let's say.

So to get $1 Billion of "free magical money", we would need to go $7 Billion into debt.

Your assumptions are too simplistic. Part of the budget was $2.2B in private funding made up of the IOC contribution, ticketing, sponsorship and licensing. Not on the tax payer at all.

In addition, I looked at your source for the 142% and would like to point out it is highly skewed by the data point for Sochi at 289%. If I look at just the Canadian Olympic overages I get 39% (Vancouver at 13% and Calgary at 65%) which I argue are better proxies for the way our country does construction and sets contracts.

[afc wimbledon]

The trouble with relying on Federal money for your games is you are using up your federal money for skating rinks and ski jumps when you should really use it for better rail access to the suburbs

[GGG]

Originally Posted by Leondros

There was a 56 page report commissioned and conducted by one of the big 4 firms and did an extensive cost-benefit analysis. The voters were stupid...

That picture shows the voters were smart.

Prior to cost overruns the best the Olympics were going to do was spend tax dollars on infrastructure. We can do that without the Olympics. It also assumes that the infrastructure constructed is 100% useful and the dbm for said infrastructure isn’t inflated by Olympic requirements.

I mean the best case scenario based on that report was spending more tax dollars on infrastructure we didn’t 100% need. And keep in mind that the report was done with a set of assumptions being provided to the big 4 company that was likely to show this. These types of reports are rarely done without the answer knowing in advance. So the best they could do was break even.

This also assumes that you believe that Federal dollars and provincial dollars not spent in Calgary are just lost and we should line up at the pork trough because others do.

No the voters weren’t stupid, they had a different assessment of the same information as you did.

[chemgear]

Originally Posted by Leondros

Your assumptions are too simplistic. Part of the budget was $2.2B in private funding made up of the IOC contribution, ticketing, sponsorship and licensing. Not on the tax payer at all.

In addition, I looked at your source for the 142% and would like to point out it is highly skewed by the data point for Sochi at 289%. If I look at just the Canadian Olympic overages I get 39% (Vancouver at 13% and Calgary at 65%) which I argue are better proxies for the way our country does construction and sets contracts.

The study from the University of Oxford?

https://towardsdatascience.com/how-b...s-46e803cbf7d5

Yeah, if you don't like Sochi and exclude the data point the average goes from 142% to 128%

Not sure I understand - if there overruns who is paying for them. We already knew the federal government would not. You're saying the IOC and private entities would pay for it?

[Titan2]

Originally Posted by Leondros

There was a 56 page report commissioned and conducted by one of the big 4 firms and did an extensive cost-benefit analysis. The voters were stupid...

First of all, a 56-page report is not how you communicate benefits to voters. It may be the basis for it, but it has to be communicated in digestible chunks for the average voter.

Second of all, I am not sure who you pay your taxes to but other than Canmore, all of that comes out of my pocket. How is that free money?

[Leondros]

Originally Posted by Titan2

First of all, a 56-page report is not how you communicate benefits to voters. It may be the basis for it, but it has to be communicated in digestible chunks for the average voter.

Second of all, I am not sure who you pay your taxes to but other than Canmore, all of that comes out of my pocket. How is that free money?

Because if you don’t spend it good luck seeing any provincial and federal money otherwise. These governments both have this kind of funding tucked away exactly for this purpose. It’s not some general use basket you can allocate to the ‘benefit me as a Calgarian fund’.

[Leondros]

Originally Posted by chemgear

The study from the University of Oxford?

https://towardsdatascience.com/how-b...s-46e803cbf7d5

Yeah, if you don't like Sochi and exclude the data point the average goes from 142% to 128%

Not sure I understand - if there overruns who is paying for them. We already knew the federal government would not. You're saying the IOC and private entities would pay for it?

Yes, the report was from Oxford - correct. My point is using an average of all Olympics likely isn’t a good proxy. Building and operating in Canada is different than other countries such as Russia or even Italy. These data points are going back to the 70s and wary 80s which were completely different economic realities. In addition, Calgary’s whole bid was predicated on existing infrastructure which was supposed to reduce the risk of overruns.

I was just pointing out that some of the funding also came from private sectors which weren’t shown in figure 9 of what I provided. That’s further funding outside of the tax payer. They certainly wouldn’t cover overages.

[powderjunkie]

Originally Posted by GGG

That picture shows the voters were smart.

Prior to cost overruns the best the Olympics were going to do was spend tax dollars on infrastructure. We can do that without the Olympics. It also assumes that the infrastructure constructed is 100% useful and the dbm for said infrastructure isn’t inflated by Olympic requirements.

We could...but we won't.

Any regrets over '88?
Does Vancouver regret 2010?

I think any report showing anything close to a breakeven is almost certainly disingenuous, but I'm still on team: why the hell not? Let's do it!

[FireGilbert]

The Brisbane Olympics costs are already spiralling out of control. Over $1 billion to renovate a perfectly fine cricket stadium, including relocating a public school, feels like an irresponsible spend.

https://www.abc.net.au/news/2022-08-...pics/101313346

The Queensland Premier has flagged the cost of redeveloping the Gabba for the 2032 Games could increase beyond the proposed $1 billion price tag.
It comes after Annastacia Palaszczuk said she was comfortable with plans for both the Gabba and Brisbane Live after concerns were raised last week additional construction was needed to allow the venues to be built for the 2032 Olympics.

Speaking at a media conference yesterday Ms Palaszczuk said there would be a business case for the Gabba redevelopment, with the government "working through all those issues at the moment".

When asked how the government had determined the redevelopment would cost $1 billion, Ms Palaszczuk said it was based on cost estimates at the time.

[chemgear]

Originally Posted by Leondros

Yes, the report was from Oxford - correct. My point is using an average of all Olympics likely isn’t a good proxy. Building and operating in Canada is different than other countries such as Russia or even Italy. These data points are going back to the 70s and wary 80s which were completely different economic realities. In addition, Calgary’s whole bid was predicated on existing infrastructure which was supposed to reduce the risk of overruns.

I was just pointing out that some of the funding also came from private sectors which weren’t shown in figure 9 of what I provided. That’s further funding outside of the tax payer. They certainly wouldn’t cover overages.

Okay, let's agree and say we toss out all the other data points and just use Calgary in 1988 at 65%. (Which I would suggest is conservative given inflation these days and the wild insanity of how the bid budgeting hand waving when questions were bring raised in the waning days before the vote).

So call it an extra $3+ billion as an overrun.

Again, I'd say that we would be eating that. Not the federal government and we agree the private sectors are not going to be helping. And going back to reading the news at the time, the IOC explicitly said they would not be helping on any overruns either.

[afc wimbledon]

Nice to see the Vancouver Games were quite well run

[Leondros]

Originally Posted by chemgear

Okay, let's agree and say we toss out all the other data points and just use Calgary in 1988 at 65%. (Which I would suggest is conservative given inflation these days and the wild insanity of how the bid budgeting hand waving when questions were bring raised in the waning days before the vote).

So call it an extra $3+ billion as an overrun.

Again, I'd say that we would be eating that. Not the federal government and we agree the private sectors are going to be helping. And going back to reading the news at the time, the IOC explicitly said they would not be helping on any overruns either.

Sure - but Vancouver was cheaper. I wonder why that was given they had to build all new infrastructure. Now is that $3B overrun associated with operating or capital? Capital overruns would in theory have irregardless of it was the Olympics or not - that was simply the cost of what it is to build that infrastructure for the city.

[getbak]

Originally Posted by Weitz

If it’s such a good deal why isn’t everyone clamouring to host it?

For the Winter games, there are only so many cities around the world that realistically can host.

A city needs to have winter weather, a close proximity to mountains of adequate size, and a central city or region that can support the number of arenas required for a modern Olympics. For arenas, you need a speed skating oval with a capacity of at least 8,000; a curling rink with a capacity of at least 6,000; a secondary hockey venue with capacity around 6-8,000; and two major arenas with capacities over 15,000 for the primary hockey and figure skating venues. The central host also needs adequate hotels, transportation, and other supporting infrastructure for the athletes, media, and fans who will attend.

In Canada, Calgary and Vancouver are really the only viable options. In the States, it's probably just Salt Lake and Denver. The Winter Games have outgrown places like Lake Placid and Olympic Valley. They could possibly look at places like Seattle, Portland, San Francisco, or Boston to host the arena-based events with the mountain events at the close(ish) ski resorts.

In the rest of the world, the Southern Hemisphere is essentially a write-off, and anything south of the regions that have already hosted (Northern California, Japan, South Korea, China) aren't likely viable either. In Europe, the places that have hosted before are mostly small ski resort towns that would need to partner with a larger city to serve as the main host.



A big advantage that we have in North America is that our most-popular sports are arena-based, so we tend to already have the big arena venues in place and they don't need to be built from scratch like in some parts of the world. Those tend to be the most-expensive venues to build too.

Take Boston for example, if they ever hosted the Winter Games, the only arena they would need to build would be a speed skating oval. Between the Garden and all the AHL and NCAA arenas in New England, they would be able to host every other indoor event in an existing arena.

[chemgear]

Originally Posted by afc wimbledon

Nice to see the Vancouver Games were quite well run

Originally Posted by Leondros

Sure - but Vancouver was cheaper. I wonder why that was given they had to build all new infrastructure. Now is that $3B overrun associated with operating or capital? Capital overruns would in theory have irregardless of it was the Olympics or not - that was simply the cost of what it is to build that infrastructure for the city.

Indeed.

Interesting point about the Calgary Olympic bid that ties into that. Vancouver spent 5 times the amount they originally thought they would for security at just under $1 billion. Apparently average security costs for the Olympics are around $1.3 billion.

The Calgary Olympic bid budgeted less than $500 million. When confronted with the difference, they claimed that the federal government would "sign a guarantee" later and that the guarantee would somehow cover any overruns. The federal government immediately called bull#### and explicitly said no.

I mean are you lying, incompetent, blindly optimistic or all of the above?

https://www.cbc.ca/news/canada/calga...dget-1.4893885

Take what you will from that for the quality of their bid budget estimate numbers from there. I would suggest that there was a lot of hair and built in lowballing in their cost numbers.


EDIT: From the article:

Millar said the bid corporation anticipates the federal government will sign the security guarantee later this year, which would also cover any security cost overruns.

. . .

"Within our federal hosting policy, we are not responsible for cost overruns," Duncan said Friday.

"The number ($495 million) seems really low to me," said Heine.

"These are usually, typically, billion-dollar considerations to provide security, plus cyber-security, which is a new key arena for this debate," he said.

Heine is also uncomfortable with the suggestion that more volunteers and private security guards be used during the Games.

"That seems very implausible to me," he said.