A committee that was struck to explore the possibility of launching another Olympic Bid has determined that it will likely cost Calgary taxpayers about $2.4 billion to host the games.
The Calgary Bid Exploration Committee (CBEC) presented its findings to council on Monday and estimates the total cost to host the 2026 Olympic and Paralympic Winter Games at $4.6 billion.
The CBEC says $2.2 billion would come from revenue generated from the games but that the city would be on the hook for the rest of the costs.
The committee says operating costs are expected to exceed operating revenues by $425 million and that a number of additional costs need to be considered like security, accommodations and facility construction and renovations.
Officials say existing facilities would be reused and upgraded to reduce the funding requirements.
The budget includes a contingency of $450 million as well as $135 million for endowments to ensure the facilities can continue to be used after the games.
“One of the things we identified from looking at some prior Olympic Games was the failure to account for post-Games operation and maintenance of facilities in their budgets,” said Rick Hanson, CBEC Chair, “While this adds cost, our Board felt it was a necessary addition to a prospective budget.”
It is estimated that the IOC will contribute about $700 million to host the games and that another $1.14 billion will be generated through domestic sponsorships and ticket sales.
According to research by the Conference Board of Canada and Deloitte LLP, the games could bring in between $2.2 and $2.6 billion in GDP, which includes about $500 million in tax revenue.
“When looking at the economic impact, those are things that we know are going to be scrutinized. We had two different organizations do the impact assessment for us and so those are the numbers we’re presenting,” said Hansen.
The committee added that it would also need to build two NHL sized arenas and a new fieldhouse and the mayor says he’s concerned about running an operating deficit in the $450 million range.
“I can get my head around finding capital for this. I'm going to have to take a lot of convincing to be told we should be running an operating deficit in that range while other parties like the IOC and the COC actually make a lot of money off of sponsorship and TV rights so really the risk cannot entirely be held by the host city, in my opinion, so there remains a lot of questions I want to ask,” said Mayor Nenshi.
“It’s clear that we need two arenas to host the games, there was in Vancouver, there will be for any winter games and we’re relying on the fact that we just identify the information, we identified the venues that are required and then we just wait and see the decisions that are made in council and whether they support what’s necessary for the games,” said Hansen.
The committee will consider its final recommendations over the next month and will present its report to the city on July 24th.