L.A. to Bid for 2012 Summer Olympic Games

Los Angeles organizers today will announce intentions to bid for the 2012 Summer Olympics. The bid is expected to show enough readiness that it could be workable in 2004, should preparations for the Athens Olympics falter.

Los Angeles held Olympic Games in 1932 and 1984, and a third would be unprecedented.

The key to the bid is existing facilities. A to-do list of expensive construction work is short. Ready to go now are a host of world-class venues, including several built since the 1984 Games, such as Staples Center and the Arrowhead Pond in Anaheim. A few sites in Southern California would need renovation. The Los Angeles Memorial Coliseum would need to be fitted--again--with a running track. But only one facility of 33, a shooting range, would have to be built from scratch, at organizing committee expense.

Los Angeles bid officials thus promise a privately financed Summer Games and predict a financial and logistical success.

Although Los Angeles officials stressed that the bid is for 2012, the package could easily be ready to take over in 2004 in the unlikely event that Greek organizers fail to have Athens ready for the next Summer Games. The International Olympic Committee is closely monitoring Athens’ halting progress. Los Angeles and Seoul are frequently mentioned as alternate sites for 2004, although after a recent IOC inspection, Athens was given assurances that the Games would not be moved.

Salt Lake City Scandal May Taint U.S. Bids

The bid’s success is hardly a sure thing. In the wake of the Salt Lake City bidding corruption scandal, some in the Olympic movement think it will be decades before the games again are awarded to a U.S. city.

Yet on the plus side for Los Angeles, officials here note, is that key local figures in the 2012 bid are known and respected in Olympic circles. The bid team lined up Los Angeles City Council support in 1998. And, perhaps most important, bidders project a budget surplus of $96 million on revenues conservatively estimated at $2 billion.

Seven other U.S. cities are expected to submit bids to the United States Olympic Committee by Dec. 15, the deadline. At least that many cities from around the world are also likely to try for the Games. Rio de Janeiro is already well into an unofficial campaign for 2012; the Games have never been held in South America.

Decision time is still years away. The Olympic bid process takes so long that a child now in first grade will have just graduated from high school by the time the 2012 Games begin--on July 27, 2012, at the Coliseum, if the L.A. campaign is successful.

In 2002, the USOC will back one of the eight presumed American contenders. That will be followed by a three-year global campaign. In 2005, the IOC will choose the host city for the 2012 Games.

The L.A. 2012 plan is to assert to those who matter that “been here, done that” is a recipe for making money and memories.

“We can win in the next round because of our history,” said David Simon, president of the L.A. 2012 board. “The Olympic movement knows Los Angeles, understands our capabilities. We have credibility.”

The 2012 bid offers a few new twists. For example, organizers envision this course for the Olympic triathlon: Swim off Venice Beach, bike through Hollywood, run around downtown. There was no triathlon in 1932 or 1984. Organizers project the gymnastics competition at Staples and basketball at the Pond.

“This bid is about doing it right, about doing it right for the athletes,” said Richard B. Perelman, who drafted the nearly 600 pages of technical material demanded by Olympic officials for the 2012 bid, and who played a key role in press operations during the 1984 Games.

He added, “The philosophy we’re using now is the same as ‘84: existing facilities. Private-sector financing and organizing. And protection of taxpayer liability.”

Details of the L.A. 2012 bid will be unveiled at a 10 a.m. news conference at Staples Center. John Argue, chairman of the bid committee, will make a presentation at noon today at the Biltmore Hotel downtown as part of the regular Town Hall lecture series.

Between now and 2005, much depends on the success of the Salt Lake Games and the 2004 Summer Games at Athens--as well as on the usual economic, political and cultural variables.

Preparations for the Athens Games have been marked by revolving-door leadership and stalled progress on hundreds of construction projects. On Monday, Petros Synadinos, the No. 2 executive of the Athens 2004 organizing committee, resigned, citing personal reasons.

Despite IOC assurances, it remains unclear whether Greek organizers have the resources and political will to manage the complexities of the modern Games, and some in the IOC have suggested that the 2004 Games could be moved. Publicly, IOC leadership has stressed that there is “no Plan B.”

“We’re the 2012 bid committee,” Simon said, “and we have not been asked by any Olympic official to even take a look at the question of 2004. We wish Athens well and hope the Games there are very successful.”

Anti-U.S. Sentiment

If the vote for 2012 were today, any American candidate would have at best a slim chance of prevailing. Anti-U.S. sentiment remains considerable in the IOC because of the Salt Lake City scandal, which rocked the Olympic movement last year.

Speaking over the weekend at a USOC meeting in Washington, Mitt Romney, head of the Salt Lake Organizing Committee, predicted that the Olympics will not return to the United States for more than 20 years after the 2002 Games.

He said there’s “not a prayer” the U.S. will get the 2012 bid--not because of the corruption scandal but because cities such as Istanbul, Kuala Lumpur and Beijing now have the infrastructure and financial ability to stage the Games, which they previously did not.

On the other hand, the movement is tied to American financial and corporate support. Nine of the IOC’s 11 key corporate sponsors are American. NBC is the IOC’s single largest financial underwriter.

And Olympic history shows that since 1960--when television began assuming a central role in the way the Games are financed and staged--the IOC has never stayed away from North America for longer than eight years.

If, as many Olympic insiders expect, Beijing gets the 2008 Games, the IOC will be overdue to return to these shores--to follow up Salt Lake in 2002 and Atlanta in 1996.

Los Angeles organizers say the Games’ history of success here gives them an edge on the cities that will be their presumed U.S. challengers: Cincinnati, Dallas, Houston, New York, San Francisco, Tampa and Washington-Baltimore.

The 1984 Games, headed by detail-oriented businessman Peter Ueberroth, produced a budget surplus of $232.5 million on revenues of $768 million--a profit margin of 30%. Ueberroth is also a member of the 2012 committee.

Of the $232.5 million, 40%, about $93 million, went to the Amateur Athletic Foundation in Los Angeles. Over the last 16 years--with Argue, chairman of the L.A. 2012 bid committee, playing a leading role in overseeing investments--the foundation has given $100 million to youth sports programs.

The rest of the 1984 surplus, nearly $140 million, went to the USOC.

The working L.A. 2012 budget accounts for $2 billion in revenue. The USOC told each American candidate to assume $1.5 billion in TV and corporate sponsorship. L.A. 2012 figures tickets would bring in $503 million.

Expenses would total slightly more than $1.9 billion and include operating costs and payments related to venues and facilities.

L.A. 2012’s revenue projections, however, don’t include interest income, the traditionally successful Olympic coin programs or the licensing of the Games logo for clothing and other souvenirs.

Interest income generated $76 million for organizers in 1984, when interest rates were considerably higher than now. Ticket projections assume the sale of 80% of seats. At the recent Sydney Games, more than 90% of the tickets were sold.

“One of our messages is, we feel we have a sound financial plan,” Simon said.

Historically, the most prominent expense has been construction. With a few exceptions, everything in L.A. is ready to go. Construction costs for the shooting range, the replacement of the Coliseum track and other projects amount to “less than $100 million,” Simon said, or about 5% of the L.A. 2012 projected budget. All construction projects would be paid by private sources, not the local or state governments, according to the bid committee.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

The Next Olympics

SUMMER GAMES

2004--Athens

2008--To be awarded in 2001. Beijing, Paris and Toronto are the leading contenders.

2012--To be awarded in 2005.

WINTER GAMES

2002--Salt Late City

2006--Turin, Italy

2010--To be awarded in 2003. No U.S. candidate.