Boston may have underestimated Olympic costs by more than $900 million, report says
A study of Boston’s failed bid for the 2024 Summer Olympics suggests that leadership underestimated potential venue costs by nearly $1 billion.
Massachusetts state legislators had originally commissioned the report to get a clearer view of risks involved with the bid. Before it could be completed, though, Boston officials dropped out of the running, citing widespread public opposition.
Still, a consulting firm called The Brattle Group published its findings on Tuesday, identifying the strengths and weaknesses of the erstwhile campaign.
While Boston 2024’s revenue projections were deemed reasonable, consultants found the $918-million estimated budget for venues should have been “over $970 million higher.”
A temporary main stadium, athlete’s village and media center were cited as locations particularly vulnerable to overruns.
Operating costs might have run $750 million more than anticipated, the study found.
“Even though the bid was withdrawn, this report demonstrates that there were a series of real risks associated with bringing the Games to Massachusetts,” state Senate President Stan Rosenberg said in a separate statement.
In the wake of Boston’s departure, Los Angeles has become the front-runner to bid for 2024, with U.S. Olympic Committee officials hoping to make a decision by the end of the month.
Mayor Eric Garcetti has projected a budget of $4.1 billion — with an additional $400-million contingency fund — to stage the Games. He believes the event could finish with a $150-million surplus.
While the city has nearly every required venue already in place, it would need to work with USC on renovating the Coliseum and partner with private developers to help pay for construction of the village and media center, whose combined price tag could exceed $1 billion.
The Brattle Group saw particular uncertainty in Boston’s prospects for securing more than $4 billion in such partnerships across a number of venues.
If Los Angeles ends up bidding, it would be asked to sign a contract promising to backstop the project with taxpayer dollars if costs ultimately exceed revenues.
The USOC must submit a candidate to the International Olympic Committee by mid-September. The IOC is scheduled to vote on a host in 2017.
Follow David Wharton on Twitter @LATimesWharton
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