Economic Decline has Vanoc Scrambling

Economic downturn and headline-grabbing natural disasters leave Vanoc scrambling
Toronto Star, Jan 05, 2009
Petti fong
WESTERN CANADA BUREAU CHIEF

VANCOUVER–It will be a year of cutbacks for Vancouver Olympic organizers, months of testing and tweaking Olympic facilities and, above all, hoping that the economy stabilizes.

The Vancouver Organizing Committee, known as Vanoc, is heading into 2009 with optimism but an awareness that much has changed in the last six months.

Tickets sales have been as strong as expected and no major sponsors have pulled out, even though virtually all of the major corporations involved have had financial setbacks.
"We'd be naïve to assume they are immune," said Vanoc's chief financial officer John McLaughlin last month after organizers released the last financial report of 2008. "But so far we have had good success with them."

Organizers say they've had no indication that sponsors won't deliver on their commitments. One of the Games' most prominent sponsors is on the verge of bankruptcy. General Motors is supposed to provide nearly 5,000 vehicles for the Games, which begin in February 2010. Another sponsor, Nortel, is also in a shaky financial position.

According to the latest financial statements, Vanoc signed contracts for more than 90 per cent of the $760 million anticipated from its sponsors. About 40 per cent of that had been received by year's end in both cash and in-kind goods and services.

With Vanoc committed to finding ways to cut its budget and squeeze more money out of what it has, some community partners have already balked at the price of admission.
The Vancouver suburb Port Moody found itself unable to afford the $250,000 Vanoc wanted in order to be designated an official "partner" of the Games.

The municipality, a 20-minute drive from Vancouver, had hoped its new ice rink would be used as a practice facility for athletes.

Other municipalities, like West Vancouver, paid $1 million to be designated an official venue city for the Games, but only after private donors came up with the money.

Two final international sponsors won't be sought by organizers until the market stabilizes, but with a year to go, Vanoc is betting that the economic downturn won't continue. On the plus side, organizers are set to announce that a new sponsor has signed on and will be unveiled within weeks.

Organizers are focused on the immediate goals of trying out the facilities and sporting events. Cathy Priestner Allinger, the executive vice president of sport and Games operations, said the first three months of 2009 will be a testing time.

Sixteen world-class sporting events will be held in facilities to try them out, a challenge for organizers but also an opportunity for Vanoc to work out the bugs.
"You may hold one or two of these a year, they're quite large in scope," said Allinger. "In some cases, it will be the first time we'll be running some of the major events. It gives us the chance to get into the venues and tweak them and work with the ice and the snow."

Some of the major sporting events will be at the sliding centre and the Nordic centre in Whistler. Allinger said the most challenging aspect of the operational tests will be seeing how organizers handle the transportation requirements of bringing people back and forth from the facilities.

One of the most pressing issues remains the Sea-to-Sky highway, the main transportation link between Vancouver and Whistler. Last year, a major rockslide made it inaccessible for days.

Other incidents have called safety into question, including the recent avalanche deaths in Whistler, host of the Nordic events, and the collapse of a gondola in the resort community just before Christmas.

Allinger said because it's the Winter Olympics, everybody expects there will be weather challenges, and while the gondola accident was surprising, organizers knew it was the kind of accident that can happen at ski resorts.
"We try to think of everything that's possible," she said. "We want to make sure we're nimble and quick and able to respond to anything."

Vanoc is to release its next budget update on Jan. 21.