Olympic Organizers Struggle with 2010 Budget

Head of Vancouver Olympics effort under pressure as advertising revenue falls short
By STEPHANIE LEVITZ The Canadian Press, Sat. Aug 8, 2009

When the weight of the 2010 Winter Olympics was placed on John Furlong’s shoulders five years ago, he said the measure of his organizing committee would be if it was able to bring the uncontrollable under control.

But the present fiscal situation the committee is facing is one Furlong never saw coming.

With six months to go until the Games, how Vancouver organizers bring this crisis under control may be the true legacy of these Olympics.

"No one had ever thought that we would be trying to deliver in this kind of environment," Furlong, the chief executive officer of the organizing committee, said in an interview with The Canadian Press.

"To be able to achieve a great outcome against this might turn out to be one of the great legacies of the Games and it may be a very profound reference point for the spirit of Canadians."

Furlong’s enthusiasm for the Games remains undiminished, even after exhaustion forced him to spend last Christmas in bed and Father’s Day with his daughter this year was a quick breakfast and a gift of pyjamas. He barely sleeps enough to wear them.

He still finds wonder in meeting Air Canada flight attendants who show off their official Olympic scarves or in the collectors who ask him to sign their first-day issues of Games stamps.

A self-described introvert, the semi-celebrity status conferred upon Furlong adds to the pressure of the enormous challenge ahead: figure out a way to put on the Games that were promised without spending one cent more than their $1.75 billion budget.

The organizing committee is facing a revenue shortfall that could be as much as $42 million – a$30-million missing payment from the International Olympic Committee and $12 million in unsold outdoor advertising space.

Pricey VIP packages aren’t selling and the post-Games plan to sell off assets is now not expected to make as much money as before.

They’ve already said they expect to use every penny of the $27 million revenue contingency fund they set up in January.

That’s before these Games even get off the ground.

"Nobody is going to give the organizing committee a get-out-of-jail card because it’s tough," Furlong said.

"We’re still expected to rise to the occasion. That’s what we have to do, that’s what our team believes they have to do and that’s what they’re trying to do."

It’s meant some creative choices.

Rather than hire 1,200 temporary employees, the organizing committee is trying to get employers to loan workers.

Rather than pay for the uniforms that young people will wear to drape medals over athletes necks, they got a company to provide them.

"We will look at everything we have to do between now and Games time," said Furlong.

"Whether it’s printing a book, shooting a piece of video, anything at all that we’re doing, if we think we can find a friend to help us deliver it, to take the burden away, to make a contribution to the Games to do something for the country, we’ll be looking to do that."

It’s also meant changing the way they work. Furlong now has a deputy CEO, Dave Cobb, to help speed up the approval process for decision-making.

Organizers rely more on their partners to host community events to rally Games spirit, rather than spending the cash themselves.

They cut back on travel for executives, have asked the federal government to help out on things like translation services and have scaled back transportation plans for Games-time.

But those are all small dents. While Furlong likens the creative cost-saving plans to having companies remove pieces from a chess board, the clocking is ticking down to a checkmate.

Organizers start taking over some elements of the venues in September.

The torch will be lit Oct. 22 in Greece.

In the early days of the recession, organizers and the International Olympic Committee talked about rejigging plans to slice away the nice-to-haves from the must-haves. An upcoming visit by the IOC will likely revolve on what "must have" really means.

As one Vancouver organizing committee staffer put it recently, they are living in damage-control mode.

While the lessons of how to throw one of the world’s biggest events in the middle of a recession might be one legacy of the Games, what actually happens six months from now will be the story, Furlong said.

"The country will look at the month of January and February of next year and that in many ways will be what the country takes from this," he said.

"The story of how we got there will be important but the feelings and the energy and the emotions that are generated by the Games, we’re not there yet."