With the International Olympic Committee judging the Los Angeles and Paris bids as equal, Los Angeles could again make hundreds of millions of dollars by hosting the either the 2024 or 2028 Olympic Summer Games.
IOC Vice President John Coates told NBC, which agreed to pay $7.75 billion for the exclusive broadcast rights from 2022 through 2032: “One of them would put their hand up for 2028 and that same city would vacate 2024.”
The only other time that a pair of host cities was named at the same time was 96 years ago, when Paris was awarded the 1924 Olympics and Amsterdam was awarded the 1928 Summer Games.
Winning the bid to host an Olympics had become a booby prize, because almost every city that won the right to host an Olympic Summer Games over the last 40 years has suffered crippling multi-billion-dollar financial losses. That explains why Budapest, Hamburg, Boston and Rome chose to drop out of the competition for the 2024 Games.
The 1976 Montreal Summer Olympics was predicted to cost to just $125 million. When challenged on the cost, Mayor Jean Drapeau — famously confident in his management capabilities — declared: “The Olympics can no more have a deficit than a man can have a baby.” The epic economic flop left Montreal saddled with $1.5 billion in debt.
After the cost to host the 2004 Athens Summer Olympics doubled to over $11 billion, Greece suffered a public debt crisis and is still an economic basket-case 13 years later.
The 2016 Rio De Janeiro Olympic Summer Games was tainted by corruption and cost Brazil $4.6 billion to host. Ten days after final ceremonies, Brazil’s Senate convicted impeached President Dilma Rousseff by a vote of 61-20 for illegally using state bank money to bankroll crony Olympic public spending and other boondoggles.
But a study by Beacon Economics LLC and University of California Riverside predicted that the Los Angeles area would see an $9.5 billion economic boost and generate $4.4 billion in worker earnings if the city were awarded the 2024 Summer Olympics.
The Los Angeles bid for the 2024 Summer Games was unique, because the L.A. 2024 Olympic Bid Committee (LA2024) claims it does not need to build any new permanent venues. Just like L.A.’s 1984 Summer Games, which made a $232.5 million profit, LA2024 will rely on existing sports venues in Los Angeles, Orange and Riverside counties.
But according to UC Riverside’s School of Business Center for Economic Forecasting and Development, the LA2024 final proposal will generate additional tax revenues of between $152 million and $167 million for the city of Los Angeles, mostly from hotel transient occupancy taxes and incremental sales tax revenues. The Olympics will increase local economic output by the equivalent of 74,308 to 79,307 full-time jobs.
The City of Los Angeles will still be at risk for the $6 billion in spending necessary to host the games. But L.A. 2024 estimates it will make hundreds of millions of dollars in surplus by selling $1.3 to $1.5 billion of Olympics and Paralympic Games tickets, plus booking at least $4.8 billion in advertising and sponsorship revenue.
The IOC’s Executive Board will meet on September 13 to ratify the final recommendation to choose which city will host the 2024 Games and which will host the 2028 Games.