Olympics Feasibility Study Shows Costs and Revenues Involved

SEATTLE — Discovery Institute today released a lengthy study on the feasibility of Washington state hosting the Summer Olympic games claiming that, “The economic analysis indicates that, based on information available to this point, hosting the Games would cost somewhat under $1.7 billion, … with revenue exceeding costs by approximately $60.”.

“This study shows that Washington, and Seattle in particular, is in an excellent position to host the Summer Olympics in 2012,” feasibility study coordinator, Stephanie Bowman said. “However, the study is not the final word on whether Washington should host the games. Ultimately, that’s up to the people of Washington.”

The year and a half study determined that Seattle is in an advantageous position due to its new sports facilities, superior summer climate, and experience in hosting large, international events (such as the 1990 Goodwill Games). The study covers in-depth: sporting venues, accommodations for spectators and participants, transportation, economic impact, security, technology and telecommunications, environmental impact, and the Olympic Village.

Copies of five page executive summary of the study are available from Discovery Institute. The complete study is also available and can be ordered by calling Stephanie Bowman of Discovery Institute at (206) 292-0401 ext. 125.

Discovery Institute is a non-profit, non-partisan, public policy think tank headquartered in Seattle and dealing with national and international affairs. Discovery is dedicated to exploring and promoting public policies that advance representative democracy, free enterprise and individual liberty.

Introduction

A committee was formed in late 1994 to explore the potential of Seattle and Vancouver, British Columbia co-hosting the Summer Olympic Games. The initial concept was to spread the events of the Games between the two cities, and possibly as far south as Portland, Oregon ñ- a geographic area referred to as “Cascadia.” This idea of a bi-national Games was unique and seemed to embody the spirit of the Olympics: two nations coming together in the spirit of competition, peace and cooperation in hosting the people of the world.

In 1995 the Washington State Legislature appropriated funds for the Department of Community, Trade and Economic Development to commission a study determining the feasibility of hosting the Summer Olympic Games in the years 2004 or 2008, “in the region including Washington, Oregon and British Columbia.” King County, the City of Seattle and the Sports and Events Council of Seattle / King County also appropriated funding to complete this research.

One of the first issues examined was whether a bi-national Olympics would be allowed. It was discovered that the International Olympic Committee currently prohibits multi-national Games, except where unavoidable during the Winter Games (e.g., ski slopes crossing national borders). Soon after, the United States Olympic Committee (USOC) decided not to support a candidate city for the 2004 Summer Olympics, as Salt lake City had just been awarded the Winter Games of 2002. In late May of this year, the USOC again announced that, although there was unprecedented interest within the U.S. in bidding on the 2008 Summer Games, they would not be submitting a candidate city for that Olympiad. Therefore, 2012 is the earliest potential year the Summer Olympics would be held in the United States.

As the above information came to light, the scope of this study adjusted accordingly. Had we adhered to the original scope of work, this study would be limited to a paragraph in length (ëIt is not feasible to host a bi-national Games because the IOC prohibits it, and because the USOC has decided against submitting a candidate city for 2004 or 2008í). However, adjustments were made, as was every reasonable attempt to include the most up-to-date information, including delaying release of the study to account for the results of the football stadium vote in June, 1997. Had the study been completed before the football and baseball stadium votes occurred, itís outcome would have varied significantly. Nevertheless, it is expected that portions of this study will require updating ñ for instance, hotel capacity in King County will continue to increase, as Seattle is experiencing the largest hotel building surge since the Worldís Fair in 1962. Therefore, this feasibility study should be regarded as an evolving document: it is a starting point for examining the current requirements and resources for hosting the Summer Olympics, recognizing that appropriate changes will be needed as time passes.

This feasibility study is not, nor is it intended to be, the final word on whether Seattle should host the Olympics. Research conducted for this study has determined Seattle does have the capability to host the Olympics, and that doing so would provide many benefits to the city, the state and the region. The final decision on whether to pursue the Games, however, ultimately belongs to the citizens of Seattle and the state of Washington. Seattle has a long history of decision-making by referendum. For an event as large as the Olympics, it is assumed there would be strong citizen participation.

The Summer Olympics is the largest single event in the world. It attracts more spectators, has more participants, and generates more income than any other. It has the potential to alter a region: serving as a catalyst, it has brought about construction of needed housing, improvements in transportation and infrastructure, and the development of world-class sporting venues to its host cities. Yet so much of the Olympics ñ the synergy, goodwill and coming together of cultures from around the world ñ are intangible benefits not quantifiable in after-action reports, or for that matter, feasibility studies.

However, the Olympics are not a panacea for social and economic ills. While the Games bring many benefits, it also requires tremendous expenditures of resources, both financial and time, by a cityís populace. These resources, some argue, would be better spent in other ways.

Surveys show that many citizens worry about the potential unhappy consequences of the Olympics, though they generally associate the negative impacts with short-term problems such as traffic jams during the two weeks of the Olympics. Research indicates that that these impacts can be limited with good planning, and further, that planning for the Olympics can become a way of developing a schedule for dealing with various community problems ñ such as transportation ñ that otherwise might not be addressed until they become a crisis. The Olympics, therefore, could become a specific goal that helps the Puget Sound region think ahead and take specific steps to improve its communities holistically. We know this from the experience of most other cities which have hosted the Olympics, as well as Seattleís own experience in hosting such events as the Alaska Yukon Pacific Exposition and the Century 21 Worldís Fair. Roughly fifty years separate those two previous seminal civic events (1911 and 1962). Fifty years from the Worldís fair will be the Summer Olympics of 2012.

Even if Seattle were to bid unsuccessfully for the Olympics, the effort would not be wasted. Current projects and resources identified in the course of researching this study (e.g., developing a rowing / kayaking venue at Lake Kapowsin) are valuable for numerous world-class sporting events, and certainly scores of recreational uses.

The merit of this study mirrors that of planning to host an Olympics: it assesses the resources of a city and region while creating a vision of what it can become. The spirit of the Olympics is exemplified in the value of the bidding process. The seven year bidding process for the Olympics has been instrumental in making cities think about their goals for infrastructure, trade and growth. These seven years of planning are celebrated by two weeks of sports and arts. Whether or not a city wins, bidding on the Olympics is a valuable exercise in and of itself.

Seattle can, and should, bid to host the Summer Olympics.

Executive Summary

Seattle is in an excellent position to become the host city for the 2012 Summer Olympic Games. Whether it should want to host the Olympics is another matter. This study concludes that the opportunity is well worth pursuing, so long as financial supporters, state and local leaders and ordinary citizens recognize that holding an Olympics will not solve entrenched community problems, nor is it the harbinger of assured prosperity and progress. The Olympics will not guarantee an economic bonanza for the Puget Sound, nor should it be sold as such. But it is fair to say that hosting the Olympics is financially and logistically feasible, and is likely to leave an impressive physical legacy and strengthened civic institutions of cooperation.

Because of the long lead time (two years from now before the selection of a U.S. bid city, seven years before selection of the host city, and nearly 15 years before the actual Games), the prospect of hosting the Olympics would provide an opportunity to focus long range thinking on the regionís future. Just as the Alaska-Yukon-Pacific Exposition of 1911 left the University of Washington campus as its monument and the Worldís Fair of 1962 resulted in the Seattle Center, the Seattle Olympics of 2012 could leave residents of Puget Sound a permanent Olympic Village within what is now an industrial or environmentally degenerated area.

To assure success with an Olympics bid, it would behoove the Seattle community to cooperate extensively with other jurisdictions in the broader region (including even Oregon and British Columbia, where possible) to emphasize the role of private business and philanthropic sectors, and to maximize existing assets.

Good examples of what already will be “existing assets” by 2012 are the two new stadiums already nearing construction and Regional Transit Authority improvements approved by the voters in 1996. The question of whether it is “feasible” for the Puget Sound region to host the Summer Olympics would be answered much differently without these recent developments. Together, as a collateral benefit, they represent a substantial public sector investment that increases the chance of hosting the Games while significantly reducing the future cost. Further improvements — in transportation and housing, for example — are also of the kind that will be needed anyhow as Seattle approaches 2012. Indeed, one of the strongest reasons for bidding to host an Olympic Games 15 years from now is the positive opportunity it provides to focus attention on issues of Seattleís future.

The Bidding Process

A U.S. city is in a strong position to host the 2012 Summer Olympic Games. The importance of the domestic U.S. television market and trends in broadcasting and corporate sponsorships agreements make a U.S. bid both economically feasible and appealing to the International Olympic Committee. Eight U.S. cities have expressed to the United States Olympic Committee (USOC) an interest in bidding to host the Summer Olympics. In 2000 the USOC will select one city as its “candidate city” for the 2012 Games. Seattle, with its new sports facilities, superior summer climate and experience in hosting international events (such as the 1990 Goodwill Games), is in an advantageous position.

Sporting Venues

Seattle and the region already have the majority of venues necessary to host the Summer Olympics. There are 15 likely venues in place or planned for construction by 2001, and an additional five venues that should be acceptable with development or upgrading. The new football stadium and exhibition hall provides a potential venue for several sports, while the Tacoma Dome can accommodate those sports that would otherwise have been played in the Kingdome. In addition, there is a plethora of potential practice venues both within the Puget Sound and Eastern Washington, such as the West Seattle Stadium, Nordstrom Tennis Center and the Yakima Sun Dome. Oregon and British Columbia also have several exceptional facilities, and their use should be explored with the IOC and International Federations of Olympic sports.

Of the five venues we believe would need to be constructed in order to host an Olympic Games, the three most costly would be the aquatics center, tennis and equestrian facilities. Two equestrian centers are currently planned by private developers and may well be completed by 2001. No site has been determined for constructing a tennis facility; however, several new areas of residential development should be explored, and construction of a world-class tennis facility would attract several international tennis events to the area. A new aquatics center is the most challenging venue issue. It would satisfy the need for a community or collegiate use pool, but the long-term operational costs should be addressed in the design process. The remaining three needed venues (archery, rowing, and shooting) could be constructed at minimal cost. Rowing is a popular Northwest sport and developing an Olympic-caliber rowing course will also provide local residents with opportunities for kayaking, canoeing and recreational swimming.

Partnerships should be developed with local communities and corporate sponsors to construct and maintain new facilities. The long-term use and operational costs of new or renovated facilities should be a top priority. Building venues to international specifications will be valuable only if additional features (such as seating) are also available to attract national and international competitions.

Accommodations for Olympic Spectators and Guests

There are already 28,000 hotel rooms within thirty-five miles of downtown Seattle, with an estimated additional 1,400 planned for completion in the near future. In comparison to recent Summer Olympics, this may be slightly less (five to ten thousand) than is optimal; however, the Puget Sound is currently experiencing a strong surge in hotel construction. Seattle (and Tacoma) could potentially increase accommodations capacity through the use of cruise ships, as was done in Barcelona and is planned for Sydney.

Additionally, planners should take advantage of rooms within the larger region. With expanded transportation options, a Seattle-based Olympics could draw on rooms from Eastern Washington, Portland and Vancouver B.C., increasing accommodation capacity by up to 20,000. Likewise, many visitors who come to Seattle are likely to extend their travel to other parts of the region, thus assisting the international tourism exposure of these areas.

Other accommodations options include university housing, which could provide economical lodging for up to 10,000, as well as Homestay / Homehost programs which could provide affordable accommodations while developing cultural exchanges.

Finally, the travel industry itself should be enlisted to insure pricing is controlled so that a Seattle Olympics reflects well not only on the community, but on the hospitality industry.

Transportation

The 1996 passage of the regional transportation plan establishes the framework and initial investment in our regionís transportation future. The Regional Transit Authorityís (RTA) ten-year plan, “Sound Move”, will more effectively link major sports venues in the Everett-Bellevue-Tacoma corridor with the airport and potential Olympic activity centers in the city of Seattle.

While hosting the Olympics in Seattle would require additional investment in our regional transportation system, these changes are needed anyway in light of the Seattle area growth. Implementing and increasing investments in state and regional transportation plans, and soliciting early citizen involvement in the planning process will help ensure the success of the Games and prevent Olympic-related gridlock. A potential Phase II of the regional transit plan could enhance downtown circulation between the Seattle Center, expanded Convention Center, new sports / exhibition facilities at the current Kingdome site, and the waterfront corridor. Enhanced rail and transit access to the University of Washington on the SR 520 corridor also needs to be explored.

Our regionís gateway position between Asia and Europe and expanded airport capacity provide excellent air links to the world and within the region. Our unique geography between the mountains and the seas restricts expanded highway capacity but provides alternative regional access options, such as marine transport. Enhancements to existing Amtrak service and additional ferry capacity will be necessary for spectator access to downtown Seattle.

Infrastructure investments alone cannot handle all the transportation challenges associated with the Olympic Games. Citizens need to be involved early in the development of Olympic transportation plans in order to mitigate impacts on neighborhoods. Expanding current successful alternatives, such as car / van pooling and flexible work schedules, will be necessary.

The 1996 Games in Atlanta displayed the increasing complexity of Olympic transportation systems for athletes, Olympic Family members, media and spectators, and underscored the need for better coordination between public transportation officials and the Local Organizing Committee.

Economic Impact

The economic analysis indicates that, based on the information available at this point, hosting the Games would cost somewhat under $1.7 billion, and would bring in revenue of over $1.7 billion, with revenue exceeding costs by approximately $60 million. Seattle need not, and should not, imitate Atlanta, which aimed (and succeeded) in having the largest Olympics ever in terms of attendance. While ticket sales in Atlanta totaled 9.5 million, preliminary analysis reveals Seattle is likely to sell roughly two-thirds that amount, or 6.7 million tickets.

While the Games would not create an economic bonanza, research indicates it would be a profitable event with modest financial surplus. Broadcast rights and sponsorships, which are the largest sources of revenue, have been increasing every Olympiad and are anticipated to be stable for the 2012 Games. About two-thirds of costs are associated with operating the Olympics, with about one-third required to develop housing and sports venues.

In terms of secondary effects, the Games are estimated to generate over $5.7 billion in total sales for Washington, not counting travel and purchases of Washington residents. These sales will be associated with $1.7 billion in payroll and support 68,000 jobs. In addition there will be a number of tangible benefits, including new and improved sports facilities and housing stock, and such intangible benefits as improved business development opportunities and enhanced community pride.

Olympic Village

The challenge to develop housing for Olympic participants may be the most significant issue facing a Seattle bid. However, with this challenge comes an opportunity to plan for the regionís growth. Possible options in developing an Olympic Village are: to renovate or expand existing housing, such as at universities or low-income housing areas; create a temporary village, or construct new housing that could add to the regionís stock, particularly in the areas of affordable and low-income. If desired, creating new housing, especially in a currently industrial or environmentally degenerated area, would leave a legacy for generations of residents, as was done in Seoul, Barcelona and Sydney. The latter is our preferred recommendation.

Security

There is no way any city can hermetically seal itself from a terrorist threat ñ before, during or after an Olympics. Further, in the dense media coverage of an Olympics, it is sure that any violence will attract more attention than it would at other times.

Nonetheless, security necessarily should be a high priority concern for Olympic planners. To promote safety of all kinds, law enforcement at all levels, community agencies and the Organizing Committee should consult early in the planning process to help ensure the Olympics security– from venues to public spaces ñ are sufficient to protect spectators and participants, while allowing ease of movement. Our recommendations include installing checkpoints at all major activity centers (not just sports venues), dispersion of crowds and controlling the size of the Games.

Fortunately, inasmuch as hosting an Olympics is a national concern, city, county and state law enforcement departments do not have to rely solely upon their own resources. To date the security personnel provided by the many federal agencies during Olympic Games in the United States has been without intra-governmental compensation, evidence of the priority of this issue.

Technology and Telecommunications

The extent and role of technology and telecommunications is changing so fast that its role at an Olympics in 2012 is nearly impossible to predict. However, one can assume that integrated networks delivering data, voice and video ñ whether through ground-based fiber optic, digital wireless or LEO-satellite broadcasting ñ will deliver the Olympic Games to more people on Earth than ever before. Seattle has over 2,800 miles of fiber optic facilities right now, and the Goodwill Games provided valuable event organizing experience to local companies.

Environmental Concerns

An Olympic Games has the potential to significantly affect the Puget Sound regionís natural, social and built environments ñ but for the better as well as the worse. While Olympics-related activities obviously could cause negative environmental impacts (for example, with litter, noise and crowding), they also offer opportunities to enhance the regionís environmental amenities (with upgraded parks maintenance, clean-up and beautification projects).

In order to mitigate potential adverse environmental impacts of a Summer Olympics in Seattle, and to capture the potential environmental benefits and opportunities, it is recommended that environmental planning and implementation take the form of a comprehensive environmental management system (EMS). An EMS would serve both as the overall environmental blueprint for the Games and as a management tool for the Organizing Committee and for participants in all aspects of the Gamesí operations.

Other Programs

The Cultural Olympiad and Paralympics are additional program requirements mandated by the International Olympic Committee. Seattle should welcome these requirements. Hosting the Paralympics could provide much-needed support and program development for disabled athletes. The region could undoubtedly host an excellent Cultural Olympiad, drawing on new arts facilities and the local experience of the Goodwill Games Arts Festival.

Conclusion

The facilities and infrastructure required to host the Summer Olympics exist or are currently planned for development in Seattle and the Puget Sound region within the next ten years. This was not the case two years ago. Passage of funding for a regional transportation plan and two new, world-class sports venues have altered the course of the Puget Sound, and as result have set the stage for hosting an event like the Summer Olympics. While no one can truly predict what such an event will do to a region, this study concludes that, given the resources available, Seattle could host a financially viable Summer Olympics while realizing a variety of modest legacies, dependent upon civic priorities.

Public and private leaders, and the general citizenry of the Puget Sound need to be involved in deciding whether, and how, the area should bid to host the 2012 Summer Olympic Games. Should Seattle decide to put forth a bid, local organizers should stress quality, not size of attendance. Properly approached, Seattle can manage the budget for this event and potentially turn a modest profit best used ñ as in Los Angeles ñ to endow youth sports activities. The Games could attract some federal funding, but planning should stress private efforts.

Indeed, it is important for any Olympics bid by Seattle to go forward with open eyes as well as inspired vision. Holding the Olympics is not a cure poverty, over-crowding, poor design or other major urban maladies. It is not a panacea, and selling it as such will lead to disappointment and disillusionment.

On the other hand, jaundiced skepticism is also not warranted. Should Seattle be selected to host the 2012 Summer Games, the attendant inconveniences will not be significantly greater than, say, the 1962 Worldís Fair. The positive legacies however ñ particularly in terms of new housing and improved transportation ñ could be far greater.

The Worldís Fair did not solve Seattleís difficulties of the time. But the event was good for the city, the region and the state of Washington, resulting in a legacy of the Seattle Center, enormous civic pride and increased prestige for the area. While fifty years separate the Worldís Fair and the Summer Olympics of 2012, a bid for those Games stands a similar realistic and practical goal.