A source with direct knowledge of the local organizing committee for the Rio Olympics' finances said that the committee "is running a deficit" of between R$400M and R$500M ($121M-$151M), according to Rodrigo Viga Gaier of REUTERS.
The local committee's privately funded budget "is what is used to operate the Games; it is not public money which is used for infrastructure or venues." The deficit, "challenging organizers 25 days before the games begin," represents about 6% of the local committee's budget and just over 1% of the total projected cost of R$40B ($12B) to host the Olympics.
The source said that "the committee could not fill the gap" in its R$7.5B ($2.2B) budget "despite making as many cuts as possible." But a top Rio city official said that organizers "were still working to cut costs to avoid a committee deficit." According to the contract, any deficit after the Games "must be filled by the city, state and federal governments, which are already severely strained amid Brazil's worst recession since the 1930s." Rio 2016 spokesperson Phil Wilkinson "declined to comment on any deficit." He said, "We're on course to deliver a balanced budget for the Games." The source said that "the big drivers of the deficit are rent for the Olympic Village." The rent "was expected to be paid mostly by the federal government," with the local committee only paying 10% of the cost -- or about R$40M ($12M). But the source said that that agreement "was made with suspended President Dilma Rousseff." Amid her impeachment and the installment of an interim government, the money "has not yet materialized" (REUTERS, 7/11).
