Vancouver Faces Higher Borrowing Costs Due To Athletes Village
The City of Vancouver "faces higher borrowing costs after" Standard & Poor's decided the athletes village project for the '10 Vancouver Olympics has "tarnished the city's sterling credit rating," according to Justine Hunter of the GLOBE & MAIL. The city was "placed on credit watch after the disclosure of details concerning the financing" of the athletes village, and until the "funding uncertainty is resolved, the city's official credit rating will include a warning that it could drop." Standard & Poor's credit analyst Stephen Ogilvie in a bulletin yesterday wrote of Fortress Investment Group, which has stopped lending money toward the project, "While negotiations have been under way with the lender, it is not certain that it will resume lending. Standard & Poor's is concerned that, without the lender's financing, the city might have to step in and finance the project, including the potential of borrowing a significant amount of debt to complete the Olympic Village" (GLOBE & MAIL, 1/14). VANOC CEO John Furlong yesterday said that VANOC is "open to ideas on how the city could save money on the beleaguered Olympic athletes village project." But Furlong added that VANOC officials "aren't considering any cuts of their own." Furlong: "In our budget, the No. 1 priority is to protect the athletes' conditions for the games. That isn't to say we wouldn't work with the city to look at anything they come up with that's an idea" (CP, 1/13).
HISTORY REPEATING: A GLOBE & MAIL editorial states the '10 Vancouver Winter Games are "beginning to evoke comparisons to the disastrous" '76 Montreal Summer Games. Though there is "every reason to believe that the Vancouver Games themselves will go off without a hitch, and that the Olympic sites in Vancouver and Whistler will sparkle," there is "one obvious similarity: the cost overruns that have afflicted many Olympics, not just the ones held in this country." It is "unlikely that Vancouver will find itself still paying off its debt three decades later, as Montreal did," but "recent surges in expenses have made a mockery of the initial promise that the Games would require only [C$30M] in provincial and municipal funding" (GLOBE & MAIL, 1/14).
UNANIMOUS SUPPORT: In Chicago, Dan Mihalopoulos reports Chicago aldermen, "without a single word of debate," voted yesterday to "use new property tax revenue for Chicago's 2016 Olympics bid and guaranteed the city would cover additional police patrols, street cleaning and other services for the Summer Games." The measure also "commits the city to using an unspecified amount of tax-increment financing dollars to subsidize infrastructure improvements at the Near South Side site of what would be the Olympic Village" (CHICAGO TRIBUNE, 1/14).
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