Daley Backs 2016 With City Guarantee
By Kate Gardiner in News on Jun 18, 2009 5:40PM
When it all started, Mayor Daley said the taxpayers would bear no additional costs from his 2016 Olympic dream. We'd get the Games, development would be spurred on, and glory would come to Chicago. And the taxpayers would only reap benefits, from the redevelopment of Chicago's Michael Reese Hospital campus to revamped venues all over the city.
But what if it all goes to hell? What if there are overages, or inflation or ... Lake Michigan suddenly evaporates? Then we - the taxpayers and the city - are liable, thanks to Daley's agreement to sign a contract, made yesterday in Switzerland. The contract, which our beloved Mayor had refused to sign, fearing just this, was one of the major issues with the bid. All the other cities agreed to sign it, and Daley was left standing alone.
So he capitulated, and put the taxpayers at risk, though both he and 2016 spokesman Patrick Ryan said that this new risk was mostly hypothetical. According to the Tribune:
"In a worst-case situation, such as severe cost-overruns or a catastrophic event, the agreement could leave taxpayers on the hook for hundreds of millions of dollars or even more, a scenario Chicago's bid team acknowledges but insists is far-fetched...
Bid officials said they can offer the guarantee because they plan to add another insurance policy worth a minimum of $500 million to existing guarantees, which they think creates an ample buffer for taxpayers...
The contract requires the city and the Olympic organizing committee to assume unlimited financial liability for the "planning, organization and staging of the Games."
Daley told the Tribune today that there is very little risk, though, like all things with the Mayor, what he actually says doesn't make much sense. Example: "If everyone goes bankrupt in the world, I don't know what happens. The one thing I know is it is only $500 million to Chicago taxpayers." Ah. Only $500 million to taxpayers.
But Daley, who had insisted he would not sign the contract as it was written, did not consult the city council about his decision, eliciting surprise from city aldermen. Among those were Alds. Joe Moore (49th), and Manny Flores (1st). Moore told the Tribune, "We were told we were only on the hook for $500 million," said Ald. Joe Moore (49th). "The more you look at this, the more it looks like they should come back to us. ... Before you have the mayor of the city enter an agreement that would render us fully liable for a huge sum of money, we have an obligation to have it reviewed by the representatives closest to the people, and that's the members of the City Council."
Flores said in his press release, "I am deeply disappointed to learn that Mayor Daley and the Chicago 2016 Committee signed a pledge with the International Olympics Committee that could leave billions of dollars of cost overruns in the laps of Chicago tax payers. At the next City Council meeting, I plan to introduce an ordinance that will prohibit the use of any additional tax payer dollars to pay for the Olympics."
Flores remains in favor of the Olympics coming to Chicago. All the other cities vying for the 2016 Games had government guarantees. The 2016 Olympics are projected to cost $4.8 billion if held in Chicago.