US city to receive $1.8bn in advanced funds for standing back until 2028
yesterday by: Murad Ahmed in London
Los Angeles has agreed to step aside for four years in its pursuit of staging the Olympics the world’s largest sporting event, handing Paris the 2024 games.
On Monday, the bid team for the US city announced it had reached an agreement with the International Olympic Committee, the games organisers, to host the 2028 games.
The move ends the long-running saga over which cities will hold the quadrennial spectacular into the next decade. The move was first reported by the Los Angeles Times.
Paris and Los Angeles were the remaining bidders for 2024, after other potential host cities for 2024 — including Budapest, Hamburg, Boston and Rome — withdrew citing cost concerns. Tokyo is due to hold the 2020 games.
Earlier this month, the IOC decided to hold an unprecedented double vote for the 33rd and 34th Olympiads to ensure two strong hosts at a time when few other countries were prepared to take on the cost of staging the event.
Both cities had lobbied hard to host the 2024 games, but Paris had consistently refused to countenance waiting any longer after losing out with a series of bids for past games.
French President Emmanuel Macron has been vocal in support the Paris bid, while the Los Angeles bid team said US President Donald Trump “has been personally involved to make LA’s bid a truly American bid”.
For both cities, it will be the third time they have held the summer games
For agreeing to wait, the IOC has agreed to advance funds to Los Angeles, based on the estimated value of sponsorship and marketing deals for the event.
The US city will receive at least $1.8bn “in view of the longer planning period and to increase participation and access to youth sports programs in the city of Los Angeles in the years leading up to the Games”. That figure that could rise to $2bn, depending on the value of future deals.
The IOC typically splits revenue from sponsorship and broadcast deals with a host city, but most of that money is not received until a couple of years before the start of the event. For Paris 2024, the figure is expected to be $1.7bn.
For agreeing to host the 2028 event, Los Angeles will be in line to receive up to $2bn in total. The IOC has agreed to hand over a $180m interest-free loan immediately, which is expected to cover the costs of the Los Angeles organising committee for an additional four years, as well as fund youth sports initiatives in the city. The IOC is also waiving its right to recoup any surplus from the event, should the US city bring in the games under budget.
“Today, we take a major step toward bringing the Games back to our city for the first time in a generation and begin a new chapter in Los Angeles’ timeless Olympic story,” said Los Angeles Mayor Eric Garcetti.
IOC president Thomas Bach said that the move would provide a “win-win-win” for LA, Paris and the Olympic movement.
The agreement will need to be ratified by IOC’s members at a scheduled meeting in Lima, Peru in September, but that session is expected provide the necessary rubber stamp.
Researchers at the Saïd Business School in Oxford analysed 30 summer and winter Olympiads last year. They said none of the events came in within their initial budgets and nearly half exceeded targets by more than 100 per cent.