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Cities Should Beware These Changes to the Olympic Bidding Process

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INTERNATIONAL OLYMPIC COMMITTEE
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To say that the International Olympic Committee (IOC) "shook things up" with Agenda 2020 -- as the Associated Press did on August 2, 2015 -- is a gross understatement. Agenda 2020 voided and obscured critical sections of the Olympic Charter and the Olympic Games Framework, the IOC's two main documents for how to bid for and host an Olympic Games. It didn't just shake things up. It changed the entire game plan.

How did this policy shift affect the Games? And who benefits most from this change? Those are the real questions here.

The IOC passed Agenda 2020 in December 2014 under immense pressure to woo potential hosts back into the Olympic fold. The Games had become too expensive, too risky, the benefits too lopsided, and the IOC's technical demands for hosting were too rigid. Worldwide resistance to the Games was mounting -- look at the present "No Olympics" campaigns in Boston, Los Angeles and Toronto -- making the IOC more than a little uncomfortable.

There are multiple sources of funding that pay for the Olympics, such as licensed products, ticket sales, broadcast rights, and governments. What is the common denominator behind each? Well, that would be the taxpayer.

First we pay to secure the rights to host and build the Games. Then we pay again if we want to attend the party. Then we pay for upkeep of these private facilities. Corporate sponsors kick in a little bit. Jules Boykoff, Associate Professor of Political Science at Pacific University, and author of Celebration Capitalism and the Olympic Games, estimated that 12 per cent of the $18 billion USD price tag for the London 2012 Games (using the Auditor General's report, which did not factor in several major infrastructure upgrades) came from corporate sponsors. That means the public paid for 88 per cent of those Games.

No wonder the IOC and National Olympic Committees are doing their best wooing -- they can't afford to lose their biggest funder of all -- you and me. Agenda 2020 promised more transparency, accountability, and affordable Games for all.

The document itself is an easy read. The 25-page downloadable file includes 40 recommendations, covering everything from the organization of the Games, to honouring clean athletes, to extending the age limit of IOC members. It's a real mishmash of things. However, the important thing for now concerns Recommendation one, the bidding process.

Recommendation one introduced a new "Invitation" phase, tacked on to the established "Applicant" and "Candidate" phase, providing for a three-year bidding process. Each phase had clearly marked schedules with milestones.

The Invitation phase was a preparatory phase, where interested cities could discuss and receive feedback from the IOC on their bid plans. It was also where interested cities could decide if they wanted to become an Applicant.

The IOC formalized its new three-stage process in the Olympic Charter, also released in December 2014, and expanded on the Charter's rules in its 2024 Olympic Games Framework, released six months later, in June 2015. The terms of the race were thus set.

Then came the July 2015 election of the host city for the 2022 Winter Olympic Games. It was a complete embarrassment for the IOC, with four of the six cities -- Oslo, Krakow, Lviv, and Stockholm -- pulling out, leaving only Beijing and Almaty, Kazakhstan, both with tragic human-rights records, laughing neck-and-neck down the homestretch. IOC voting was close, with Beijing ousting Almaty 44 to 40.

The IOC panicked.

Suddenly, on August 2, 2015, the IOC announced that it had tossed out the entire Applicant phase, funneling all interested cities directly from the Invitation phase into the Candidate phase. Normally, the Applicant phase is where bid teams determine the public's response to hosting, carry out feasibility studies, develop their business plans, and sign the IOC's Host City Contract (the "blank cheque"). The cost for this phase is usually around $1 million USD. But it was a competition. At end of the segment, the IOC would shortlist its preferred cities, narrowing the field down a select handful of Candidates.

With the Applicant phase gone, all cities that sign the commitment to bid on September 15th will likely be in the race to the very end -- September 2017, when the IOC elects the host. Weak and strong will compete for the IOC's attention, ensuring bids that should have been eliminated in the Applicant phase keep spending in the hopes of winning on political, rather than technical, grounds. The Candidature phase normally costs upwards of $50 million USD, depending on the type of planning and consultations that are required.

You can bet the IOC will curry favour with the covetous bid teams to ensure no city backs out. The IOC doesn't want Agenda 2020, hailed as "The Strategic Roadmap for the Future of the Olympic Movement," to be a failure. Christophe Dubi, IOC Executive Director, said eliminating the Applicant phase was a good thing because it assured the IOC a "flood" of Candidates in an era of dwindling interests. Of course there will be a flood of Candidates. The IOC engineered it that way. Does this sound like a marketing ploy or a genuine transformative exercise?

What is worse, the IOC's hasty decision to remove the Applicant phase nullified its own Charter and Framework. The rules and deadlines outlined in each of those critical documents are no longer valid. There are currently few signposts to help the public keep an accountability watch on the industry, and the industry isn't divulging what it knows. The IOC has not yet posted details of the new schedule, and September 15th is staring us in the face.

But why should industry members share this information? They benefit from their monopoly. Look what happens when the public has a say: they organize and revolt, as they probably should.

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