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The Pan Am Games Have Been an Exercise in Gross Public Overspending

07/17/2015 05:05 EDT | Updated 07/17/2016 05:59 EDT
Sean_Marshall/Flickr
July 10, 2015

If a group constructing a massive project for you set a budget of $1.4-billion, but later came back and said they were spending $2.5-billion, what would you do? Normally you would probably throw the whole team out the door, and perhaps sue them for the $1.1-billion overrun.

But in this case, the $1.1-billion overrun belongs to former Premier David Peterson's Pan Am Games organizing committee, and even though two officers were fired, expenses continue to climb.

By the time they're finished, I'll bet it will cost $3 billion -- well over double the amount we were told in the beginning we would be paying.

But considering that the Games are a big hit with influential folks in Toronto, there's not nearly as much criticism of the atrocious waste of money as there would be if, say, Toronto Community Housing was found to have greatly overspent.

Moreover, it seems that the proud folks of our "world class city" don't want to blemish the image of the Games, which are running in Toronto and across Southwestern Ontario from July 7 to 26, followed by the ParaPan Am Games, August 7 to 15.

Games' advocates point to all of the shiny facilities communities will inherit and, while many of them are very beneficial, in some cases, it appears we are not getting our money's worth.

Officials are proud of the Athletes' Village, a huge complex built on old scrubland near the Toronto waterfront. After the athletes leave, the buildings will become townhouses, condos and student housing for George Brown College. This sounds fine until we learn that the price tag just for construction of a bare-bones structure with no furnishings is at least $709-million.

Athletes' Village gets an extra $1.4-million

And, at the last minute, Pan Am Games organizers spent $1.4 million upgrading the rough cement floors in the athletes village "to preserve the event's international image."

There are 2,200 units in the complex. Hmmm... over $700-million for housing. Just imagine how much housing the co-op folks could build if given this amount.

The biggest shocker is the construction of the Hamilton Pan Am Stadium, which is coming in at least $145-million for the 24,000-seat structure. Break it down and this comes to $6,041 per seat. Construction was finished two years late.

Travel expenses have certainly been abused. The Star says that critics claim up to $800,000 was spent on flying TO2015 and Pan American Sports Organization (PASO) officials to far-flung destinations where they were wined and dined.

The weird would-be porcupine mascot, Pachi, had cost us $383,045 as of last November and I can imagine expenses growing by another $75,000 or more.

Lots of "perks" on the side

And, for whatever reason, there are lots of small perks, such as $8,220 for Toronto Argonauts tickets, $9,820 in Tim Hortons gift cards, yoga pants and jackets. That's not all. There is a wine tour, flowers, parking tickets, dozens of catered meals and snacks, educational courses and professional dues for staff.

Now here's a good one: No one can say within millions of dollars what security for the PanAms will end up costing. It's unclear what the bill from the Ontario Provincial Police will be, and private security costs are now estimated at $81-million, double the amount budgeted just two years ago.

The obscenity of the degree of exploitation of the public dollar is understood when we learn that the fired CEO, Ian Troop, who was paid $477,000 a year, billed taxpayers 91 cents for parking and $1.89 for a cup of tea.

As a final slap in the face, we learn that the business community -- the sector making profits from all of this -- did not come through as expected. Last fall, the Ontario government had to put an additional $74 million into the Games, most of it because of lower than expected sponsorship revenues.

Had the public known that the original budget for the Games would double, perhaps they would have protested so much we would not have had the games. Officials claim that the first budget was not submitted low on purpose, but the budget was such a mess we really need to question their claim.

Interestingly, Torontonians will moan and groan if a Councillor spends, say, $5,000 on a trip or goes over their office budget a little, but people have no comprehension of the waste involved when we get into spending $2.5-billion.

Even though the Games are glossy and exciting, they should be evaluated in terms of the real needs of the city. A report released late last year says Toronto has the highest rate of child poverty in the country, a situation its authors call "the hidden epidemic." The report says almost 30 per cent of children in the city are from low-income families, a situation that leaves them less likely to graduate from high school and more likely to be sick.

How big is $3 billion, the amount likely to be spent on the Games? Well, the entire budget of the city of Toronto, with its 2.615-million people, is $11.5-billion for an entire year. Are here are some categories that desperately need extra funding: Children services receives $424-million. The entire budget to run public transit, one of the largest items desperately in need of more funding, is now $1.8-billion. The budget for under-funded public health is $251-million.

Benefits mainly to elites

Giant sports events, whether the limited Canada Summer Games all the way up to the Olympics are exercises in gross public overspending while the benefits go mainly to an elite segment of the population.

Sure, we love the glitter of the Opening Ceremonies, perhaps 125 Canadians will win shiny medals, and there will be both sports and social legacies -- but billions of dollars should not come out of the public purse for "circuses" when Ontario faces so many serious issues.

We should begin to worry that Toronto's elite is now talking about a possible bid for the Olympics. If the idea of a bid gets off the ground, we need some new rules. First of all, participating countries should share some of the costs. When fundraising begins, hotels, restaurants, and special event locations, etc. should be expected to contribute financially. After all, they're raking in billions while we pay a lot of the costs.

And finally, let's make members of the organizing committee personally legally responsible for sticking to the first budget they submit if the Olympics become a possibility. Surely they're familiar with this business concept.

This article first appeared on rabble.ca

You can read more of Nick's Posts at: A Different Point of View

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