The 1984 Olympic Games in Los Angeles are still paying off.
As American athletes arrive in Rio de Janeiro this week to compete in the 2016 Summer Olympics, their training and development is being funded, in part, by the 1984 event in Los Angeles. Yet the impact may be even greater at home, where athletic programs funded by the surplus generated 32 years ago have paid for athletic programs used by millions of children.
The 1984 games generated more than $200 million in profit, according to the L.A. organizing committee, and are often regarded as one of the most profitable Olympic Games of all time. That money was then split 60-40 between the U.S. Olympic Committee, which supports and sends American athletes to international games, and an L.A. nonprofit designed to promote youth sports in the area.
“It was run like a business, with strict budgeting,” said Peter Ueberroth, who served as president of the Los Angeles Olympic Organizing Committee for the 1984 games and was largely credited for its financial success. Ueberroth highlighted the work of volunteers and “some luck” for the achievement.
“We had over 25,000 volunteers – they were key,” said Ueberroth, who was named Time magazine’s Man of the Year in 1984 and went on to serve as commissioner of Major League Baseball.
The Los Angeles Olympic Organizing Committee gave $111 million of the profit to the U.S. Olympic Committee according to the terms of a previous agreement, and the U.S. Olympic Endowment was created to administer the funds, which have grown significantly since. The endowment had given out $262 million in grants as of 2012, according to the U.S. Olympic Committee website.
“The L.A. games in 1984 have had an incredible impact on the financial stability of the Olympic Movement in the United States, and the U.S. Olympic Endowment continues to contribute millions of dollars each year to support Team USA athletes,” said Patrick Sandusky, a spokesman for the U.S. Olympic Committee.
A sizeable chunk of the ’84 surplus – $93 million – was used to fund a youth sports organization called the Amateur Athletic Foundation of Los Angeles, now known as the LA84 Foundation. That pool was invested in the market, earning enough over the past 30 years to finance $225 million in grants used for the training of 75,000 coaches, infrastructure construction, and other projects such as structured sports programs in L.A. Unified School District’s 94 middle schools, including the Run4Fun and summer aquatics initiatives. The endowment has grown to $150 million since 1984.
“The (organization’s founders) invested significant resources back into the community while growing the endowment for perpetuity,” said Renata Simril, the group’s chief executive. “The work we do funds programs which give kids opportunities they wouldn’t otherwise have.”
The organization’s grants have served 3 million children, with a focus on those in high poverty areas. Recipients include the Southern California Tennis Association National Junior Tennis League, which supported the early development of tennis stars Venus and Serena Williams, according to Simril. “Our theory is that teaching, learning and competing in sports is a positive way to engage youth and develop their skills on and off the field,” said Simril, who served as a deputy mayor for economic development under Mayor James Hahn before moving to the Dodgers as senior vice president of external affairs. She was senior vice president and chief of staff to then-L.A. Times publisher Austin Beutner before moving to LA84.
After the 1976 Summer Olympics in Montreal left that city with more than $1 billion in debt (which it only finished paying off in 2006), Los Angeles was the only city to step forward and offer to host the 1984 games.
Although Mayor Tom Bradley was supportive, Angelenos voted overwhelmingly to reject any government financing of the event. So the mayor gathered a group of local business leaders and formed the organizing committee, which was tasked with figuring out how to pay for the games.
“A group of private citizens … said, ‘We’ll take on the obligation of hosting the games. The city will participate but isn’t going to help in any way, so we have to do it in a cost-efficient manner,’” said Gene Sykes, chief executive of LA 2024, the group leading L.A.’s bid to host the Olympics in 2024.
The group’s expertise in the entertainment industry wound up paying off. David Wolper, who produced the original “Roots” miniseries and “Willy Wonka & the Chocolate Factory,” sat on the committee. It was Wolper’s idea to sell television rights to the games, according to Ueberroth. The group negotiated a $225 million TV deal with ABC long before the games started.
The committee also increased revenue by limiting the number of corporate sponsors in order to charge higher amounts for exclusive advertising rights. It managed to cut costs by using as many existing buildings as possible. The only venues that had to be constructed from scratch were a velodrome in Carson and an aquatic center at USC.
The budget drafted by Ueberroth also planned for many contingencies, such as $1 million that could be spent to call in the National Guard during an emergency. When that money wasn’t spent, it was put back into the pot.
The success of the 1984 Olympics provided a blueprint for those preparing the 2024 bid.
“We’re blessed by virtue of the fact that ’84 was so good,” said Sykes. “The memories of the people who were here are universally positive.”
Once again, local executives, including Sykes and Chairman Casey Wasserman, have come together to spearhead a proposal that will be entirely privately funded. Wasserman, chairman and chief executive of talent and marketing agency Wasserman, is following in the footsteps of his grandfather Lew Wasserman, the renowned former MCA chief, who sat on the 1984 organizing committee.
LA 2024’s proposal, which hasn’t been finalized, includes plans to build only one permanent venue, at Lake Casitas in Ventura County’s Los Padres National Forest, for kayaking and canoeing events, according to Sykes, who is taking a leave of absence from his job as a partner at Goldman Sachs to work on the bid without a salary.
“Our decisions are driven by doing things in the most cost-effective way as possible,” said Sykes. “A very high-quality presentation at the lowest possible cost.”
Sykes said he’d gotten tips from Ueberroth on negotiating deals.
“Peter told me stories of how he negotiated very thoroughly, saying, ‘We’re not out to make a profit, we have nobody to backstop us,’” said Sykes.
Sykes said his goal is to replicate the success of the 1984 games should the International Olympic Committee choose Los Angeles to host the event over rival bids from Paris, Rome, and Budapest. The announcement will be made in September 2017.
“If we run up a surplus, we’ll have the same type of legacy as our responsible predecessors had in ’84,” he said.
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