Revised Calgary 2026 Olympic Bid Math is Fiction

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On Wednesday October 31st, The City of Calgary shaved less than 4% off the proposed Calgary 2026 Olympic Winter Games bid math by claiming saving in security and venue changes.  While this is an improvement, the numbers just don’t add up because:

  1. Many of the numbers presented are in 2026 dollars but there is an ugly force called inflation that changes the values.  Put simply 2026 dollars are worth much less than 2018 dollars, so you need more of them.
  2. The security budget is already at half of what Vancouver’s cost after inflation in.  When was the last Olympics to have a smaller security budget… hmmmm
  3. Our analysis of Olympic cost overruns from 1972 through 2018, shows that it is unlikely that any Olympic Games will come in under double their original budget.

Below are two scenario’s as we calculate them and in both Calgary is on the hook for drastically more expense than has been presented publicly so far.

This first chart shifts all of the money to 2018 dollars and assumes most of the money is paid to Calgary for construction in 2024
(assuming a very conservative inflation of just 2.5%/year)

Calgary 2026 Olympic Cost Breakdown - 2018 Dollars

Calgary 2026 Olympic Budget  in 2018 Dollars
Money Source  Amount
International Olympic Committee  $          1.03B
Province of Alberta  $          0.60B
Canadian Federal Government  $          1.47B
City of Calgary City of Calgary  $          0.55B
City of Calgary Ticket Sales & Sponsorship Revenue  $          1.45B
Nov 2018 Official Budget  $          5.1B

 

This second chart shifts all of the money to 2026 dollars and assumes a VERY modest 30% budget overage
(assuming a very conservative inflation of just 2.5%/year)

Calgary 2026 Olympic Cost Breakdown - 2026 Dollars

Calgary 2026 Olympic Budget in 2026 Dollars  with modest 30% cost overrun
Money Source  Amount
International Olympic Committee  $          1.200B
Province of Alberta  $          0.700B
Canadian Federal Government  $          1.750B
City of Calgary City of Calgary Planned  $          0.670B
City of Calgary City of Calgary Overage  $          1.450B
City of Calgary Ticket Sales & Sponsorship Revenue  $          2.230B
2026 Likely Cost  $          8.000B

We know there are assumptions built into these numbers like:

  • the Province of Alberta might kick in more money
  • the Canadian Federal Government might not pay the full amount after they figure out how much money we all owe in Federal debt
  • inflation might be will be more than 2.5% over the next 8 years

These numbers are not presented as hard facts but as much more accurate numbers than have thus far been presented by the City of Calgary or BidCo 2026.  We think when you simply adjust the dollars for inflation so that when you hear the number $1.75B from the Feds, you know that is really $1.47B in today’s dollars, you will be able to make a more informed choice during the November 13th 2018 plebiscite.

If you have not already skimmed through it, you should spend a few seconds on our analysis of Olympic cost overruns from 1972 through 2018.  You will see that that on average Olympic bids are underestimated by more than 100%, so our second chart, using just a 30% cost overrun, is very very reasonable.

Also note that we would love to have the Olympics in Calgary so we are not “grinding an axe” here.  We are simply trying to shed light on what appear to be fictional numbers used to blindly promote the Calgary 2026 games.

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