Page 1

$4.3 MILLION DEFICIT IN WINTER OLYMPICS The New York Times October 5, 1980,

Sunday, Late City Final Edition

1 of 1 DOCUMENT

The New York Times

October 5, 1980, Sunday, Late City Final Edition

$4.3 MILLION DEFICIT IN WINTER OLYMPICS

BYLINE: By HAROLD FABER, Special to the New York Times

SECTION: Section 1; Part 2; Page 51, Column 1; Metropolitan Desk

LENGTH: 797 words

DATELINE: ALBANY, Oct. 3

The first independent financial analysis of the 1980 Winter Olympics in Lake

Placid shows an operating loss of $4,366,029.

The financial review, made at the insistence of government officials, also

showed claims against the Lake Placid Olympic Organizing Committee of $21.5 mil-

lion, arising mainly from construction disputes. The analysis was released at a

White House conference of organizers and state and Federal officials early this

week.

At the meeting, the organizers asked for $8.5 million in additional financial

aid from the New York State and Federal governments to pay creditors and to set

up a reserve fund for the disputed claims and other last-minute expenses.

Without the funds, they said, bankruptcy was probable.

''It's encouraging,'' said Peter Lynch, an official of the New York State

Budget Bureau, who has been following the Olympic Committee's financial troubles

ever since the games ended last February.

''We are ready to sit down with the Federal Government and get the thing

settled,'' said Mr. Lynch, who attended the meeting in the White House. ''I am

confident we can work it out.''

However, at the White House, Joseph Onek, a deputy counsel in whose office

the meeting was held, was more reserved. ''We can now start to make a real de-

cision,'' he said.

 

Federal Stance Shifting

Up to now, the Federal officials who supplied most of the money for the con-

struction of the new facilities for the Olympic games have taken a firm stand

against supplying any more funds to the Olympic Committee.

But, in the heat of a Presidential campaign in which New York State is con-

sidered critical by both parties, they are apparently rethinking the situation.

''We're very optimistic that we will get the money,'' said Ed Lewi, press

representative for the committee. Both state and Federal officials have been

awaiting an independent financial audit of the games before making any commit-

ments about supplying additional funds. ''

 

Page 2

$4.3 MILLION DEFICIT IN WINTER OLYMPICS The New York Times October 5, 1980,

Sunday, Late City Final Edition

This week's unaudited financial statement was made by the accounting firm of

Peat, Marwick and Mitchell. According to one state official, the indications

were that the audited report of the Olympic Committee's books would not be more

than $500,000 off the statement issued.

The statement said that it cost $60.8 million to administer and operate the

games, with the major expenses in operations, $19.4 million, and marketing, $17

million.

The revenues - including television rights, $13 million; marketing and li-

censing contracts, $17.7 million; ticket sales, $12.2 million, and contribu-

tions, $7.4 million - totaled $56.4 million.

 

Construction Cost $72 Million

The report also showed construction costs of $72 million, most of which was

paid for through the Federal Economic Development Administration. In addition,

although the report did not mention it, the state contributed about $40 million

for improvement and renovation of state-owned facilities at Mount Van Hoeven-

berg, where the bobsled run was held, and White Face Mountain, where the down-

hill speed skiing races and the slalom competitions were held.

The most expensive construction items were the $17.9 million housing complex

for athletes at Ray Brook, which has just been converted into a prison; a new

fieldhouse in Lake Placid Village, $14.9 million, and the ski jumps, $5.9 mil-

lion.

A footnote in the report also showed that the organizers had obligated them-

selves to pay $1.5 million as a fee and $2.3 million in costs to the Gilbane

Construction Company, which supervised the construction.

Most of the claims against the committee are in $21.5 million in suits, filed

or pending, by construction contractors. But, according to William Lussi, gener-

al counsel for the committee, it feels that these are exaggerated and it has in-

cluded a reserve fund for potential damages within the $8.5 million it has re-

quested from the state and Federal governments.

 

A Profit-Cost Statement For the Winter Olympics

 

Special to the New York Times

ALBANY, Oct. 3 - Following is a balance sheet for the 1980 Winter Olympic

Games, taken from a financial analysis prepared for the Olympic organizers by

the accounting firm of Peat, Marwick and Mitchell:

 

REVENUES

Television Rights $13,092,221 Marketing and Licensing 17,750,993 International

Olympic Comm. 1,000,000 Contributions 7,368,835 Miscellaneous 590,177 Ticket

Sales (net) 12,224,145 Accommodations 2,421,260 Proceeds on Disposal of Assets

751,605 Investment Income 625,710 Restricted Gifts 656,339 Total Revenues

$56,481,285

 

ADMINISTRATIVE COSTS

Executive $6,897,343 Protocol 4,104,769 Marketing 17,014,290 Engineering and

Construction 7,612,260 Operations 19,439,569 Press and Public Affairs 2,636,914

Sports 3,089,034 Other 53,135 Total Costs $60,847,314

Deficit $4,366,029

 

Page 3

$4.3 MILLION DEFICIT IN WINTER OLYMPICS The New York Times October 5, 1980,

Sunday, Late City Final Edition

LANGUAGE: ENGLISH

GRAPHIC: Illustrations: table of Olympic revenues and administrative costs

Copyright 1980 The New York Times Company