CHICAGO — The International Olympic Committee in its first round of voting Friday dashed Chicago’s $48 million push to host the 2016 Summer Games, an effort championed by Mayor Richard Daley as a means to highlight Chicago as a world-class city while spurring job creation and economic development across the region.
When the final round of voting was completed in Copenhagen on Friday, Rio de Janiero’s $14.4 billion bid emerged as the victor over Chicago’s $4.8 billion plan and ones submitted by the other finalists Tokyo and Madrid.
Daley, who has rarely lost a vote in the City Council during his 20-year tenure, was a tepid supporter of pursuing the games just a few years ago, but later became an impassioned enthusiast. He tapped prominent businessman Patrick Ryan, founder of insurance giant Aon Corp., to lead the effort that included persuading corporate leaders to foot the $48 billion bill for putting together the city’s bid.
Though public opinion on hosting the games remained divided, Daley portrayed the Olympics as an economic boon that would help revitalize the southern shore of Lake Michigan and create new, lasting development and jobs while also drawing tourism dollars and public funding to upgrade the region’s aging transportation system.
A recent report from the Anderson Economic Group LLC estimated the economic impact of the games at $4.4 billion, not $19.2 billion as a city bid-commissioned study had previously reported. The report also warned that there was some doubt the city could raise the $1 billion in private funds needed to construct the Olympic Village.
Although the city pledged $500 million in the event the Olympics lost money, Daley vowed that no taxpayer funds would go to actually fund the games, and that the city’s risk of being forced to tap the $500 million was minimal due to $2 billion in insurance coverage and a state guarantee that would kick in first.
A City Council-commissioned report conducted by the Civic Federation of Chicago organization found the city’s $4.8 billion operating budget reasonable. Its analysis said the city had adequate protections against financial risks, but that additional insurance was needed to protect against the construction risks of building the Olympic Village. The city has already purchased the land that was to house the village, and Daley has pledged to develop it.
