He obtained profits at the 84 Olympic Games. The 2028 games can fall short

Los Angeles achieved a rare feat in 1984: the city obtained profits at the Summer Olympic Games. It seems that this may not be easy in 2028. And that could come in a bad time for the city.

“The city of Los Angeles, financially, we are in trouble,” wrote the Kenneth Mejia controller in a recent letter to Mayor Karen Bass and the City Council. Less income and higher expenses total a projected deficit of $ 140 million for the current fiscal year, and an additional decrease of $ 73 million next year.

Los Angeles is “Spend too much” for $ 300 millionMeija wrote. A budget officer of the upper city recently estimated that The budget deficit could reach $ 1 billion In his next fiscal year. Last week, state legislators requested another $ 1.9 billion In funds, after receiving $ 2.5 billion, to help with the recovery efforts of the city of January forest fires.

LA28, the non -profit private company organized by games 2028, has a Budget of $ 6.9 billion Financed by corporate sponsorships, license agreements and a significant contribution of the International Olympic Committee. The budget covers expenses such as renting sports sands, personnel costs and housing athletes.

But if the budget of the Olympic Games do not join exactly as planned, taxpayers could remain paying part of the invoice, and the and its Olympics committee know the risks of overcoming cost estimates. In 2019, The La28 budget increased for $ 1.36 billion. Yeah La28 budget It does not yet prove to be sufficient, the city of Los Angeles will be responsible for the next $ 270 million in funds. After that, the California state government will be responsible for the next $ 270 million, with the next $ 270 million after it becomes the financial burden of the.

The host cities of the Olympic Games have a long history of financial failure

Yeah Recent history It is any indicator, it is fair to worry that the 2028 Summer Olympic Games exceed the budget. In the last 60 years of host cities, almost none has been profitable or has remained in the budget.

Sydney 2000 Olympic Games in Australia ended 90% more from the budget after spending more than $ 5 billion. The 2004 Athens Olympic Games ended approximately 50% more than the budget, at $ 3 billion, due to excesses and growing debt. He Summer Olympic Games 2016 The cost of Rio de Janeiro reported $ 20 billion. The Olympic Games have not been profitable that when London broke even with the 2012 summer games, some judged for some as a success.

Miles Osgood, a professor at Stanford University and researcher at the Olympic Games, says that the organizers of the, which are based on lessons of 1984, have made responsible budget plans that position the city with a financial advantage that enters the Games, compared to other recent host cities. As in 1984, it plans to use sites and structures that already exist, which saves costs related to the new construction. Use of existing places It is expected to save More than $ 150 million.

But the envelope $ 200 million earnings Los Angeles generated that the last time she hosted the games in 1984 occurred in the midst of circumstances very different from today. Specifically, games are much larger. It will organize 36 Olympic sports in 2028, instead of 21. In 1984, there were 221 events and 6,829 athletes. In 2028, there will be 800 events with 15,000 athletes. The largest numbers multiply related costs (for example, security, transport, personnel, rooms in the Olympic village) “That fungus outside those basic figures,” said Osgood.

Even before forest fires introduce an unexpected financial challenge and infrastructure for Los Angeles, the city housed a significant anti-olympic feeling. Osgood pointed out that angels is essential for the “Nolympics” campaign, A movement Concerned about, among other things, the housing crisis and the lack of local democracy in the planning of the games. He has tried to expose the bad offers that the hosts always make by welcoming the Olympic Games, and the group has expressed the 2028 games since forest fires.

Despite criticism, he is confident that the games will judge a success. Paul Krekorian, president of the City of Los Angeles, recently He told New York Times“I think the 2028 games will benefit the angels for the coming generations.”

For many residents who still collect the pieces of life after home losses, the typical spirit associated with the host of the Olympic Games may not capture their mood in the traditional traditional way. “In 2028, when whole neighborhoods can still be clearing the ashes, the Olympic flame will not be a welcome symbol,” Osgood said. “You can easily imagine how the Olympic slogan of Los Angeles, ‘follows the sun’, will go, since protesters make calls, however, to follow the money,” he added.

Forest fires in mid -January displaced tens of thousands of California residents and more 18,000 structures were destroyed.

It is estimated that recent forest fires will cost approximately $ 40 billion In insured losses.

From an infrastructure perspective, forest fires should not be a problem. None of the 2028 Olympic Games places was damaged by fires. UCLA, which has served to serve as housing athletes in the Olympic village, emerged unscathed. Experts say that it is likely to remain the place for many of the athletes attending the 2028 games.

But Meija recently said that the fiscal stress of the city could not arrive at the worst time given forest fires. “We have gone from the record levels of general fund reservations 18 months ago at the edge of the need to officially declare a ‘fiscal emergency,” he said. “This additional stress in the budget in addition to the growing responsibilities to prepare for the Olympic and Paralympic Games in 2028”.

While forest fires are not a rare fact in California, the scale of destruction to homes, business and public infrastructure is considerably higher than the Los Angeles area generally experiences, according to Matthew Burbank, a professor at the University of Utah who has worked extensively in Olympic urban policy.

LS Angeles may take several years to rebuild, but Burbank said they do not expect forest fires to have a direct impact on the planning of the Olympic Games, or any funds currently destined for the Games to be redirected from the Olympic Games to relief of forest fires. “Most likely, the city’s approach to budget excesses of costs would be to expect not to happen, and if they do, then the city will have to discover how to pay those costs,” he said.

But he added that the general impact of the reconstruction of forest fires of several years in the public financial situation cannot be denied.

“There may be lasting impacts on the budgets of the state and local government that will continue in 2028 and beyond,” he said.

Disclosure: Father CNBC NBCuniversal has NBC Sports and the NBC Olympic Games. NBC Olympics is the head of US transmission rights for all summer and winter games until 2032.