The Billion-Dollar Game Essay, Research Paper
The Montreal Olympics in 1976 were a disaster. In his book The Billion-Dollar Game, author Nick Auf der Maur describes how one man’s vision, coupled with his power, cost the city of Montreal untold respectability, as well as a staggering financial debt.
Montreal Mayor Jean Drapeau spent years trying to cajole IOC members into voting for his city in 1970. He was extravagant in his pitches to the IOC “old-money” nobility, while presenting a modest Games which would not cost taxpayers a cent. When the IOC voted for Montreal over Moscow and Los Angeles, Drapeau set into motion a chain of events which would change the course of the city’s history.
Four separate events were to mark the Montreal Olympics as the public relations and financial disaster they were: the sale of the Olympic television broadcasting rights; the construction of the Olympic Village; the construction of the Olympic Velodrome; and the construction of the Olympic Stadium (the “Big O,” which more than anything is a silent reminder to 1976).
Mayor Drapeau and Howard Radford of the COA established the Comite Organisateur des Jeux Olympiques (COJO) to organize the Games, oversee construction of Olympic facilities outside of Montreal, and manage the $80 million Olympic Village mortgage. Drapeau wanted all levels of government represented on the board of directors, which included: the Mayor himself; Gerry Snyder, a city Councillor, as vice-president for revenue; Pierre Charbonneau, president of the Quebec Track and Field Association, as vice-president for sport; Paul Desrochers, advisor to Premier Bourassa; and Roger Rousseau, federal ambassador to the Cameroons, as Commissoner-General.
Desrochers was put in charge of selling the television broadcasting rights for the Games to the world. The Olympic Radio and Television Organization (ORTO), a subsidiary of the CBC, was the host broadcaster for the Games, providing cameras, studios, and equipment at an estimated cost of $56 million. $6 million of this cost was to come from other countries as payments for services; $25 million was covered by a special federal grant; the final $25 million was to come from COJO through the sale of broadcasting rights.
However, any revenue generated from broadcasting rights must be spilt with the IOC and the international sports federations that sanction events at the Games. This meant that COJO had to sell the rights for substantially more than $25 million to realize any profit.
First came the sale of the U.S. television rights. On November 18, 1972, only months after the close of the Munich Olympics, COJO and ABC signed a secret deal giving the network provisional rights to the Games for $25 million with the option to match any higher bid from a rival network (p.44).
NBC and CBS heard about the deal and spent the next month frantically trying to open up the bidding, since the deal was already more or less cemented. Rumours circulated that demands for large kickbacks were being made. Finally, COJO held a press conference to announce that ABC had been awarded the U.S. rights for $25 million although there had been no public call for bids.
With the share due to the IOC and the ISFs, though, COJO had to generate a huge amount from the rest of the world. In particular, COJO wanted $25 million combined from the European Broadcasting Union and Eastern European Television (OIRT). These two organizations had paid a combined $2 million for the Munich rights.
The negotiations were carried out under enormous publicity in Europe, where the locals were aghast at COJO’s demands. It was about this time during the negotiations, that early reports surfaced from Montreal that “Games construction was lagging far behind schedule (p.46).”
It wasn’t until January 1976 that the European television deals were signed. COJO settled for a combined $9.5 million from the European Broadcasting Union and OIRT and earned themselves a public relations black eye in the process.
Mayor Drapeau already had a grand scheme in mind for the Olympic Village after a visit to the Baie des Anges on the Cote d’Azur in Southern France. There lay a spectacular pyramid-shaped complex designed by the French architect Andre Minangoy. Drapeau wanted to bring a model of Minangoy’s work to Montreal to be used as the Olympic Village, and serve as a monument to the world.
Since the design was already “decided upon,” there just remained the problem of finding a firm to do it. Montreal City Council eventually awarded the contract to Les Terrasses Zarolega, an acronym of the four partners who made up the firm: Joseph Zappia, Gerald Robinson, Rene Lepine, and Andrew Gaty. Although Zarolega had problems financing the scheme, the Mayor wanted that design built, and eventually came up with an agreement where the complex would be done and Zarolega stood to gain control of a $90 million investment for only $2 million of its own money. The deal also included a management fee for a percentage of costs – which encouraged Zarolega to spend more on the project, since they would make more.
Needless to say, the deal was highly irregular. In the process, Drapeau and City Council rejected plans for temporary villages, use of university residences, and even a floating village, all of which would have saved countless millions of dollars and Viau Park, a local green space where the Olympic Village was constructed.
All work on the site was structured to be as expensive as possible, since increased costs led to increased management fees. Efficiency and coordination were nowhere to be found on the project.
Eventually, the RCMP raided the offices of Les Terrasses Zarolega and COJO member Simon St-Pierre and seized boxes of documents pertaining to the Village project. Their investigation of the proceedings lasted many months, and Auf der Maur alleges that the police were “told to lay off until after the Games. The Montreal Games had had all the bad publicity they could handle (p.85).”
Only months before the beginning of the Olympics legislation was introduced in Quebec Assembly to expropriate the Village in return for Zarolega’s original $2 million investment. Once again the Olympics took bad public relations and a financial loss in the process.
The sale of the Olympic television rights and the Olympic Village project were representative of what happened with the Olympic Velodrome and Stadium projects, only now Mayor Drapeau had French architect Roger Taillibert at his side, a man with equally grand vision as Drapeau himself.
Taillibert was responsible for both building designs, and was not shy about being grandiose. However, in the French tradition, no specifications came with the design (in France, the engineers are responsible for the adaptation). This led to mass confusion and countless expenditures, since Drapeau had ordered that Taillibert be given carte blanche.
As at the village, costs were through the roof since contractors had been given cost-plus guarantees in their contracts (most of which were never signed). Organization was at a premium, tardy plans were the norm, and complex new techniques proved difficult to introduce.
In the end a temporary velodrome had to be built for the World Cycling Championships after millions had already been spent on the Olympic Velodrome, which couldn’t be completed on time. And the Olympic Stadium, originally budgeted at $200 million, ended up costing $700 million and has been falling apart due to shoddy workmanship ever since.
Ottawa refused to provide direct financial support to Drapeau’s Olympic project, as Prime Minister Pierre Trudeau was skeptical about the whole affair. For example, though, Drapeau could have had federal and provincial assistance had the Olympic Village been eventually destined for low-rental housing, as was promised in Drapeau’s Olympic bid.
Eventually, the province had to come in to rescue Montreal from drowning financially in the mess. In the process, they ousted Drapeau from leadership of the Olympic project, and restored enough organization (they weren’t much better) to have the Olympics ready for the world in 1976, avoiding immense embarassment to Montreal, French Quebec, and Canada.
Regardless of any success the Montreal Olympics may have had as an athletic event, Auf der Maur points out that politically and financially, they were nothing short of a fiasco. Mayor Jean Drapeau’s self-financing Games ended up $1 billion over budget, earning himself the ire of federal politicians, IOC delegates, and perhaps most importantly from a political standpoint, his fellow Montrealers. Auf der Maur argues that the principles behind Drapeau’s self-financing Games “were essentially sound,” but that “he either didn’t know how or was unwilling to put them into practice (p.138).”
It seems that the latter was true. Drapeau was consumed by gross egocentrism when dealing with the Olympic project. His passion was to create a lasting spectacle worthy of the ancient monuments, rather than simply host a great Olympic Games. He had the perfect accomplice in Taillibert, who fancied himself a modern day Michelangelo. The “enthusiasm” of the pair went unchecked, since their lavishness directly resulted in millions of dollars in profits for contractors, developers, and consultants. Everyone had their hands in the Olympic pie, and when the pie tastes that good, few care whether they’ve eaten too much.
What is interesting to note is how long Premier Bourassa waited before seizing the reins from Drapeau. Bourassa was clearly nervous about Drapeau’s power and the political ramifications an attempted coup might have. Eventually though, he decided that the potential political benefit (as saviour of the Games) outweighed the risk of reprisals for removing Drapeau from the scene. As Auf der Maur notes: “the answers were not to be found on the financial balance sheet but on the political balance sheet (p.127).”
Although the Olympic fiasco was fundamentally an organizational problem, it required very real financial solutions. First though, Bourassa’s political position had to be assured before any money came forth. Once it was, the money was less of a problem – where there is a political will, there is most often a financial way.
What is concerning is the fairly abrupt change from Drapeau as Olympic saviour with his self-financing Games to Drapeau as egomaniac with his absurdly over-budget Games. How did it happen? Two scenarios present themselves: either Drapeau became so consumed by his position of influence and previous success with the IOC that he was swept along with the madness; or, the concept of the self-financing Games and IOC delegate schmoozing was all an elaborate, calculated political sham designed to make Drapeau the lead actor when Montreal took to the international stage.
The latter thought is more frightening, since it undermines the trust we have in leaders who would have us believe they are doing what’s best for us. The citizens of Montreal certainly thought things were being done properly and in their best interests. Today they are saddled with a huge debt, and an indelible reputation as the city that botched the Olympics.
Bibliography
Auf der Maur, Nick. (1976). The Billion-Dollar Game. (Toronto: James Lorimer and Company, Publishers).