An independent review of Chicago's Olympic budget finds tourism and revenue projections are inflated.
There are dramatic differences between what the city's bid committee projects and what the review's numbers reveal. That's the conclusion of the Anderson Economic Group that issued its report on Thursday.
The decision on the host city for the 2016 Games is less than eight days away.
The new review of the potential impact of the games found Chicago's bid leaders are double counted when calculating some of economic upside of the Olympics. For example, 2016 claims 30 million people will come to town for the Games, but fails to note some of those visitors and their money would have come anyway as part of the normal summer tourism season.
Nonetheless, the study concludes the potential upside of the Olympics is worth the risk.
A Chicago Olympics would be the economic equivalent to hosting 12 Super Bowls back to back. That's the conclusion of a firm that analyzes the impact of sporting events.
Not bad, but Chicago 2016's forecast of $7 billion in extra tourism spending would be the equivelant of 70 Super Bowls.
Hard to believe, says analyst Scott Watkins.
"When you look through their report, one plus one doesn't always equal two," said Scott Watkins, Anderson Economic Group.
Watkins' independent review of the Olympic budget finds staging the Games involves both "substantial cost, and substantial risk."
Tops on the risk list: The proposed Olympic Village. It would be completely financed by private developers. 2016 has letters of intent from several firms agreeing to take on the project, but even the International Olympic Committee points out those are just promises on paper.
As for the prospect of cost overruns and the risk to taxpayers...
"If expenses are 10 percent higher, Chicago will have to chip in to pay that bill, and even if they have to do that - they have to go into taxpayers' pockets - the city still should made enough extra money on tourism and construction to off-set that," said Watkins.
The Anderson Economic Group study says Chicago 2016 has made some "ambitious revenue projections" -- but on the whole concludes "Chicago has the potential to stage a successful Games, with significant long-run benefits to the entire region."
"There's always that type of risk, that's why you buy insurance for those things. But the odds of that seem pretty low so it seems like a good investment for the city," said Watkins.
Chicago 2016 stands by its figures that predict a $22.5 billion economic impact for the region, and the equivalent of one year's worth of work for 315,000 people.
A spokesperson pointing out that despite the differences in numbers, both studies conclude a big economic upside if we get the games.
Tune into ABC7 at 6 p.m. for a one-on-one interview with the biggest backers of our competition. Ben Bradley interviews the head of Madrid's bid in Spain and we'll hear from the president of Brazil. He'll be in Copenhagen next week pushing for Rio and tells ABC7 what he says President Obama should do next week.
