USOC IN LIMBO PART III
U.S. Olympic Committee weighs the highly charged option of government funding for its cash-strapped programs
Thursday, January 14, 2010
The U.S. Olympic Committee for years trumpeted its financial independence from the U.S. government. It still calls upon the old advertising slogan, "America doesn't send athletes to the Olympics, Americans do" in soliciting private donations. The organization likes to project the image of a bootstrapping U.S. team carried to the Olympic Games on a magic carpet of personal checks and hard-earned American dollars.
But the current recession and new leadership have brought a willingness to consider another vision: a government-supported USOC.
A topic once virtually off-limits is now up for discussion. USOC Chairman Larry Probst and other officials agree the organization's hazy economic future brings with it the responsibility of contemplating new sources of revenue, with possible government funding high on the list.
The issue, however, is rife with complexity, philosophical and practical concerns and differing views. Past and present USOC officials wonder about the potential impact of such a dramatic step on the organization's autonomy, and some fear a backlash from loyal private donors who annually write $50 or $100 checks because they believe their small contributions will help a struggling young athlete make it to the Olympic Games.
"There is a cost to doing business with the federal government," said Steve Bull, who departed late in 2008 after 18 years as the USOC's director of government relations. "You can't be naive."
There is also the practical question of whether the USOC could secure the backing of Congress and the White House, particularly after another round of management turmoil on the heels of Chicago's embarrassing first-round exit in the October selection for the site of the 2016 Summer Games despite a personal appeal by President Obama.
"I always said, 'You've got to deserve it,' " Bull said. "In the whole scheme of things, where are we in contrast to . . . name-your-issue?"
Flush times are over
Despite the concerns, USOC officials believe finding new revenue streams over the next decade could be critical to continuing the nation's traditional Olympic medal success. Chicago's defeat brought into focus the treacherous economic landscape ahead; the USOC, by all accounts, will stand on solid financial ground through the 2012 Summer Games in London, but it is living largely off lucrative contracts signed before the economy crashed, many of which are due to expire.
About 27 percent of the USOC's budget for the four years leading up to the 2008 Beijing Summer Games came from a record $2 billion U.S. Olympic television deal with NBC signed during flush times. Executives fear that figure won't be surpassed when the next television contract -- for the 2014 Winter Games in Sochi, Russia, and the '16 Games in Rio de Janeiro -- is negotiated next year.
Meantime, the USOC has lost a trio of sponsors -- Home Depot, General Motors and Bank of America -- since last summer, and though it has signed up Procter & Gamble and renewed with AT&T, officials say the Olympic rings are simply a more challenging sell in a miserable economy with no upcoming Games on U.S. soil. The organization laid off more than 10 percent of its staff last year; some of the smaller national sport governing bodies under its umbrella are struggling financially; and expenses related to travel, housing and medical insurance are rising.
"The fact that Chicago did not win the bid makes things a bit more challenging, but I still think there is ample opportunity to renew existing sponsorships and find new sponsors," Probst said. "We've also got to be looking for new revenue streams that didn't previously exist, and we've got to examine the possibility of government funding going forward."
The only government funds directed toward the USOC since it came into its current existence under the Amateur Sports Act of 1978 came in the form of a $10 million appropriation from Congress in 1981 to stave off bankruptcy after the United States boycotted the 1980 Summer Games in Moscow, and as much as $40 million in 2008 for Paralympic support for disabled veterans of the U.S. armed forces through 2012.