By Amy Shipley
Washington Post Staff Writer
Thursday, September 9, 2010; 11:24 PM
The U.S. Olympic Committee has agreed to pay the International Olympic Committee nearly $20 million over the next two years in a deal designed to help bring an end to a longstanding and acrimonious financial dispute between the two organizations, according to two sources briefed on the information.
USOC officials, still smarting over the losses of New York and Chicago in the recent races for the 2012 and 2016 Summer Games, respectively, hope the agreement helps placate international sports officials who have been angry and resentful about the USOC's portion of overall Olympic revenue, which many claim is excessive.
"This is a big step in the right direction," said Gerhard Heiberg, the chairman of the IOC's marketing commission, in a phone interview from Sweden. "They are sending money back to cover parts of Games' costs."
The deal, however, is only a first step, and an interim one at that.
Heiberg and USOC officials say they hope Thursday's announcement will provide a launching pad for renegotiation of the controversial 1996 deal that gave the USOC a 20 percent piece of the IOC's top-tier sponsorship revenue and 12.75 percent of the U.S. television rights fees.
In the past, USOC officials have been reluctant to give back money or discuss changing those percentages, saying they are owed a more substantial piece of the pie because of the heavy contributions of U.S. sponsors and television rights fees. Thursday's deal, brokered by Heiberg and USOC Chairman Larry Probst, suggests a softening of that position, though it did not alter that contract.
"For a long, long time, some people in the Olympic movement felt like the revenue-sharing might have been unfairly tilted in our favor," USOC Chief Executive Scott Blackmun said in a phone interview from Colorado Springs. "We're moving significant amounts of money directly within the Olympic movement."
Blackmun, however, acknowledged that the IOC's July signing of Dow Chemical to one of the organization's premier sponsorship packages, which brought an influx of funds to the USOC through the 1996 deal, helped facilitate the move. "Without the Dow deal, we would have had to take the money from other programs," he said.
The USOC and IOC, which did not officially release the terms of the deal, said it represented "a significant financial contribution" from the USOC toward paying various administrative costs accrued staging an Olympic Games. Those costs include paying for arbitration panels for disputes and funding a massive drug-testing program.
A deal under previous USOC leadership that would have required the USOC to pay $12 million in cash and $12 million in value-in-kind over four years fell apart because the USOC refused to send the money directly to the IOC, according to a source familiar with those talks. It wanted to give the cash directly to other national Olympic committees.
"We found a solution," Heiberg said. "It's as important to the USOC as it is to the IOC."