GAMES VENUES I Despite tightening designs costs expected to escalate by 50 per cent
GARY KINGSTON
Sun
VANCOUVER I Organizers of the 2010 Olympics have cut capital costs by tightening designs of Games venues, but may still need help from government with construction costs expected to escalate as much as 50 per cent, John Furlong said Friday.
In a status report speech to the Vancouver Board of Trade, the CEO of the Vancouver Olympic Organizing Committee (Vanoc) said reports about the construction sector in B.C. would have you “think the sky is falling.”
But he still conceded that with $70-$75 billion in construction projects on the books for the next three years in a “frenzied” southwestern B.C. marketplace, he is worried about the availability of skilled labour, the lack of housing for those workers and rising steel and concrete prices.
“Escalation today for projects being built today is running at 40 to 50 per cent,” he said.
Challenged by reporters after the speech, Furlong refused to say that Vanoc has approached the B.C. or federal governments directly for more cash, insisting only that “we’re having a dialogue with them about our situation.”
But he mentioned several times that cost estimates on the $470 million in new facility construction — everything from the bobsled and luge track at Blackcomb to the athlete villages to the speed skating oval in Richmond — were done in 2002 dollars and that those costs “need to be protected through 2007” when the major contracts will have been let.
The federal and provincial governments have committed to splitting the $620 million total capital cost of the Games, but Victoria is the one legally on the hook for any shortfalls once the Games are over.
Furlong said Vanoc has cut about $85 million in 14 months from the original capital costs budget by refining designs, taking out elements that are too challenging to build and moving the broadcast centre downtown from Richmond.
“We’ve got very serious about making sure we’re building what we have to build . . . and being creative to mitigate against a very serious challenge,” he said.
“We’re looking at other elements, such as getting assistance and we’re looking to our partners about the situation that we’re in.”
So far, Vanoc has spent about $14 million in preliminary work on the Nordic Centre in the Callaghan Valley and $6.5 million on the sliding centre at Blackcomb. Both projects now have been shut down for the winter, but the early work came in on time and under budget, said Furlong.
Furlong said Vanoc’s revenue target remains “north” of $1.7 billion, but once again reiterated that the organization won’t be in a position to release a comprehensive budget on the expense side until after the 2006 Games in Torino have been analyzed.
Furlong, who often talks about creating a culture of cooperation built on the vision of the Games ability to touch the soul of the country, also challenged contractors to be fair with pricing, “to be part of the solution and help us with the project.”
“We want motivated contractors . . . we want them to rise to the occasion be at the top of their game . . . want their best people on the job, people who care about what they’re doing.”
In his wide-ranging 40-minute speech, Furlong also warned that the Games can’t be “put in harm’s way” or embarrassed by labour disruptions.
He also said there is too much focus already being put on security, calling the issue a great headline-maker.
“The worry we have is that the agenda will get ambushed to some degree by outside forces, by a lot of what I would call alarmist rhetoric about stories that are planted by folks who stand to make lots of money by being involved in this area.”
Asked later to clarify his comments, he said “every time you open up the paper, somebody from some university or some company that’s involved in security is talking about all the things people have to be worried about, just creating a lot of difficulty for organizations that are trying to do their job.
“What we need to do is try and be focused on what this is about, about sport and athletics.”
