State officials are negotiating an agreement to sell the Olympic facilities being built with some $59 million in taxpayer money for an undisclosed amount to the privately funded committee that's bidding for the 2002 Winter Games.
The agreement with the Salt Lake Olympic Bid Committee is scheduled to be discussed Monday at the bimonthly meeting of the Utah Sports Authority, the state agency responsible for the facilities.Both Sports Authority and bid officials declined on Friday to provide the selling price or other details of the agreement, which eventually would have to be approved by the Legislature.
Gov. Mike Leavitt, who has not yet seen the agreement, said Friday that he isn't ready to endorse the idea of putting the public facilities into private hands.
"I'm not unpersuadable," the governor said. "There would have to be enough ongoing money to maintain and operate the facilities after the Games or I would like to see the state out of the facilities business."
But because taxpayers are already supposed to be paid back for the facilities out of Olympic revenues, Leavitt said he hasn't been convinced the sale is necessary.
"Clearly those facilities need to be maintained by some sort of public interest-related entity, be it state ownership, the bid committee or some third party," he said. "I just don't want the state to be in a position . . . that they're a drain on the state."
The agreement covers what happens to the Utah Winter Sports Park already open in Bear Hollow near Park City - as well as the ice skating rinks and speed-skating oval - if Salt Lake City is awarded the 2002 Winter Games.
It's already planned that the Olympics would be run by the bid committee with money raised from the sale of television rights and corporate sponsorships. The bid effort is being funded solely through private donations.
What's at issue is whether the facilities being constructed with some $59 million in sales-tax revenue that's being set aside over a 10-year period should be leased during the Games to the bid committee or sold outright.
The agreement calls for the bid committee to buy the facilities and take over the operating and maintenance costs if the International Olympic Committee selects Salt Lake City in June 1995.
The bid committee, which would be actingas an organizing committee if Salt Lake City gets the Winter Games, is already obligated to pay back the cost of the facilities from Olympic revenues.
And the committee is also supposed to set aside a portion of the proceeds for a legacy fund to pay for future operation and maintenance costs as well as athlete development programs.
That's if, of course, the 2002 Winter Games make a profit. The budget proposed in Salt Lake City's bid for the 1998 Winter Games (which went to Nagano, Japan) was more than $750 million.
Tom Welch, head of the bid committee, said the Winter Games would make more money if the facilities are not state owned. Hosting an Olympics "is a business, not a government service," Welch said.
"Optimally, you can run the most fiscally prudent Games if you have the flexibility the private enterprise system" offers, he said. "It's a benefit to taxpayers . . . they'll get their money back."
Also being discussed - but apparently not spelled out in this agreement - is what happens if the bid effort is not successful. There already has been discussion about "privatizing" the state facilities.
Sports Authority Chairman Randy Dryer has speculated in recent meetings that the state's facilities may eventually be turned over to a private company to operate.
"The issue of privatization has been part of the ongoing discussion," Dryer said in an interview Friday. But he said the bid committee would not be the entity that would take over the facilities under such an arrangement.
He said the agreement with the bid committee "would be conditioned upon getting the Olympics. Obviously the bid committee wouldn't have any money to buy (facilities) from us unless they get the Games."