(Featured Image: montrealenlumiere.com)
Growing up in Montreal, I’ve heard my fair share of opinions about the biggest projects in Montreal’s recent history. In grade six, I learned about the Expo 67 and the ’76 Games. My teacher portrayed the first favourably, but was very critical of the latter, mentioning that it had a billion dollar price tag which the taxpayers only finished paying off in 2006. This negative view stuck with me and each time I would go to the Olympic Park as a kid – whether it was to get on top of the Observation Tower, or to go to the Biodome, or just to marvel at the structures – I could not help but think of the price tag and whether it was all worth it or not.
The media enjoys portraying this side of the story. ‘The Big O,’ a name given to the stadium because of its O shape, has been often called ‘the Big Owe,’ perhaps rightfully so. In 1972, Mayor Jean Drapeau proclaimed that the Montreal Games would be the first self-financed Olympic Games. However, the net cost was several times higher than projected, which prompted political cartoonist Ainslin’s famous cartoon of a pregnant Drapeau calling an abortion clinic. The price tag caused the Quebec government to absorb the debt; in the end, it took 30 years to pay off the debt accumulated during the construction of the facilities.
So what did the City get in return? This article attempts to portray the Montreal Olympics in a different economic and financial light. While it is only meant to be an overview, it aims to provide a fuller view of the Games, showing that the City did get something in return for its investment.
The most obvious legacy of the Montreal Olympics is the remaining infrastructure of the Olympic Park. Designed by architect Roger Taillibert, the Olympic Stadium and Park remain iconic, but the current image of the Olympic Tower and the attached retractable roof was only a later addition. Indeed, by the time the Games began, neither of these were part of the plan, but they may have been necessities, as the roof would allow for the stadium to be used in the winter, while the inclined tower made sure that the roof wouldn’t collapse. Due to several moratoriums on its construction imposed by the Quebec Government, the $175 million tower was only inaugurated in 1987. This investment has brought Montreal world-wide acclaim: the inclined tower holds the Guinness World Record of “Tallest manmade leaning tower” and attracts about 250 000 visitors per year. Last year, the Quebec Government approved of a $166 Million renovation plan that will allow 1300 Desjardins employees to work in the Tower by 2018, further utilizing the structure.
The stadium itself was also put to good use following the games, acting as the home venue for the Montreal Alouettes until 1986 and the Montreal Expos until 2004. It has also been host of various exhibition games and concerts over the years. Currently, the Olympic Park has around 150 permanent employees and 800 seasonal employees. As for the Velodrome, adjacent to the Stadium and home to the Games’ cycling and judo events, it was later converted into the Biodome between 1988 and 1992, a project of $50 million. Since then, it has attracted approximately 900 000 visitors annually and is an important hub for wildlife conservation and research. As for the Olympic village, the buildings were turned into apartments and later sold as condos. These structures certainly generate their share of maintenance fees and taxes, but the fact is that they are still in use today, forty years after their construction. This is in stark contrast to Olympic complexes in other countries that were abandoned after the Games, such as the one in Athens. While the entire Olympic project did cost over $1.5 billion, and was plagued by delays and mismanagement, it was also an worthwhile investment in making the structures usable by Montrealers for many years to come.
In 1978, John Iton, then a professor at McGill University, undertook a study analyzing the costs and benefits of the Olympic Games on Montreal, the Province of Quebec and Canada. In a meticulous 200-page report, he explores the ways in which the Olympic Games have affected fixed capital, the travel industry, health and fitness, aspects of the Games themselves, such as security, broadcasting and press coverage, and finally the programs designed to finance the project, such as the Lottery or Coins program. He made sure to acknowledge all externalities and intangibles in his report.
One worthwhile point of analysis in Iton’s work pertains to the economic impact of the Olympics on the health and well-being of Montrealers. This is quite relevant, as part of the goals of hosting the Olympics is to encourage amateur sports among residents. Between 1970 and 1972, Canada’s life expectancy at birth for males was 69.34 and 76.36 for females; Quebec had the lowest expectancy in both categories among the provinces – 68.28 years and 75.25 years respectively. In 2015, Canada’s life expectancy was 80.24 for males and 84.13 for females, and in 2016, the life expectancy in Quebec was 80.8 and 84.5 years respectively. While it is unclear exactly how much of the increase is due to the Olympic Games, increased life expectancy clearly benefits the Quebec economy by decreasing the amount of foregone labour output due to premature deaths. The development of sport programs for Quebec youth undoubtedly played a part in producing healthier adults.
One interesting repercussion of Montreal’s Olympic Games is the creation and management of a state-sponsored lottery. When Mayor Drapeau announced his budget, he included $30 million that would be funded through lottery sales. The idea was rather startling, because legislation about lotteries would have been new at the time. Before 1969, lotteries were considered to be a form of gambling and were prohibited. In 1969, an amendment was made to the constitution, allowing for the creation of Loto-Québec. In 1973, legislation for the Olympic Lottery was approved, with its first draw occurring in November that year. The lottery was an unequivocal success. Over the years prior to the Games, it generated more than its projected 30 million dollars of revenue. The organizers saw it as a voluntary tax. After the Games, the Olympic Lottery paved the way for the incorporation of Loto-Canada in 1976. The profits went primarily into financing the debt and sports programs, as well as programs to fight compulsive gambling.
The election of a progressive conservative government in 1979 changed the state’s standpoint on the national lottery. As a result, Loto-Canada was disbanded in favour of provincial constituents and the federal government abandoned any control of lotteries as of 1985. In 1992, the government created another entity under Loto-Québec, the Société des Casinos du Québec, and the Montreal Casino was inaugurated in the former Expo 67 France Pavillion. Ever since, Loto-Québec has flourished, becoming a multi-billion dollar company that redistributes its profits into government initiatives. The organization sponsors numerous events and festivals, such as the Rogers’ Cup and the L’International des Feux Loto-Québec.
Paul Howell, an organizer of the Montreal Games, once said: “The word deficit has different meanings in different circumstances. If a state, for example, decides to fund Olympic Games, such as Germany in 1936, Moscow in 1980 or China in 2008, all questions of deficit are moot.” To some extent, he was right. In this case, it was not the extent of the deficit from the construction of the venues that was the issue; it was the question of financing it. The original plan was to finance the debt through lotteries and a tobacco tax. In original estimates, the debt would be paid off by 1982. As the payback would last several years, the time frame is susceptible to changes in government at every level; when Loto-Canada was disbanded, this target was no longer realistic. Because the tobacco tax was also contingent on the values of the incumbent Quebec government, every change of power led to changes in the taxes, causing full payment to be completed in 2006. This makes the Montreal Olympics no different from other large-scale projects: large delays, inconsistencies in paying back accrued debt, but a great end result.
2017 is a big year for Montreal. On May 17, the City celebrated its 375th anniversary with a light show on the Jacques Cartier Bridge that cost just under $40 million. And this is only one of 42 projects totalling over $1 billion to revitalize the city. Of course, many of these projects are delayed and will only be completed in 2020. We might question the extravagance and laugh at another classic example of “Montreal’s construction delays,” but that is just part of the story. When these projects are completed, we will be more willing to embrace, cherish, and benefit from them.
In his final interview two years prior to his death in 1999, Jean Drapeau told the Gazette, “You have to think about the future all the time, and thinking about the future costs money.” He would certainly be proud today: thanks to his Expo 67 and the ‘76 Games, Montreal is celebrating once again.