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William Oscar Johnson
February 22, 1993
In Atlanta, yesterday's Olympic joy is gone with the wind as harried organizers count down to the start of the '96 Games
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February 22, 1993

The Clock Is Ticking

In Atlanta, yesterday's Olympic joy is gone with the wind as harried organizers count down to the start of the '96 Games

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Billy Payne, the visionary former Georgia football player and ex-$250,000-a-year Atlanta real estate lawyer who dreamed up and then led the campaign that brought the 1996 Summer Olympics to Atlanta, says he has a clock in his head that counts his Olympic days, both forward and backward. As of Monday his forward-looking clock indicated that 1,250 days remained until the Games begin, on July 20,1996, and his backward-looking clock showed that 2,207 days had passed since Feb. 10,1987, the day he was smitten with the idea that he could bring the Olympics to Atlanta.

The good news is that Payne's lick-tick-ticks have now counted off nearly two thirds of the time it will take to reach the culmination of his Olympic dream (to say nothing of the day when silence returns to his head). The bad news is that the best of times are cither far behind—such as the glorious day in Tokyo in September 1990 when the International Olympic Committee (IOC) awarded Atlanta the Gaines—or far, far ahead, in the golden Olympic tomorrows of '96. In the interim lie the worst of times, when the headaches build, the conflicts escalate and every day is full of doubt and accusation.

As president, chief executive officer, dreamer-in-charge and chief spellbinder of the Atlanta Committee for the Olympic Games (ACOG, which locals pronounce AY-cog), Payne now refers to the Olympics as "the greatest peacetime event in the 20th century." Thus the warlike nature of recent months has weighed heavily on him. "I have been trying to be a diplomat, and that has been extremely difficult for me," he says. "My tongue has gotten shorter from biting it off so many times."

The issue that has shortened Payne's tongue most is the difficulty ACOG is having raising the $1.4 billion the Games will cost—$900 million in operating expenses and $500 million for the construction of sports facilities and the Olympic Village. The best estimates are that the committee is running two thirds behind schedule in its cash flow, and in January 1992 it had to turn to a $300 million line of bank credit to make ends meet. Michael Lomax, chairman of the Fulton County commission and a member of the Metropolitan Atlanta Olympic Games Authority, which functions as a public watchdog over the privately organized ACOG, says, "The last financial report was not a good one. ACOG is not hitting its goals. Its members said they were not expecting anything from the government, so we want to make sure they are not overspending based on revenue they are not producing. They have a very expensive executive payroll, and that was based upon the enthusiasm we initially had about the Games."

Included in that very expensive payroll is Payne's annual salary of $530,000, a figure that was announced by ACOG last April and denounced immediately by some local critics. However, many Atlantans forgave Payne his fat salary because from 1987 through '91 he pursued his—their —Olympic dream without any pay and wound up with more than $1 million in personal debt. Also, Payne supporters point out that the salary is not out of line for a CEO of an average Fortune 500 company. A.D. Frazier, a former Atlanta and Chicago banker who is ACOG's chief operating officer, No. 2 behind Payne, is paid $375,000 a year, about half of what he earned at the bank. "What we have here at ACOG," Frazier says, "is an operation the size of a Fortune 500 firm that is founded, organized and operated for six years and six years only, and then goes out of business after '96."

True, but the question of the moment is: Can ACOG raise the money it needs to stay in business for those years? The committee long ago declared that it planned to pay its bills by taking in at least $550 million from the sale of U.S. and foreign television rights, another $400 million or so from the sale of merchandising licenses and commemorative coins and tickets, and another $500 million from the sale of corporate sponsorships. The TV negotiations with U.S. networks should take place in late spring or early summer, and if the economy continues to improve, TV could produce revenue close to ACOG's predictions. Sales of coins, licenses and tickets usually produce a dependable income, but it doesn't start flowing in until closer to the beginning of the Games. So the immediate question about ACOG's finances lies in the sale of $500 million worth of corporate sponsorships.

Originally the hope was to bring in 10 national "Partners" in different commercial categories such as automobiles, fast food, telecommunications, insurance and beer. In the fall of 1991 Payne promised to have the national Partners signed and sealed by the end of 1992. At the time, he declared boldly, "Only the big boys need apply." He meant the very big boys. The price of a partnership was $40 million. By contrast, the Los Angeles Olympic Organizing Committee, which invented the corporate-sponsorship gimmick for the '84 Games, charged only $4 million apiece for its 30 major sponsorships, and eight corporations paid at least $23 million each to be joint partners with the Barcelona Games organizers. The IOC now charges $40 million apiece for its dozen worldwide TOP (The Olympic Program) affiliations, but those sponsorships include marketing rights in virtually every country that has a national Olympic committee.

For $40 million, each national Partner is affiliated with not only the Atlanta Games but also the U.S. Olympic Committee (USOC). Each national Partner receives exclusivity in its market category, so that, for example, only one commercial bank—NationsBank—will sponsor the U.S. Olympic Team at the '94 Winter Games in Lillehammer and in Atlanta in '96. Among other exclusive privileges, each Partner with a capital P may use the Atlanta Games' logo and the Olympic rings in its advertising. It will also have access to 400 of the best hotel rooms, VIP credentials, chauffeured cars, tickets, etc., at the '96 Olympics.

Is this a good deal? So far four corporations—NationsBank, Sara Lee, Home Depot and IBM—think it is and have signed individually tailored deals with ACOG. For instance, IBM will provide $40 million worth of equipment and services—but no cash—for its partnership. Both Payne and Harvey Schiller, executive director of the USOC, express optimism about selling more national partnerships—soon. Says Schiller, "The marketplace continues to improve. One problem we had was that we were prevented from selling these partnerships until after the Games in Barcelona, due to an IOC restriction."

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