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All hands on deck

Finance Ministry kicks in funding for World Ski Championships to avert 'a big shame'

By František Bouc
Staff Writer, The Prague Post
December 17th, 2008 issue

ISIFA
Neumannová's organizing committee for the World Ski Championship faces the challenge of garnering money for the acclaimed event.
The Cabinet approved an emergency subsidy to the organizers of the World Ski Championship to be held in Liberec Feb. 18–March 1.
Finance Minister Miroslav Kalousek announced that the government would pitch in an additional 189 million Kč ($9.5 million) to the championship organizers in order to avert the event’s collapse.
“The Cabinet obviously did not want to give any more money to the championship, but circumstances forced us to act otherwise. ... The choice was to pay an additional subsidy or risk the event ending in fiasco and international disgrace to the country,” Kalousek said.
Education, Youth and Sports Minister Ondřej Liška confirmed that, without the additional subsidy, the championship would be jeopardized. “It was about averting a big shame,” he said.
So far, the government has paid some 1.5 billion Kč to the Liberec championship organizers. The overall budget of arguably the biggest sporting event in the country next year should amount to more than 2 billion Kč. Apart from the Cabinet, Liberec Town Hall will pay 380 million Kč, and the Liberec region will add 146 million Kč. Meanwhile, the International Ski Federation (FIS) is set to contribute 11 million Swiss francs (182.3 million Kč), some 150 million Kč is expected to be raised from selling marketing rights, and ticket sales are estimated to bring in 130 million Kč.
Ondřej Gabriel, spokesman for the Education, Youth and Sports Ministry, said the global financial crisis has had major repercussions on the championship’s organization.
“Corporations’ interest in supporting the event has not faded, but the credit crunch means they cannot spend so much money on sponsorship,” he said, adding that the international economic downturn could also affect negotiations for TV rights.
The organizing committee’s spokesman, Zdeněk Soudný, said that revenues from advanced ticket sales trailed expectations.
“We expected to clear some 120 million Kč in admissions, but we’ve so far sold tickets worth merely 20 million Kč,” Soudný said. He speculated that the financial crisis was also a factor in decreased public interest.
“It seems that people are still waiting to see what happens,” Soudný said.
Organizational costs are spiking, arguably because of greed by accommodation providers in Liberec. Some hotels are charging 7,500 Kč per night. However, FIS requires that the maximum accommodation price for the event’s officials and VIP guests cannot exceed 120 euros ($156/3,100 Kč). As a result, organizers will be forced to cover the costs of international officials.
“Part of the 189 million Kč subsidy will be used for this purpose,” Soudný confirmed. He added that even some local politicians are apparently tempted to capitalize on the ski championship.
“A member of [Liberec] Town Hall approached me with an offer that she could rent her apartment in Liberec during the championship and would move to her relatives in the meantime. ... But her price was exaggerated,” Soudný said.
Snow politics
Although Soudný tends to attribute the troubles with organizing the championship mostly to the global financial crisis, saying “the crisis forced out changes in the championship’s budget,” preparation for the event has long created turmoil.
In the summer of 2007, former Education, Youth and Sports Minister Dana Kuchtová replaced then-head of the championship’s organizing committee, Roman Kumpošt, with retired champion skier Kateřina Neumannová. Kuchtová claimed that nontransparent financial transactions made by Kumpošt were at the root of her ruling. Kumpošt denied any wrongdoing, and an independent audit never found any controversial financial transactions.
However, Neumannová’s appointment did open a pipeline from the state budget that had dried up during Kumpošt’s leadership. Ironically, the FIS declared in the winter of 2006 that the Liberec event was to be the best-prepared world championships of all time. But mounting pressure from the government and Kumpošt’s team brought about major delays in the construction of the championship’s facilities. Those delays have left some still questioning whether officials are up to the task of preparing the site in time.
“The situation is critical, and fast progress is needed in order to make the championship happen,” Czech Ski Federation President Lukáš Sobotka said in the fall of 2007.
Soon after Neumannová’s appointment, the government paid a 700 million Kč subsidy to the championship’s organizers and gave Neumannová its all-important political backing.
Prime Minister Mirek Topolánek said last summer that he was ready to support the organizers.
“If anyone wanted to harm the championship, he would first have to fight me off,” Topolánek said.

František Bouc can be reached at fbouc@praguepost.com


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