SB 1465: Public contracts: 2024 Olympic Games and Paralympic Games.
- Session Year: 2015-2016
- House: Senate
- Latest Version Date: 2016-09-29
Existing law provides specified requirements in awarding certain public contracts.
This bill would authorize the Governor to execute games support contracts, not to exceed a specified amount, in connection with the site selection process for the City of Los Angeles to become the host for the 2024 Olympic Games and Paralympic Games, that accept financial liability to provide the state security for amounts owed by the Organizing Committee for the Olympic Games (OCOG), as specified, and for any financial deficit accruing to the OCOG as a result of the hosting of the games by the endorsing municipality, as defined.
This bill would make legislative findings and declarations that, among other things, the endorsing municipality has developed a self-sufficient bid for financing the games.
Existing law provides specified requirements in awarding certain public contracts.
This bill would authorize the Governor to execute games support contracts, not to exceed a specified amount, in connection with the site selection process for the City of Los Angeles to become the host for the 2024 Olympic Games and Paralympic Games, that accept financial liability to provide the state security for amounts owed by the Organizing Committee for the Olympic Games (OCOG), as specified, and for any financial deficit accruing to the OCOG as a result of the hosting of the games by the endorsing municipality, as defined.
This bill would make legislative findings and declarations that, among other things, the endorsing municipality has developed a self-sufficient bid for financing the games.
Existing law provides specified requirements in awarding certain public contracts.
This bill would authorize the Governor to sign agreements with the International Olympic and Paralympic Committees, as part of execute games support contracts, not to exceed a specified amount, in connection with the site selection process for the City of Los Angeles to become the host for the 2024 Olympic Games and Paralympic Games. Games, that accept financial liability to provide the state security for amounts owed by the Organizing Committee for the Olympic Games (OCOG), as specified, and for any financial deficit accruing to the OCOG as a result of the hosting of the games by the endorsing municipality, as defined.
This bill would make legislative findings and declarations that, among other things, the endorsing municipality, as defined, municipality has developed a self-sufficient bid for financing the games. This bill would authorize the Governor to enter into an agreement for the state to be jointly liable, not to exceed a specified amount, with the Organizing Committee for the Olympic Games (OCOG), as specified, for obligations of the OCOG, and for any financial deficit relating to the games, as provided.
Existing law provides specified requirements in awarding certain public contracts.
This bill would authorize the Governor to sign agreements with the International Olympic and Paralympic Committees, as part of the site selection process for the City of Los Angeles to become the host for the 2024 Olympic Games and Paralympic Games.
This bill would make legislative findings and declarations that, among other things, the endorsing municipality, as defined, has developed a self-sufficient bid for financing the games. This bill would authorize the Governor to enter into an agreement for the state to be jointly liable, not to exceed a specified amount, with the Organizing Committee for the Olympic Games (OCOG), as specified, for obligations of the OCOG, and for any financial deficit relating to the games, as provided.
Existing law provides specified requirements in awarding certain public contracts.
This bill would authorize the Governor to sign agreements with the International Olympic and Paralympic Committee, Committees, as part of the site selection process for the City of Los Angeles to become the host for the 2024 Olympic Games and Paralympic Games.
This bill would make legislative findings and declarations that, among other things, the endorsing municipality, as defined, has developed a self-sufficient bid for financing the games. This bill would authorize the Governor to enter into an agreement for the state to be jointly liable, not to exceed a specified amount, with the Organizing Committee for the Olympic Games (OCOG), as specified, for obligations of the OCOG, and for any financial deficit relating to the games, as provided.
Existing law provides specified requirements in awarding certain public contracts.
This bill would authorize the Governor to sign agreements with the International Olympic and Paralympic Committee, as part of the site selection process for the City of Los Angeles to become the host for the 2024 Olympic Games and Paralympic Games.
This bill would make legislative findings and declarations that, among other things, the endorsing municipality, as defined, has developed a self-sufficient bid for financing the games. This bill would authorize the Governor to enter into an agreement for the state to be jointly liable, not to exceed a specified amount, with the Organizing Committee for the Olympic Games (OCOG), as specified, for obligations of the OCOG, and for any financial deficit relating to the games, as provided.
This bill would declare that it is to take effect immediately as an urgency statute.
Existing law provides specified requirements in awarding certain public contracts.
This bill would authorize the Governor to sign agreements with the International Olympic and Paralympic Committee, as part of the site selection process for the City of Los Angeles to become the host for the 2024 Olympic Games and Paralympic Games.
This bill would make legislative findings and declarations that, among other things, the endorsing municipality, as defined, has developed a self-sufficient bid for financing the games. This bill would authorize the Governor to enter into an agreement for the state to be jointly liable, not to exceed a specified amount, with the Organizing Committee for the Olympic Games (OCOG), as specified, for obligations of the OCOG, and for any financial deficit relating to the games, as provided.
This bill would declare that it is to take effect immediately as an urgency statute.
This act is known, and may be cited, as the 2024 Olympic Games and Paralympic Games Act.
SEC. 2.For purposes of this act:
(a)Endorsing municipality means the City of Los Angeles, which has authorized a bid by the Organizing Committee for the Olympic Games (OCOG) for selection of the municipality as the site of the games.
(b)Games means the 2024 Olympic and Paralympic Games.
(c)Games support contract means a joinder agreement or a similar contract executed by the Governor and containing terms permitted or required by this act.
(d)Joinder agreement means an agreement in connection with the selection of a site in this state for the location of the games.
(e)OCOG means a nonprofit corporation, or its successor in interest, that:
(1)Has been authorized by the endorsing municipality to pursue an application and bid on the endorsing municipalitys behalf to a site selection organization for selection as the site for the games.
(2)With the authorization of the endorsing municipality, has executed a bid committee agreement with the United States Olympic Committee regarding a bid and the bid process to host the games.
(f)Site selection organization means the International Olympic Committee, the International Paralympic Committee, or both, as applicable.
(g)State security means the financial obligation, not to exceed two hundred fifty million dollars ($250,000,000), undertaken by the state pursuant to a games support contract executed by the Governor in accordance with this act.
SEC. 3.The Legislature finds and declares all of the following:
(a)The purpose of this act is to provide assurances required by a site selection organization that will select a city to host the games.
(b)Hosting the games in California is expected to generate billions of dollars for the states economy. The OCOG, on behalf of the endorsing municipality, has developed a self-sufficient bid and plan for financing the games that is based on realistic and conservative revenue scenarios and has budgeted sufficient funds to reimburse local and regional governments for services provided during the games.
(c)The endorsing municipality plans to host a sustainable and environmentally responsible games, has committed to sports and recreational opportunities for young people throughout each area by planning to generate a legacy for youth programs and other sports purposes in this state with excess revenues from the games, and plans to develop and implement a unique and broad-based, cultural program.
(d)The endorsing municipality will involve athletes, sports professionals, environmentalists, business and financial experts, nonprofit organizations, youth service leaders, and individuals who represent the entire diversity of the endorsing municipalitys state in its bid.
(e)The endorsing municipality expects that if it is chosen as the host city, and once the games have concluded, there will be net revenue exceeding expenses that can be devoted to legacy programs for youth and citizens of California.
SEC. 4.(a)The Governor may execute games support contracts on behalf of the state that, in accordance with law and subject to the requirements and limitations set forth in Sections 5, 6, and 7 of this act, accept financial liability, funded solely by means of the funding mechanism established by Sections 5, 6, and 7 of this act, and in an aggregate amount that under no circumstance shall exceed two hundred fifty million dollars ($250,000,000), to provide the state security for the following:
(1)Amounts owed by the OCOG to a site selection organization for claims by third parties arising out of or relating to the games.
(2)Any financial deficit accruing to the OCOG as a result of the hosting of the games by the endorsing municipality. Any liability for an amount in excess of the state security of two hundred fifty million dollars ($250,000,000) shall be the responsibility of parties other than the state.
(b)The games support contracts may contain additional provisions that the Governor requires in order to carry out the purposes of this act.
SEC. 5.(a)There is hereby established in the State Treasury a special fund to be known as the Olympic Games Trust Fund.
(b)The state may choose to fund the Olympic Games Trust Fund in any manner it considers appropriate and at the time or times the state determines necessary. It is the intent of the Legislature that the funding mechanism for the fund shall be determined on or about the time of the selection of the endorsing municipality as the host city by the site selection organizations.
(c)The funds in the trust fund may be used only for the sole purpose of fulfilling the obligations of the state under a games support contract to provide the state security. Notwithstanding any other law, the Controller may use the funds in the trust fund for cashflow loans to the General Fund as provided in Sections 16310 and 16381 of the Government Code.
(d)No additional state funds shall be deposited into the Olympic Games Trust Fund once the Director of Finance determines that the account has achieved, or is reasonably expected to otherwise accrue, the balance necessary to provide the state security pursuant to a games support contract.
(e)If the endorsing municipality is selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be maintained until the Director of Finance makes a determination that the states obligation to provide the state security under a games support contract has been satisfied and concluded, at which time the trust fund shall be terminated.
(f)If the endorsing municipality in the State of California is not selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be immediately terminated.
(g)Upon the termination of the Olympic Games Trust Fund, all sums earmarked, transferred, or contained in the fund, along with any investment earnings retained in the fund, shall immediately revert to the General Fund.
SEC. 6.(a)Any moneys deposited, transferred, or otherwise contained in the Olympic Games Trust Fund established in Section 5 shall be, upon appropriation by the Legislature, used for the sole purpose of providing the state security under a games support contract. The state security may be provided by moneys contained in the trust fund established in Section 5 of this act, or by insurance coverage, letters of credit, or other secured instruments purchased or secured by the moneys, or by any combination thereof as specified in a games support contract. In no event may the liability of the state under all games support contracts, any other agreements related to the conduct of the games, and all financial obligations of the state otherwise arising under this act, exceed two hundred fifty million dollars ($250,000,000) in the aggregate.
(b)Obligations authorized by this act shall be payable solely from the Olympic Games Trust Fund. Neither the full faith and credit nor the taxing power of the state are or shall be pledged for any payment under any obligation authorized by this act.
SEC. 7.The state shall, subject to the limitations set forth in Sections 5 and 6 of this act and the games support contract, be the payer of last resort with regard to the use of the state security. The state security may not be accessed to cover any obligation of the state under a games support contract until after all of the following occur:
(a)The security provided by the OCOG is fully expended and exhausted.
(b)The endorsing municipality has expended and exhausted at least two hundred fifty million dollars ($250,000,000) of the endorsing municipalitys security.
(c)Any security provided by any other person or entity is fully expended and exhausted.
(d)The limits of available insurance policies have been fully expended and exhausted.
(e)The OCOG has exhausted all efforts to seek payment from all third parties owing moneys or otherwise liable to the OCOG.
SEC. 8.The OCOG shall list the state as an additional insured on any policy of insurance purchased by the OCOG to be in effect in connection with the preparation for and conduct of the games.
SEC. 9.The OCOG shall not engage in any conduct that reflects unfavorably upon this state, the endorsing municipality, or the games, or that is contrary to law or to the rules and regulations of the United States Olympic Committee and the International Olympic and Paralympic Committees.
This act is known, and may be cited, as the 2024 Olympic Games and Paralympic Games Act.
SEC. 2.For purposes of this act:
(a)Endorsing municipality means the City of Los Angeles, which has authorized a bid by the Organizing Committee for the Olympic Games (OCOG) for selection of the municipality as the site of the games.
(b)Games means the 2024 Olympic and Paralympic Games.
(c)Games support contract means a joinder agreement or a similar contract executed by the Governor and containing terms permitted or required by this act.
(d)Joinder agreement means an agreement in connection with the selection of a site in this state for the location of the games.
(e)OCOG means a nonprofit corporation, or its successor in interest, that:
(1)Has been authorized by the endorsing municipality to pursue an application and bid on the endorsing municipalitys behalf to a site selection organization for selection as the site for the games.
(2)With the authorization of the endorsing municipality, has executed a bid committee agreement with the United States Olympic Committee regarding a bid and the bid process to host the games.
(f)Site selection organization means the International Olympic Committee, the International Paralympic Committee, or both, as applicable.
(g)State security means the financial obligation, not to exceed two hundred fifty million dollars ($250,000,000), undertaken by the state pursuant to a games support contract executed by the Governor in accordance with this act.
SEC. 3.The Legislature finds and declares all of the following:
(a)The purpose of this act is to provide assurances required by a site selection organization that will select a city to host the games.
(b)Hosting the games in California is expected to generate billions of dollars for the states economy. The OCOG, on behalf of the endorsing municipality, has developed a self-sufficient bid and plan for financing the games that is based on realistic and conservative revenue scenarios and has budgeted sufficient funds to reimburse local and regional governments for services provided during the games.
(c)The endorsing municipality plans to host a sustainable and environmentally responsible games, has committed to sports and recreational opportunities for young people throughout each area by planning to generate a legacy for youth programs and other sports purposes in this state with excess revenues from the games, and plans to develop and implement a unique and broad-based, cultural program.
(d)The endorsing municipality will involve athletes, sports professionals, environmentalists, business and financial experts, nonprofit organizations, youth service leaders, and individuals who represent the entire diversity of the endorsing municipalitys state in its bid.
(e)The endorsing municipality expects that if it is chosen as the host city, and once the games have concluded, there will be net revenue exceeding expenses that can be devoted to legacy programs for youth and citizens of California.
SEC. 4.(a)The Governor may execute games support contracts on behalf of the state that, in accordance with law and subject to the requirements and limitations set forth in Sections 5, 6, and 7 of this act, accept financial liability, funded solely by means of the funding mechanism established by Sections 5, 6, and 7 of this act, and in an aggregate amount that under no circumstance shall exceed two hundred fifty million dollars ($250,000,000), to provide the state security for the following:
(1)Amounts owed by the OCOG to a site selection organization for claims by third parties arising out of or relating to the games.
(2)Any financial deficit accruing to the OCOG as a result of the hosting of the games by the endorsing municipality. Any liability for an amount in excess of the state security of two hundred fifty million dollars ($250,000,000) shall be the responsibility of parties other than the state.
(b)The games support contracts may contain additional provisions that the Governor requires in order to carry out the purposes of this act.
SEC. 5.(a)There is hereby established in the State Treasury a special fund to be known as the Olympic Games Trust Fund.
(b)The state may choose to fund the Olympic Games Trust Fund in any manner it considers appropriate and at the time or times the state determines necessary. It is the intent of the Legislature that the funding mechanism for the fund shall be determined on or about the time of the selection of the endorsing municipality as the host city by the site selection organizations.
(c)The funds in the trust fund may be used only for the sole purpose of fulfilling the obligations of the state under a games support contract to provide the state security. Notwithstanding any other law, the Controller may use the funds in the trust fund for cashflow loans to the General Fund as provided in Sections 16310 and 16381 of the Government Code.
(d)No additional state funds shall be deposited into the Olympic Games Trust Fund once the Director of Finance determines that the account has achieved, or is reasonably expected to otherwise accrue, the balance necessary to provide the state security pursuant to a games support contract.
(e)If the endorsing municipality is selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be maintained until the Director of Finance makes a determination that the states obligation to provide the state security under a games support contract has been satisfied and concluded, at which time the trust fund shall be terminated.
(f)If the endorsing municipality in the State of California is not selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be immediately terminated.
(g)Upon the termination of the Olympic Games Trust Fund, all sums earmarked, transferred, or contained in the fund, along with any investment earnings retained in the fund, shall immediately revert to the General Fund.
SEC. 6.(a)Any moneys deposited, transferred, or otherwise contained in the Olympic Games Trust Fund established in Section 5 shall be, upon appropriation by the Legislature, used for the sole purpose of providing the state security under a games support contract. The state security may be provided by moneys contained in the trust fund established in Section 5 of this act, or by insurance coverage, letters of credit, or other secured instruments purchased or secured by the moneys, or by any combination thereof as specified in a games support contract. In no event may the liability of the state under all games support contracts, any other agreements related to the conduct of the games, and all financial obligations of the state otherwise arising under this act, exceed two hundred fifty million dollars ($250,000,000) in the aggregate.
(b)Obligations authorized by this act shall be payable solely from the Olympic Games Trust Fund. Neither the full faith and credit nor the taxing power of the state are or shall be pledged for any payment under any obligation authorized by this act.
SEC. 7.The state shall, subject to the limitations set forth in Sections 5 and 6 of this act and the games support contract, be the payer of last resort with regard to the use of the state security. The state security may not be accessed to cover any obligation of the state under a games support contract until after all of the following occur:
(a)The security provided by the OCOG is fully expended and exhausted.
(b)The endorsing municipality has expended and exhausted at least two hundred fifty million dollars ($250,000,000) of the endorsing municipalitys security.
(c)Any security provided by any other person or entity is fully expended and exhausted.
(d)The limits of available insurance policies have been fully expended and exhausted.
(e)The OCOG has exhausted all efforts to seek payment from all third parties owing moneys or otherwise liable to the OCOG.
SEC. 8.The OCOG shall list the state as an additional insured on any policy of insurance purchased by the OCOG to be in effect in connection with the preparation for and conduct of the games.
SEC. 9.The OCOG shall not engage in any conduct that reflects unfavorably upon this state, the endorsing municipality, or the games, or that is contrary to law or to the rules and regulations of the United States Olympic Committee and the International Olympic and Paralympic Committees.
This act is known, and may be cited, as the 2024 Olympic Games and Paralympic Games Act.
SEC. 2.For purposes of this act:
(a)Endorsing municipality means the City of Los Angeles, which has authorized a bid by the Organizing Committee for the Olympic Games (OCOG) for selection of the municipality as the site of the games.
(b)Games means the 2024 Olympic and Paralympic Games.
(c)Games support contract means a joinder agreement or a similar contract executed by the Governor and containing terms permitted or required by this act.
(d)Joinder agreement means an agreement entered into by the Governor, on behalf of the state, and the International Olympic Committee and the International Paralympic Committee setting out representations and assurances by the state in connection with the selection of a site in this state for the location of the games.
(e)OCOG means a nonprofit corporation, or its successor in interest, that:
(1)Has been authorized by the endorsing municipality to pursue an application and bid on the endorsing municipalitys behalf to a site selection organization for selection as the site for the games.
(2)With the authorization of the endorsing municipality, has executed a bid committee agreement with the United States Olympic Committee regarding a bid and the bid process to host the games.
(f)Site selection organization means the International Olympic Committee, the International Paralympic Committee, or both, as applicable.
(g)State security means the financial obligation, not to exceed two hundred fifty million dollars ($250,000,000), undertaken by the state pursuant to a games support contract executed by the Governor in accordance with this act.
SEC. 3.The Legislature finds and declares all of the following:
(a)The purpose of this act is to provide assurances required by a site selection organization that will select a city to host the games.
(b)Hosting the games in California is expected to generate billions of dollars for the states economy. The OCOG, on behalf of the endorsing municipality, has developed a self-sufficient bid and plan for financing the games that is based on realistic and conservative revenue scenarios and has budgeted sufficient funds to reimburse local and regional governments for services provided during the games.
(c)The endorsing municipality plans to host a sustainable and environmentally responsible games, has committed to sports and recreational opportunities for young people throughout each area by planning to generate a legacy for youth programs and other sports purposes in this state with excess revenues from the games, and plans to develop and implement a unique and broad-based, cultural program.
(d)The endorsing municipality will involve athletes, sports professionals, environmentalists, business and financial experts, nonprofit organizations, youth service leaders, and individuals who represent the entire diversity of the endorsing municipalitys state in its bid.
(e)The endorsing municipality expects that if it is chosen as the host city, and once the games have concluded, there will be net revenue exceeding expenses that can be devoted to legacy programs for youth and citizens of California.
SEC. 4.(a)The Governor may agree in a joinder agreement that the state shall, execute games support contracts on behalf of the state that, in accordance with law and subject to the requirements and limitations set forth in Sections 5, 6, and 7 of this act, do the following: accept financial liability, funded solely by means of the funding mechanism established by Sections 5, 6, and 7 of this act, and in an aggregate amount that under no circumstance shall exceed two hundred fifty million dollars ($250,000,000), to provide the state security for the following:
(a)Provide or cause to be provided any or all of the state government funding, facilities, and other resources specified in the OCOGs bid to host the games.
(b)Accept liability, solely by means of the funding mechanism established by Sections 5, 6, and 7 of this act, for both of the following:
(1)Obligations of Amounts owed by the OCOG to a site selection organization, including obligations indemnifying the site selection organization against organization for claims of and liabilities to by third parties arising out of or relating to the games.
(2)Any financial deficit relating accruing to the OCOG or the games, not to exceed the amount appropriated to the Olympic Games Trust Fund established in Section 5 of this act. as a result of the hosting of the games by the endorsing municipality. Any liability for an amount in excess of that amount the state security of two hundred fifty million dollars ($250,000,000) shall be the responsibility of the OCOG. parties other than the state.
(c)Acknowledge that the OCOG will be bound by a series of agreements with the site selection organization as set forth in the joinder agreement.
(d)The Governor shall execute a joinder agreement, provided that the parties conform to this act.
(e)A
(b)The games support contract contracts may contain additional provisions that the Governor requires in order to carry out the purposes of this act.
SEC. 5.(a)There is hereby established in the State Treasury a special fund to be known as the Olympic Games Trust Fund.
(b)The state may choose to fund the Olympic Games Trust Fund in any manner it considers appropriate and at the time or times the state determines necessary. It is the intent of the Legislature that the funding mechanism for the fund shall be determined on or about the time of the selection of the endorsing municipality as the host city by the site selection organizations.
(c)The funds in the trust fund may be used only for the sole purpose of fulfilling the obligations of the state under a games support contract to provide adequate security as described in Section 6. the state security. Notwithstanding any other law, the Controller may use the funds in the trust fund for cashflow loans to the General Fund as provided in Sections 16310 and 16381 of the Government Code.
(d)No additional state funds shall be deposited into the Olympic Games Trust Fund once the Director of Finance determines that the account has achieved, or is reasonably expected to otherwise accrue, a sufficient balance to provide adequate security, acceptable to the site selection organization, to demonstrate the states ability to fulfill its obligations under a games support contract, or any other agreement, to indemnify and insure up to two hundred fifty million dollars ($250,000,000) of any net financial deficit and general liability resulting from the conduct of the games. the balance necessary to provide the state security pursuant to a games support contract.
(e)If the endorsing municipality is selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be maintained until a determination by the Department of the Director of Finance is made makes a determination that the states obligations obligation to provide the state security under a games support contract, or any other agreement, to indemnify and insure against any net financial deficit and general liability resulting from the conduct of the games are contract has been satisfied and concluded, at which time the trust fund shall be terminated. If
(f)If the endorsing municipality in the State of California is not selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be immediately terminated.
(f)
(g)Upon the termination of the Olympic Games Trust Fund, all sums earmarked, transferred, or contained in the fund, along with any investment earnings retained in the fund, shall immediately revert to the General Fund.
SEC. 6.(a)Any moneys deposited, transferred, or otherwise contained in the Olympic Games Trust Fund established in Section 5 shall be, upon appropriation by the Legislature, used for the sole purpose of obtaining adequate security, acceptable to the site selection organization, to demonstrate the states ability to fulfill its obligations under a games support contract to indemnify and insure up to two hundred fifty million dollars ($250,000,000) of any general liability and net financial deficit resulting from the conduct of the games. providing the state security under a games support contract. The state security may be provided by moneys contained in the trust fund as provided established in Section 5 of this act, or by insurance coverage, letters of credit, or other acceptable secured instruments purchased or secured by the moneys, or by any combination thereof. thereof as specified in a games support contract. In no event may the liability of the state under all games support contracts, any other agreements related to the conduct of the games, and all financial obligations of the state otherwise arising under this act, exceed two hundred fifty million dollars ($250,000,000) in the aggregate.
(b)Obligations authorized by this act shall be payable solely from the Olympic Games Trust Fund. Neither the full faith and credit nor the taxing power of the state are or shall be pledged for any payment under any obligation authorized by this act.
SEC. 7.The state shall, along with the endorsing municipality and subject to the limitations set forth in Sections 5 and 6 of this act, act and the games support contract, be the payer of last resort with regard to any net financial deficit. the use of the state security. The state security provided pursuant to this act may not be accessed to cover any general liability and net financial deficit indemnified by the state under the obligation of the state under a games support contract until after all of the following occur:
(a)The security provided by the OCOG is fully expended and exhausted.
(b)The endorsing municipality has expended and exhausted at least two hundred fifty million dollars ($250,000,000) of the endorsing municipalitys security.
(b)
(c)Any security provided by any other person or entity is fully expended and exhausted.
(c)
(d)The limits of available insurance policies covering any general liability obligation and the net financial deficit, or any expense or liability used in determining the net financial deficit,have been fully expended and exhausted.
(d)Payment has been sought by the OCOG
(e)The OCOG has exhausted all efforts to seek payment from all third parties owing moneys or otherwise liable to the OCOG.
(e)The endorsing municipality has expended and exhausted two hundred fifty million dollars ($250,000,000) of the endorsing municipalitys security deposit.
SEC. 8.The OCOG shall list the state as an additional insured on any policy of insurance purchased by the OCOG to be in effect in connection with the preparation for and conduct of the games.
SEC. 9.The OCOG shall not engage in any conduct that reflects unfavorably upon this state, the endorsing municipality, or the games, or that is contrary to law or to the rules and regulations of the United States Olympic Committee and the International Olympic and Paralympic Committees.
This act is known, and may be cited, as the 2024 Olympic Games and Paralympic Games Act.
SEC. 2.For purposes of this act:
(a)Endorsing municipality means the City of Los Angeles, which has authorized a bid by the Organizing Committee for the Olympic Games (OCOG) for selection of the municipality as the site of the games.
(b)Games means the 2024 Olympic and Paralympic Games.
(c)Games support contract means a joinder agreement or a similar contract executed by the Governor and containing terms permitted or required by this act.
(d)Joinder agreement means an agreement entered into by the Governor, on behalf of the state, and the International Olympic Committee and the International Paralympic Committee setting out representations and assurances by the state in connection with the selection of a site in this state for the location of the games.
(e)OCOG means a nonprofit corporation, or its successor in interest, that:
(1)Has been authorized by the endorsing municipality to pursue an application and bid on the endorsing municipalitys behalf to a site selection organization for selection as the site for the games.
(2)With the authorization of the endorsing municipality, has executed a bid committee agreement with the United States Olympic Committee regarding a bid and the bid process to host the games.
(f)Site selection organization means the International Olympic Committee, the International Paralympic Committee, or both, as applicable.
SEC. 3.The Legislature finds and declares all of the following:
(a)The purpose of this act is to provide assurances required by a site selection organization that will select a city to host the games.
(b)Hosting the games in California is expected to generate billions of dollars for the states economy. The OCOG, on behalf of the endorsing municipality, has developed a self-sufficient bid and plan for financing the games that is based on realistic and conservative revenue scenarios and has budgeted sufficient funds to reimburse local and regional governments for services provided during the games.
(c)The endorsing municipality plans to host a sustainable and environmentally responsible games, has committed to sports and recreational opportunities for young people throughout each area by planning to generate a legacy for youth programs and other sports purposes in this state with excess revenues from the games, and plans to develop and implement a unique and broad-based, cultural program.
(d)The endorsing municipality has involved will involve athletes, sports professionals, environmentalists, business and financial experts, nonprofit organizations, youth service leaders, and individuals who represent the entire diversity of the endorsing municipalitys area state in its bid.
(e)The endorsing municipality expects that if it is chosen as the host city, and once the games have concluded, there will be net revenue exceeding expenses that can be devoted to legacy programs for youth and citizens of California.
SEC. 4.The Governor may agree in a joinder agreement that the state shall, in accordance with law and subject to Sections 5, 6, and 7 of this act, do the following:
(a)Provide or cause to be provided any or all of the state government funding, facilities, and other resources specified in the OCOGs bid to host the games.
(b)Accept liability, solely by means of the funding mechanism established by Sections 5, 6, and 7 of this act, for both of the following:
(1)Obligations of the OCOG to a site selection organization, including obligations indemnifying the site selection organization against claims of and liabilities to third parties arising out of or relating to the games.
(2)Any financial deficit relating to the OCOG or the games, not to exceed the amount appropriated to the Olympic Games Trust Fund established in Section 5 of this act. Any liability for an amount in excess of that amount shall be the responsibility of the OCOG.
(c)Acknowledge that the OCOG will be bound by a series of agreements with the site selection organization as set forth in the joinder agreement.
(d)The Governor shall execute a joinder agreement, provided that the parties conform to this act.
(e)A games support contract may contain additional provisions the Governor requires in order to carry out the purposes of this act.
SEC. 5.(a)There is hereby established in the State Treasury a special fund to be known as the Olympic Games Trust Fund.
(b)The state may choose to fund the Olympic Games Trust Fund in any manner it considers appropriate and at the time or times the state determines necessary. It is the intent of the Legislature that the funding mechanism for the fund shall be determined on or about the time of the selection of the endorsing municipality as the host city by the site selection organizations.
(c)The funds in the trust fund may be used only for the sole purpose of fulfilling the obligations of the state under a games support contract to provide adequate security as described in Section 6.
(d)No additional state funds shall be deposited into the Olympic Games Trust Fund once the Director of Finance determines that the account has achieved, or is reasonably expected to otherwise accrue, a sufficient balance to provide adequate security, acceptable to the site selection organization, to demonstrate the states ability to fulfill its obligations under a games support contract, or any other agreement, to indemnify and insure up to two hundred fifty million dollars ($250,000,000) of any net financial deficit and general liability resulting from the conduct of the games.
(e)If the endorsing municipality is selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be maintained until a determination by the Department of Finance is made that the states obligations under a games support contract, or any other agreement, to indemnify and insure against any net financial deficit and general liability resulting from the conduct of the games are satisfied and concluded, at which time the trust fund shall be terminated. If the endorsing municipality in the State of California is not selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be immediately terminated.
(f)Upon the termination of the Olympic Games Trust Fund, all sums earmarked, transferred, or contained in the fund, along with any investment earnings retained in the fund, shall immediately revert to the General Fund.
SEC. 6.(a)Any moneys deposited, transferred, or otherwise contained in the Olympic Games Trust Fund established in Section 5 shall be, upon appropriation by the Legislature, used for the sole purpose of obtaining adequate security, acceptable to the site selection organization, to demonstrate the states ability to fulfill its obligations under a games support contract to indemnify and insure up to two hundred fifty million dollars ($250,000,000) of any general liability and net financial deficit resulting from the conduct of the games. The security may be provided by moneys contained in the trust fund as provided in Section 5 of this act, or by insurance coverage, letters of credit, or other acceptable secured instruments purchased or secured by the moneys, or by any combination thereof. In no event may the liability of the state under all games support contracts, any other agreements related to the conduct of the games, and all financial obligations of the state otherwise arising under this act, exceed two hundred fifty million dollars ($250,000,000) in the aggregate.
(b)Obligations authorized by this act shall be payable solely from the Olympic Games Trust Fund. Neither the full faith and credit nor the taxing power of the state are or shall be pledged for any payment under any obligation authorized by this act.
SEC. 7.The state shall, along with the endorsing municipality and subject to the limitations set forth in Sections 5 and 6 of this act, be the payer of last resort with regard to any net financial deficit. The security provided pursuant to this act may not be accessed to cover any general liability and net financial deficit indemnified by the state under the games support contract until after all of the following occur:
(a)The security provided by the OCOG is fully expended and exhausted.
(b)Any security provided by any other person or entity is fully expended and exhausted.
(c)The limits of available insurance policies covering any general liability obligation and the net financial deficit, or any expense or liability used in determining the net financial deficit, have been fully expended and exhausted.
(d)Payment has been sought by the OCOG from all third parties owing moneys or otherwise liable to the OCOG.
(e)The endorsing municipality has expended and exhausted two hundred fifty million dollars ($250,000,000) of the endorsing municipalitys security deposit.
SEC. 8.The OCOG shall list the state as an additional insured on any policy of insurance purchased by the OCOG to be in effect in connection with the preparation for and conduct of the games.
SEC. 9.The OCOG shall not engage in any conduct that reflects unfavorably upon this state, the endorsing municipality, or the games, or that is contrary to law or to the rules and regulations of the United States Olympic Committee and the International Olympic and Paralympic Committees.
This act is known, and may be cited, as the 2024 Olympic Games and Paralympic Games Act.
SEC. 2.For purposes of this act:
(a)Endorsing municipality means the City of Los Angeles, which has authorized a bid by the Organizing Committee for the Olympic Games (OCOG) for selection of the municipality as the site of the games.
(b)Games means the 2024 Olympic and Paralympic Games.
(c)Games support contract means a joinder agreement or a similar contract executed by the Governor and containing terms permitted or required by this act.
(d)Joinder agreement means an agreement entered into by the Governor, on behalf of the state, and the International Olympic Committee and the International Paralympic Committee setting out representations and assurances by the state in connection with the selection of a site in this state for the location of the games.
(e)OCOG means a nonprofit corporation, or its successor in interest, that:
(1)Has been authorized by the endorsing municipality to pursue an application and bid on the endorsing municipalitys behalf to a site selection organization for selection as the site for the games.
(2)With the authorization of the endorsing municipality, has executed a bid committee agreement with the United States Olympic Committee regarding a bid and the bid process to host the games.
(f)Site selection organization means the International Olympic Committee, the International Paralympic Committee, or both, as applicable.
SEC. 3.The Legislature finds and declares all of the following:
(a)The purpose of this act is to provide assurances required by a site selection organization which that will select a city to host the games.
(b)Hosting the games in California is expected to generate billions of dollars for the states economy. The OCOG, on behalf of the endorsing municipality, has developed a self-sufficient bid and plan for financing the games that is based on realistic and conservative revenue scenarios and has budgeted sufficient funds to reimburse local and regional governments for services provided during the games.
(c)The endorsing municipality plans to host a sustainable and environmentally responsible games, has committed to sports and recreational opportunities for young people throughout each area by planning to generate a legacy for youth programs and other sports purposes in California this state with excess revenues from the games, and plans to develop and implement a unique and broad-based, cultural program.
(d)The endorsing municipality has involved athletes, sports professionals, environmentalists, business and financial experts, nonprofit organizations, youth service leaders, and individuals who represent the entire diversity of the endorsing municipalitys area in its bid.
(e)The endorsing municipality expects that if it is chosen as the host city, and once the games have concluded, there will be net revenue exceeding expenses that can be devoted to legacy programs for youth and citizens of California.
SEC. 4.The Governor may agree in a joinder agreement that the state shall, in accordance with law and subject to Sections 5, 6, and 7 of this act, do the following:
(a)Provide or cause to be provided any or all of the state government funding, facilities, and other resources specified in the OCOGs bid to host the games.
(b)Accept liability, solely by means of the funding mechanism established by Sections 5, 6, and 7 of this act, for both of the following:
(1)Obligations of the OCOG to a site selection organization, including obligations indemnifying the site selection organization against claims of and liabilities to third parties arising out of or relating to the games.
(2)Any financial deficit relating to the OCOG or the games, to not not to exceed the amount appropriated to the Olympic Games Trust Fund established in Section 5 of this act. Any liability for an amount in excess of that amount shall be the responsibility of the OCOG.
(c)Acknowledge that the OCOG will be bound by a series of agreements with the site selection organization as set forth in the joinder agreement.
(d)The Governor shall execute a joinder agreement, provided that the parties conform to this act.
(e)A games support contract may contain additional provisions the Governor requires in order to carry out the purposes of this act.
SEC. 5.(a)There is hereby established in the State Treasury a special fund to be known as the Olympic Games Trust Fund.
(b)The state may choose to fund the Olympic Games Trust Fund in any manner it considers appropriate and at the time or times the state determines necessary. It is the intent of the Legislature that the funding mechanism for the fund shall be determined on or about the time of the selection of the endorsing municipality as the host city by the site selection organizations.
(c)The funds in the trust fund may be used only for the sole purpose of fulfilling the obligations of the state under a games support contract to provide adequate security as described in Section 6.
(d)No additional state funds shall be deposited into the Olympic Games Trust Fund once the Director of Finance determines that the account has achieved, or is reasonably expected to otherwise accrue, a sufficient balance to provide adequate security, acceptable to the site selection organization, to demonstrate the states ability to fulfill its obligations under a games support contract, or any other agreement, to indemnify and insure up to two hundred fifty million dollars ($250,000,000) of any net financial deficit and general liability resulting from the conduct of the games.
(e)If the endorsing municipality is selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be maintained until a determination by the Department of Finance is made that the states obligations under a games support contract, or any other agreement, to indemnify and insure against any net financial deficit and general liability resulting from the conduct of the games are satisfied and concluded, at which time the trust fund shall be terminated. If the endorsing municipality in the State of California is not selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be immediately terminated.
(f)Upon the termination of the Olympic Games Trust Fund, all sums earmarked, transferred, or contained in the fund, along with any investment earnings retained in the fund, shall immediately revert to the General Fund.
SEC. 6.(a)Any moneys deposited, transferred, or otherwise contained in the Olympic Games Trust Fund established in Section 5 shall be, upon appropriation by the Legislature, used for the sole purpose of obtaining adequate security, acceptable to the site selection organization, to demonstrate the states ability to fulfill its obligations under a games support contract to indemnify and insure up to two hundred fifty million dollars ($250,000,000) of any general liability and net financial deficit resulting from the conduct of the games. The security may be provided by moneys contained in the trust fund as provided in Section 5 of this act, or by insurance coverage, letters of credit, or other acceptable secured instruments purchased or secured by the moneys, or by any combination thereof. In no event may the liability of the state under all games support contracts, any other agreements related to the conduct of the games, and all financial obligations of the state otherwise arising under this act, exceed two hundred fifty million dollars ($250,000,000) in the aggregate.
(b)Obligations authorized by this act shall be payable solely from the Olympic Games Trust Fund. Neither the full faith and credit nor the taxing power of the state are or shall be pledged for any payment under any obligation authorized by this act.
SEC. 7.The state shall, along with the endorsing municipality and subject to the limitations set forth in Sections 5 and 6 of this act, be the payer of last resort with regard to any net financial deficit. The security provided pursuant to this act may not be accessed to cover any general liability and net financial deficit indemnified by the state under the games support contract until after all of the following occur:
(a)The security provided by the OCOG is fully expended and exhausted.
(b)Any security provided by any other person or entity is fully expended and exhausted.
(c)The limits of available insurance policies covering any general liability obligation and the net financial deficit, or any expense or liability used in determining the net financial deficit, have been fully expended and exhausted.
(d)Payment has been sought by the OCOG from all third parties owing moneys or otherwise liable to the OCOG.
(e)The endorsing municipality has expended and exhausted two hundred fifty million dollars ($250,000,000) of the endorsing municipalitys security deposit.
SEC. 8.The OCOG shall list the state as an additional insured on any policy of insurance purchased by the OCOG to be in effect in connection with the preparation for and conduct of the games.
SEC. 9.The OCOG shall not engage in any conduct that reflects unfavorably upon this state, the endorsing municipality, or the games, or that is contrary to law or to the rules and regulations of the United States Olympic Committee and the International Olympic and Paralympic Committees.
This act is known, and may be cited as, The cited, as the 2024 Olympic Games and Paralympic Games Act.
SEC. 2.For purposes of this act:
(a)Endorsing municipality means the City of Los Angeles, which has authorized a bid by an OCOG the Organizing Committee for the Olympic Games (OCOG) for selection of the municipality as the site of the games.
(b)Games means the 2024 Olympic and Paralympic Games.
(c)Games support contract means a joinder agreement or a similar contract executed by the Governor and containing terms permitted or required by this act.
(d)Joinder agreement means an agreement entered into by the Governor, on behalf of the state, and the International Olympic Committee and the International Paralympic Committee setting out representations and assurances by the state in connection with the selection of a site in this state for the location of the games.
(e)Organizing Committee for the Olympic Games or OCOG means a nonprofit corporation, or its successor in interest, that:
(1)Has been authorized by the endorsing municipality to pursue an application and bid on the endorsing municipalitys behalf to a site selection organization for selection as the site for the games.
(2)With the authorization of the endorsing municipality, has executed a bid committee agreement with the United States Olympic Committee regarding a bid and the bid process to host the games.
(f)Site selection organization means the International Olympic Committee, the International Paralympic Committee, or both, as applicable.
SEC. 3.The Legislature finds and declares all of the following:
(a)The purpose of this act is to provide assurances required by a site selection organization which will select a city to host the games.
(b)Hosting the games in California is expected to generate billions of dollars for the states economy. The OCOG, on behalf of the endorsing municipality, has developed a self-sufficient bid and plan for financing the games that is based on realistic and conservative revenue scenarios and has budgeted sufficient funds to reimburse local and regional governments for services provided during the games.
(c)The endorsing municipality plans to host a sustainable and environmentally responsible games, has committed to sports and recreational opportunities for young people throughout each area by planning to generate a legacy for youth programs and other sports purposes in California with excess revenues from the games, and plans to develop and implement a unique and broad-based, cultural program.
(d)The endorsing municipality has involved athletes, sports professionals, environmentalists, business and financial experts, nonprofit organizations, youth service leaders, and individuals who represent the entire diversity of the endorsing municipalitys area in its bid.
(e)The endorsing municipality expects that if it is chosen as the host city, and once the games have concluded, there will be net revenue exceeding expenses that can be devoted to legacy programs for youth and citizens of California.
SEC. 4.The Governor may agree in a joinder agreement that the state shall, in accordance with law and subject to Sections 5, 6, and 7 of this act, do the following:
(a)Provide or cause to be provided any or all of the state government funding, facilities, and other resources specified in the OCOGs bid to host the games.
(b)Accept liability, solely by means of the funding mechanism established by Sections 5, 6, and 7 of this act, for both of the following:
(1)Obligations of the OCOG to a site selection organization, including obligations indemnifying the site selection organization against claims of and liabilities to third parties arising out of or relating to the games.
(2)Any financial deficit relating to the OCOG or the games, to not exceed the amount appropriated to the Olympic Games Trust Fund established in Section 5 of this act. Any liability for an amount in excess of that amount shall be the responsibility of the OCOG.
(c)Acknowledge that the OCOG will be bound by a series of agreements with the site selection organization as set forth in the joinder agreement.
(d)The Governor shall execute a joinder agreement, provided that the parties conform to this act.
(e)A games support contract may contain additional provisions the Governor requires in order to carry out the purposes of this act.
SEC. 5.(a)There is hereby established in the State Treasury a special fund to be known as the Olympic Games Trust Fund.
(b)The state may choose to fund the Olympic Games Trust Fund in any manner it considers appropriate and at the time or times the state determines necessary. It is the intent of the Legislature that the funding mechanism for the fund shall be determined on or about the time of the selection of the endorsing municipality as the host city by the site selection organizations.
(c)The funds in the trust fund may be used only for the sole purpose of fulfilling the obligations of the state under a games support contract to provide adequate security as described in Section 6.
(d)No additional state funds shall be deposited into the Olympic Games Trust Fund once the Director of Finance determines that the account has achieved, or is reasonably expected to otherwise accrue, a sufficient balance to provide adequate security, acceptable to the site selection organization, to demonstrate the states ability to fulfill its obligations under a games support contract, or any other agreement, to indemnify and insure up to two hundred fifty million dollars ($250,000,000) of any net financial deficit and general liability resulting from the conduct of the games.
(e)If the endorsing municipality is selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be maintained until a determination by the Department of Finance is made that the states obligations under a games support contract, or any other agreement, to indemnify and insure against any net financial deficit and general liability resulting from the conduct of the games are satisfied and concluded, at which time the trust fund shall be terminated. If the endorsing municipality in the State of California is not selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be immediately terminated.
(f)Upon the termination of the Olympic Games Trust Fund, all sums earmarked, transferred, or contained in the fund, along with any investment earnings retained in the fund, shall immediately revert to the General Fund.
SEC. 6.(a)Any moneys deposited, transferred, or otherwise contained in the Olympic Games Trust Fund established in Section 5 shall be, upon appropriation by the Legislature, used for the sole purpose of obtaining adequate security, acceptable to the site selection organization, to demonstrate the states ability to fulfill its obligations under a games support contract to indemnify and insure up to two hundred fifty million dollars ($250,000,000) of any general liability and net financial deficit resulting from the conduct of the games. The security may be provided by moneys contained in the trust fund as provided in Section 5 of this act, or by insurance coverage, letters of credit, or other acceptable secured instruments purchased or secured by the moneys, or by any combination thereof. In no event may the liability of the state under all games support contracts, any other agreements related to the conduct of the games, and all financial obligations of the state otherwise arising under this act, exceed two hundred fifty million dollars ($250,000,000) in the aggregate.
(b)Obligations authorized by this act shall be payable solely from the Olympic Games Trust Fund. Neither the full faith and credit nor the taxing power of the state are or may shall be pledged for any payment under any obligation authorized by this act.
SEC. 7.The state shall, along with the endorsing municipality and subject to the limitations set forth in Sections 5 and 6 of this act, be the payer of last resort with regard to any net financial deficit. The security provided pursuant to this act may not be accessed to cover any general liability and net financial deficit indemnified by the state under the games support contract until after all of the following occur:
(a)The security provided by the OCOG is fully expended and exhausted.
(b)Any security provided by any other person or entity is fully expended and exhausted.
(c)The limits of available insurance policies covering any general liability obligation and the net financial deficit, or any expense or liability used in determining the net financial deficit, have been fully expended and exhausted.
(d)Payment has been sought by the OCOG from all third parties owing moneys or otherwise liable to the OCOG.
(e)The endorsing municipality has expended and exhausted ____ dollars ($____) two hundred fifty million dollars ($250,000,000) of the endorsing municipalitys security deposit.
SEC. 8.The OCOG shall list the state as an additional insured on any policy of insurance purchased by the OCOG to be in effect in connection with the preparation for and conduct of the games.
SEC. 9.The OCOG may shall not engage in any conduct that reflects unfavorably upon this state, the endorsing municipality, or the games, or that is contrary to law or to the rules and regulations of the United States Olympic Committee and the International Olympic and Paralympic Committees.
SEC. 10.This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to meet deadlines for the bid process for the 2024 Olympic Games, it is necessary that this act go into immediate effect.
This act is known, and may be cited as, The 2024 Olympic Games and Paralympic Games Act.
SEC. 2.For purposes of this act:
(a)Endorsing municipality means the City of Los Angeles, which has authorized a bid by an OCOG for selection of the municipality as the site of the games.
(b)Games means the 2024 Olympic and Paralympic Games.
(c)Games support contract means a joinder agreement or a similar contract executed by the Governor and containing terms permitted or required by this act.
(d)Joinder agreement means an agreement entered into by the Governor, on behalf of the state, and the International Olympic Committee and the International Paralympic Committee setting out representations and assurances by the state in connection with the selection of a site in this state for the location of the games.
(e)Organizing Committee for the Olympic Games or OCOG means a nonprofit corporation, or its successor in interest, that:
(1)Has been authorized by the endorsing municipality to pursue an application and bid on the endorsing municipalitys behalf to a site selection organization for selection as the site for the games.
(2)With the authorization of the endorsing municipality, has executed a bid committee agreement with the United States Olympic Committee regarding a bid and the bid process to host the games.
(f)Site selection organization means the International Olympic Committee, the International Paralympic Committee, or both, as applicable.
SEC. 3.The Legislature finds and declares all of the following:
(a)The purpose of this act is to provide assurances required by a site selection organization which will select a city to host the games.
(b)Hosting the games in California is expected to generate billions of dollars for the states economy. The OCOG, on behalf of the endorsing municipality, has developed a self-sufficient bid and plan for financing the games that is based on realistic and conservative revenue scenarios and has budgeted sufficient funds to reimburse local and regional governments for services provided during the games.
(c)The endorsing municipality plans to host a sustainable and environmentally responsible games, has committed to sports and recreational opportunities for young people throughout each area by planning to generate a legacy for youth programs and other sports purposes in California with excess revenues from the games, and plans to develop and implement a unique and broad-based, cultural program.
(d)The endorsing municipality has involved athletes, sports professionals, environmentalists, business and financial experts, nonprofit organizations, youth service leaders, and individuals who represent the entire diversity of the endorsing municipalitys area in its bid.
(e)The endorsing municipality expects that if it is chosen as the host city, and once the games have concluded, there will be net revenue exceeding expenses that can be devoted to legacy programs for youth and citizens of California.
SEC. 4.The Governor may agree in a joinder agreement that the state shall, in accordance with law and subject to Sections 5, 6, and 7 of this act, do the following:
(a)Provide or cause to be provided any or all of the state government funding, facilities, and other resources specified in the OCOGs bid to host the games.
(b)Accept liability, solely by means of the funding mechanism established by Sections 5, 6, and 7 of this act, for both of the following:
(1)Obligations of the OCOG to a site selection organization, including obligations indemnifying the site selection organization against claims of and liabilities to third parties arising out of or relating to the games.
(2)Any financial deficit relating to the OCOG or the games, to not exceed the amount appropriated to the Olympic Games Trust Fund established in Section 5 of this act. Any liability for an amount in excess of that amount shall be the responsibility of the OCOG.
(c)Acknowledge that the OCOG will be bound by a series of agreements with the site selection organization as set forth in the joinder agreement.
(d)The Governor shall execute a joinder agreement, provided that the parties conform to this act.
(e)A games support contract may contain additional provisions the Governor requires in order to carry out the purposes of this act.
SEC. 5.(a)There is hereby established in the State Treasury a special fund to be known as the Olympic Games Trust Fund.
(b)The state may choose to fund the Olympic Games Trust Fund in any manner it considers appropriate and at the time or times the state determines necessary. It is the intent of the Legislature that the funding mechanism for the fund shall be determined on or about the time of the selection of the endorsing municipality as the host city by the site selection organizations.
(c)The funds in the trust fund may be used only for the sole purpose of fulfilling the obligations of the state under a games support contract to provide adequate security as described in Section 6.
(d)No additional state funds shall be deposited into the Olympic Games Trust Fund once the Director of Finance determines that the account has achieved, or is reasonably expected to otherwise accrue, a sufficient balance to provide adequate security, acceptable to the site selection organization, to demonstrate the states ability to fulfill its obligations under a games support contract, or any other agreement, to indemnify and insure up to two hundred fifty million dollars ($250,000,000) of any net financial deficit and general liability resulting from the conduct of the games.
(e)If the endorsing municipality is selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be maintained until a determination by the Department of Finance is made that the states obligations under a games support contract, or any other agreement, to indemnify and insure against any net financial deficit and general liability resulting from the conduct of the games are satisfied and concluded, at which time the trust fund shall be terminated. If the endorsing municipality in the State of California is not selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be immediately terminated.
(f)Upon the termination of the Olympic Games Trust Fund, all sums earmarked, transferred, or contained in the fund, along with any investment earnings retained in the fund, shall immediately revert to the General Fund.
SEC. 6.(a)Any moneys deposited, transferred, or otherwise contained in the Olympic Games Trust Fund established in Section 5 shall be, upon appropriation by the Legislature, used for the sole purpose of obtaining adequate security, acceptable to the site selection organization, to demonstrate the states ability to fulfill its obligations under a games support contract to indemnify and insure up to two hundred fifty million dollars ($250,000,000) of any general liability and net financial deficit resulting from the conduct of the games. The security may be provided by moneys contained in the trust fund as provided in Section 5 of this act, or by insurance coverage, letters of credit, or other acceptable secured instruments purchased or secured by the moneys, or by any combination thereof. In no event may the liability of the state under all games support contracts, any other agreements related to the conduct of the games, and all financial obligations of the state otherwise arising under this act, exceed two hundred fifty million dollars ($250,000,000) in the aggregate.
(b)Obligations authorized by this act shall be payable solely from the Olympic Games Trust Fund. Neither the full faith and credit nor the taxing power of the state are or may be pledged for any payment under any obligation authorized by this act.
SEC. 7.The state shall, along with the endorsing municipality and subject to the limitations set forth in Sections 5 and 6 of this act, be the payer of last resort with regard to any net financial deficit. The security provided pursuant to this act may not be accessed to cover any general liability and net financial deficit indemnified by the state under the games support contract until after all of the following occur:
(a)The security provided by the OCOG is fully expended and exhausted.
(b)Any security provided by any other person or entity is fully expended and exhausted.
(c)The limits of available insurance policies covering any general liability obligation and the net financial deficit, or any expense or liability used in determining the net financial deficit, have been fully expended and exhausted.
(d)Payment has been sought by the OCOG from all third parties owing moneys or otherwise liable to the OCOG.
(e)The endorsing municipality has expended and exhausted ____ dollars ($____) of the endorsing municipalitys security deposit.
SEC. 8.The OCOG shall list the state as an additional insured on any policy of insurance purchased by the OCOG to be in effect in connection with the preparation for and conduct of the games.
SEC. 9.The OCOG may not engage in any conduct that reflects unfavorably upon this state, the endorsing municipality, or the games, or that is contrary to law or to the rules and regulations of the United States Olympic Committee and the International Olympic and Paralympic Committees.
SEC. 10.This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are:
In order to meet deadlines for the bid process for the 2024 Olympic Games, it is necessary that this act go into immediate effect.
|
Date
|
Status
|
|---|---|
| Jun 1, 2016 | Read third time. Passed. (Ayes 35. Noes 1.) Ordered to the Assembly. |
| Sep 8, 2016 | Enrolled and presented to the Governor at 12:30 p.m. |
| Aug 31, 2016 | Assembly amendments concurred in. (Ayes 36. Noes 1.) Ordered to engrossing and enrolling. |
| Aug 31, 2016 | Assembly amendments concurred in. (Ayes 36. Noes 1. Page 5577.) Ordered to engrossing and enrolling. |
| Aug 30, 2016 | Read third time. Passed. (Ayes 71. Noes 6. Page 6473.) Ordered to the Senate. |
| Aug 30, 2016 | Read third time. Passed. Ordered to the Senate. |
| Aug 30, 2016 | In Senate. Concurrence in Assembly amendments pending. |
| Aug 16, 2016 | Read second time. Ordered to third reading. |
| Aug 15, 2016 | Read second time and amended. Ordered to second reading. |
| Aug 12, 2016 | From committee: Do pass as amended. (Ayes 19. Noes 0.) (August 11). |
| Jun 29, 2016 | June 29 set for first hearing. Placed on APPR. suspense file. |
| Jun 21, 2016 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 7. Noes 0.) (June 21). Re-referred to Com. on APPR. |
| Jun 16, 2016 | From committee with author's amendments. Read second time and amended. Re-referred to Com. on A.,E.,S.,T., & I.M. |
| Jun 9, 2016 | Referred to Com. on A.,E.,S.,T., & I.M. |
| Jun 2, 2016 | In Assembly. Read first time. Held at Desk. |
| Feb 19, 2016 | Introduced. To Com. on RLS. for assignment. To print. |
| Jun 1, 2016 | Read third time. Passed. (Ayes 35. Noes 1. Page 4110.) Ordered to the Assembly. |
| May 31, 2016 | Read second time and amended. Ordered to third reading. |
| May 27, 2016 | From committee: Do pass as amended. (Ayes 7. Noes 0.) (May 27). |
| May 27, 2016 | From committee: Do pass as amended. (Ayes 7. Noes 0. Page 4011.) (May 27). |
| May 20, 2016 | Set for hearing May 27. |
| Apr 25, 2016 | April 25 hearing: Placed on APPR. suspense file. |
| Apr 15, 2016 | Set for hearing April 25. |
| Apr 12, 2016 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 11. Noes 1.) (April 12). Re-referred to Com. on APPR. |
| Apr 12, 2016 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 11. Noes 1. Page 3494.) (April 12). Re-referred to Com. on APPR. |
| Mar 29, 2016 | From committee with author's amendments. Read second time and amended. Re-referred to Com. on G.O. |
| Mar 15, 2016 | Set for hearing April 12. |
| Mar 10, 2016 | Referred to Com. on G.O. |
| Feb 22, 2016 | Read first time. |
| Feb 22, 2016 | From printer. May be acted upon on or after March 23. |
|
Date
|
Description
|
Location
|
Votes
|
|
|---|---|---|---|---|
| Aug 31, 2016 | Unfinished Business SB1465 De León Concurrence | Senate Floor |
Passed |
|
| Aug 30, 2016 | SB 1465 De León Senate Third Reading By RENDON | Assembly Floor |
Passed |
|
| Aug 11, 2016 | Do pass as amended. | Assembly Standing Committee on Appropriations |
Passed |
|
| Jun 21, 2016 | Do pass and be re-referred to the Committee on [Appropriations] | Assembly Standing Committee on Arts, Entertainment, Sports, Tourism, and Internet Media |
Passed |
|
| Jun 1, 2016 | Senate 3rd Reading SB1465 De León | Senate Floor |
Passed |
|
| May 27, 2016 | Do pass as amended | Senate Standing Committee on Appropriations |
Passed |
|
| Apr 25, 2016 | Placed on suspense file | Senate Standing Committee on Appropriations |
Passed |
|
| Apr 12, 2016 | Do pass, but first be re-referred to the Committee on [Appropriations] | Senate Standing Committee on Governmental Organization |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
|
Organization
|
Position
|
Date
|
|---|---|---|
| Anaheim, City Of | ** Support | Aug 30, 2016 |
| Bakersfield, City Of | ** Support | Aug 30, 2016 |
| California Hotel and Lodging Association | ** Support | Aug 30, 2016 |
| California Travel Association | ** Support | Aug 30, 2016 |
| City and County of San Francisco | ** Support | Aug 30, 2016 |
| City of Fresno | ** Support | Aug 30, 2016 |
| City of Long Beach | ** Support | Aug 30, 2016 |
| City Of Oakland | ** Support | Aug 30, 2016 |
| City Of San Diego | ** Support | Aug 30, 2016 |
| City of San Francisco | ** Support | Apr 12, 2016 |
| Contractors State License Board | * Support | Jun 26, 2018 |
| Howard Jarvis Taxpayers Association | ** Against | Aug 30, 2016 |
| Los Angeles | ** Support | Aug 30, 2016 |
| Los Angeles 2024 Exploratory Committee | * Support | Apr 12, 2016 |
| Los Angeles Area Chamber Of Commerce | ** Support | Aug 30, 2016 |
| Los Angeles County Federation of Labor, AFL-CIO | ** Support | Aug 30, 2016 |
| Los Angeles Olympic Games 2024 | ** Support | Aug 30, 2016 |
| Los Angeles, City Of | ** Support | Aug 30, 2016 |
| Orange County Building Trades Council | ** Support | Aug 30, 2016 |
| S.M.A.R.T. Local Union 105 | ** Support | Aug 30, 2016 |
| San Jose, City Of | ** Support | Aug 30, 2016 |
| Santa Ana, City Of | ** Support | Aug 30, 2016 |
| Southern California Contractors Association | * Support | Jun 26, 2018 |
| State Building and Construction Trades Council of California | ** Support | Aug 30, 2016 |
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | SB |
UNFINISHED BUSINESS
Bill No: SB 1465
:
SENATE GOVERNMENTAL ORG. COMMITTEE: 11-1, 4/12/16
AYES: Hall, Berryhill, Block, Gaines, Galgiani, Glazer, Hernandez, Hill, Hueso, Lara, McGuire
NOES: Vidak
NO VOTE RECORDED: Runner
SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/27/16
AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen
SENATE FLOOR: 35-1, 6/1/16
AYES: Allen, Anderson, Bates, Beall, Berryhill, Block, Cannella, De León, Fuller, Gaines, Galgiani, Glazer, Hall, Hernandez, Hertzberg, Hill, Hueso, Huff, Jackson, Lara, Leno, Leyva, Liu, McGuire, Mendoza, Mitchell, Moorlach, Morrell, Nguyen, Nielsen, Pan, Pavley, Roth, Stone, Wieckowski
NOES: Vidak
NO VOTE RECORDED: Hancock, Monning, Runner, Wolk
ASSEMBLY FLOOR: 71-6, 8/30/16 - See last page for vote
DIGEST: This bill authorizes the Governor to execute games support contracts, in connection with the site selection process for the City of Los Angeles to host the 2024 Olympic Games and Paralympic Games, that accept financial liability (not to exceed $250 million) to provide the state security for amounts owed by the Organizing Committee for the Olympic Games (OCOG), as specified, and for any financial deficit accruing to the OCOG as a result of hosting the games by the City of Los Angeles. This bill also establishes the Olympic Games Trust Fund (OGT-Fund) as a special fund within the State Treasury for the sole purpose of fulfilling the obligations of the state under a games support contract to provide the state security.
Assembly Amendments remove the restriction which limited execution of contracts to agreements between the Governor and only the International Olympic Committee (IOC); make express that the funding security provided by the state shall be accomplished solely by means of funding mechanisms identified by the bill, only after specified conditions are met and are to be paid into and from the special OGT-Fund; and, clarify that the State Controller may use cash flow loans made from the OGT-Fund to the General Fund to fulfill the state obligations, as authorized under specified Sections of the Government Code. Additional amendments are technical and conforming.
ANALYSIS: Existing law provides specified requirements in awarding certain public contracts.
This bill:
- Enacts the 2024 Olympic Games and Paralympic Games Act for the purpose of establishing a structure to provide financial guarantees, as required by the IOC, to demonstrate that California and the City of Los Angeles are prepared to host the summer games.
- Makes the following legislative findings and declarations:
- Hosting the games in California is expected to generate billions of dollars for the state’s economy;
- The OCOG, on behalf of the City of Los Angeles, has developed a self-sufficient bid and plan for financing the games, including sufficient funds to reimburse local and regional governments for services provided during the games;
- The City of Los Angeles plans to host a sustainable and environmentally responsible games, has committed to sports and recreational opportunities for young people throughout the area and plans to develop and implement a unique and broad-based cultural program;
- The City of Los Angeles will involve athletes, sports professionals, environmentalists, business and financial experts, nonprofit organizations, youth service leaders and other individuals who represent the entire diversity of the state; and,
- The City of Los Angeles expects there will be net revenue exceeding expenses that can be devoted to legacy programs for youth and citizens of California.
- Defines “games support contract” to mean a joinder agreement executed by the Governor and containing terms permitted or required by this bill. Also, defines “joinder agreement” to mean an agreement in connection with the selection of a site in this state for the location of the games.
- Defines “state security” to mean the financial obligation, not to exceed $250 million, undertaken by the state pursuant to a games support contract executed by the Governor in accordance with this Act.
- Establishes within the State Treasury a special fund to be known as the “Olympic Games Trust Fund” (OGT-Fund) and provides that the state may choose to fund the OGT-Fund in any manner it considers appropriate and at the time or times the state determines necessary. Funds in the OGT-Fund may be used only for the sole purpose of fulfilling the obligations of the state under a games support contract to provide the state security. Also, permits the State Controller to use monies in the OGT-Fund for cash flow loans to the General Fund, as specified.
- Authorizes the Governor to execute games support contracts on behalf of the state that, in accordance with law and subject to the provisions of this Act, accept financial liability to provide the state security (not to exceed $250 million) for amounts owed by the OCOG, and for any financial deficit accruing to the OCOG as a result of hosting the games by the City of Los Angeles.
- Provides that the contracts shall provide the state security for amounts owed by the OCOG to the IOC and the International Paralympic Committee (IPC) for claims by third parties arising out of or relating to the games and any financial deficit accruing to the OCOG as a result of the hosting of the games by the City of Los Angeles.
- Makes it explicit that any liability for an amount in excess of $250 million shall be the responsibility of parties other than the state.
- Stipulates that the state shall, subject to the limitations set forth in this Act and the games support contract, be the payer of last resort with regard to the use of the state security. Also, specifies that the security provided by the state pursuant to this Act may not be accessed to cover a deficit from the games until all of the following occur:
- Security provided by the OCOG is fully expended and exhausted;
- Security provided by any other person or entity is fully expended and exhausted;
- The City of Los Angeles has expended and exhausted its $250 million security deposit;
- Limits of available insurance policies have been fully expended and exhausted; and,
- The OCOG has exhausted all efforts to seek payment from all third parties owing moneys or otherwise liable to the OCOG.
- Provides that no additional state funds shall be deposited into the OGT-Fund once the Director of Finance determines that the account has achieved, or is reasonably expected to otherwise accrue the balance necessary to provide the state security pursuant to a games support contract.
- Provides that if the City of Los Angeles is selected by the IOC as the host city for the games, the OGT-Fund shall be maintained until the Director of Finance makes a determination that the state’s obligation to provide the state security under a games support contract has been satisfied and concluded, at which time the OGT-Fund shall be terminated. Also, stipulates that if the City of Los Angeles is not selected by the IOC as the host city for the games, the OGT-Fund shall be immediately terminated and any monies therein shall immediately revert to the General Fund.
- Requires the OCOG to list the state as an additional insured on any policy of insurance purchased by the OCOG and prohibits the OCOG from engaging in any conduct that reflects unfavorably upon this state, the City of Los Angeles, the games, or that is contrary to law or the rules and regulations of the United States Olympic Committee (USOC) and the IOC/IPC.
Background
Purpose of SB 1465. The Los Angeles bid for the 2024 Summer Olympics and Paralympics is an ongoing attempt to bring the 2024 Olympic Games (XXXIII Olympiad) to the City of Los Angeles. Los Angeles is one of four candidate cities vying for the games – along with Paris, France; Rome, Italy; and Budapest, Hungary. The IOC is scheduled to select a host city in September 2017.
Los Angeles was chosen by the USOC on August 28, 2015, after the Los Angeles City Council voted unanimously to back the bid. The City of Boston was originally chosen to be the American bid, but withdrew in late July 2015 due to potential cost overruns.
According to the author’s office, this bill will establish a structure to provide state financial guarantees to demonstrate that California is serious and prepared to host the 2024 Olympic Games and Paralympic Games. This guarantee is required by the USOC and IOC as a prerequisite before any city can be considered for hosting an Olympic Games.
Los Angeles has hosted two prior Olympic Games with great success – in 1932 (the X Olympiad) and 1984 (the XXIII Olympiad). The author’s office notes that hosting the 2024 Olympic Games and Paralympic Games in Los Angeles is expected to generate billions of dollars of economic revenue for the state and local economies.
Related/Prior Legislation
SB 41 (De Leon, 2015) would have authorized the state to enter into an agreement with the USOC in connection with the City of Los Angeles’ bid to host the 2024 Olympic Games and Paralympic Games. (Held in the Senate Governmental Organization Committee at author’s request.)
AB 300 (Nunez, Chapter 4, Statutes of 2007) authorized the Governor to sign agreements required by the USOC as part of the City of Los Angeles’ 2016 Olympic Games bid process. The bill also authorized the Governor to make the state jointly liable (not to exceed $250 million), as specified, with the OCOG, a nonprofit corporation, for obligations of the OCOG and for any financial deficit relating to the games, and established the OGT-Fund.
SB 1987 (Burton, Chapter 16, Statutes of 2002) established a structure for the state to indemnify, insure and provide financial guarantees up to $250 million as required by the USOC to further the bid of the San Francisco Bay Area to host the 2012 Summer Olympic Games. The bill also provided the Governor the authority to sign any contracts on behalf of the state as part of the bid process.
FISCAL EFFECT: Appropriation: Fiscal Com.: Local:
According to the Assembly Appropriations Committee, potential one-time costs of up to $250 million, if Los Angeles is selected for the 2024 Olympics, the games incur large financial deficits, and all other securities provided by a General Fund appropriation or by insurance coverage, letters of credit, or other acceptable secured instruments purchased or secured by the General Funds, or by any combination thereof.
California Hotel and Lodging Association
California Travel Association
City and County of San Francisco
City of Anaheim
City of Bakersfield
City of Fresno
City of Long Beach
City of Los Angeles
City of Oakland
City of Sacramento
City of San Diego
City of San Jose
City of Santa Ana
International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers Local 92
Los Angeles Area Chamber of Commerce
Los Angeles County Federation of Labor, AFL-CIO
Los Angeles Olympic Games 2024
Los Angeles/Orange County Building Trades Council
S.M.A.R.T. Local Union 105
SEIU California
State Building and Construction Trades Council of California
The Valley Industry and Commerce Association
OPPOSITION: (Verified 8/29/16)
Howard Jarvis Taxpayers Association
ASSEMBLY FLOOR: 71-6, 8/30/16
AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Bigelow, Bloom, Bonilla, Bonta, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Frazier, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes, Medina, Mullin, Nazarian, Obernolte, O'Donnell, Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Weber, Wilk, Williams, Wood, Rendon
NOES: Baker, Brough, Beth Gaines, McCarty, Melendez, Waldron
NO VOTE RECORDED: Eggman, Gallagher, Olsen
8/30/16 19:51:49
SENATE THIRD READING
STR Bill Id:SB 1465
Author:(De León)
As Amended Ver:August 15, 2016
Majority vote
SENATE VOTE: 35-1
Committee | Votes | Ayes | Noes |
Arts | 7-0 | Chu, Obernolte, Hadley, Levine, Low, Medina, Nazarian | |
Appropriations | 19-0 | Gonzalez, Bigelow, Bloom, Bonilla, Bonta, Calderon, Chang, Daly, Eggman, Eduardo Garcia, Holden, Jones, Obernolte, Quirk, Santiago, Wagner, Weber, Wood, McCarty |
|
SUMMARY: Enacts the 2024 Olympic Games and Paralympic Games Act for the purpose of establishing a structure to provide state financial guarantees, as required by the International Olympic Committee (IOC), to demonstrate that California and the City of Los Angeles (LA) are prepared to host the summer games. Specifically, this bill:
- Authorizes the Governor to enter into agreements for the state to be jointly liable (up to $250 million), as specified, with the Organizing Committee for the Olympic Games (OCOG), a nonprofit corporation, for obligations of the OCOG and for any financial deficit relating to the games.
- Establishes the Olympic Games Trust Fund within the State Treasury and provides that the state may choose to fund the Olympic Games Trust Fund in any manner it considers appropriate and at the time or times the state determines necessary. If the City of Los Angeles is not selected as the host city, this fund is immediately terminated and any moneys therein immediately revert to the General Fund.
- Stipulates that all moneys deposited, transferred, or otherwise contained in the trust fund must, upon appropriation by the Legislature, be used for the sole purpose of obtaining adequate security to demonstrate the state's ability to fulfill its obligations to indemnify and insure up to $250 million of any net financial deficit and general liability resulting from the conduct of the games.
- Specifies that the security provided by the state pursuant to this Act may not be accessed to cover a deficit from the games until all the following occur:
- Security provided by the OCOG is fully exhausted.
- The City of Los Angeles has exhausted at least $250 million of its security deposit.
- Security provided by any other person or entity is exhausted.
- Limits of applicable insurance policies are fully exhausted.
- The OCOG has exhausted all efforts to seek payment from all third parties owning moneys or otherwise liable to the OCOG.
FISCAL: According to the Assembly Appropriations Committee, potential future one-time state costs of up to $250 million, if Los Angeles is selected for the 2024 Olympics, the games incur large financial deficits, and all other securities provided by non-state entities are first exhausted. The $250 million dollar liability may be secured by a General Fund appropriation or by insurance coverage, letters of credit, or other acceptable secured instruments purchased or secured by the General Funds, or by any combination thereof.
COMMENTS: According to the author's office, this bill would establish a structure to provide state financial guarantees to demonstrate that California is serious and prepared to host the 2024 Olympic Games and Paralympic Games. This guarantee is required by the United States Olympic Committee (USOC) and the International Olympic Committee and International Paralympic Committee (IOC) as a prerequisite before any city can be considered for hosting an Olympic Games. In support, the LA Area Chamber of Commerce notes that the only two times the Games made money were when Los Angeles served as host (1932 and 1984). This fact, they claim, will make passage of this measure very low risk to the state. They state, "hosting the Olympics will be good for tourism, good for tax revenues and business, and good for state pride and spirit." The State Building and Construction Trades Council also notes that proceeds from the 1984 games continue to support youth athletic programs all over southern California.
Recent amendments narrow the contracts the Governor may enter under the bill to "games support contracts" as defined, and remove the restriction which limited execution of contracts to agreements between the Governor and only the IOC. In addition, they make express that the funding security provided by the state shall be accomplished solely by means of funding mechanisms identified by the bill, only after specified conditions are met and are to be paid into and from the special Olympic Games Trust Fund (OGTF) the bill would establish. They further clarify that the Controller may use cash flow loans made from the OGTF to the General Fund to fulfill the state obligations, as authorized under the Government Code. Additional amendments are technical and conforming.
Please see Assembly Arts, Entertainment, Sports, Tourism, and Internet Media analysis for a full discussion of the measure.
Analysis Prepared by: Dana Mitchell / A.,E.,S.,T., & I.M. / (916) 319-3450 FN: 0004039
Date of Hearing: June 29, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
SBPCA Bill Id:SB 1465
Author:(De León) – As Amended Ver:June 16, 2016
Policy Committee: | Arts, Entertainment, Sports, Tourism, and Internet Media | Vote: | 7 - 0 |
Urgency: No State Mandated Local Program: No Reimbursable: No
SUMMARY:
This bill enacts the 2024 Olympic Games and Paralympic Games Act for the purpose of establishing a structure to provide state financial guarantees, as required by the International Olympic Committee (IOC), to demonstrate that California and the City of Los Angeles are prepared to host the summer games. Specifically, this bill:
- Authorizes the Governor to enter into an agreement for the state to be jointly liable (up to $250 million), as specified, with the Organizing Committee for the Olympic Games (OCOG), a nonprofit corporation, for obligations of the OCOG and for any financial deficit relating to the games.
- Establishes the Olympic Games Trust Fund within the State Treasury and provides that the state may choose to fund the Olympic Games Trust Fund in any manner it considers appropriate and at the time or times the state determines necessary. If the City of Los Angeles is not selected as the host city, this fund is immediately terminated and any moneys therein immediately revert to the General Fund.
- Stipulates that all moneys deposited, transferred, or otherwise contained in the trust fund must, upon appropriation by the Legislature, be used for the sole purpose of obtaining adequate security to demonstrate the state’s ability to fulfill its obligations to indemnify and insure up to $250 million of any net financial deficit and general liability resulting from the conduct of the games.
- Specifies that the security provided by the state pursuant to this Act may not be accessed to cover a deficit from the games until all the following occur:
- Security provided by the OCOG is fully exhausted
- Security provided by any other person or entity is exhausted.
- Limits of applicable insurance policies are fully exhausted.
- Payment has been sought by the OCOG from all third parties owning moneys.
- The City of Los Angeles has exhausted its $250 million security deposit.
FISCAL EFFECT:
Potential future one-time state costs of up to $250 million, if Los Angeles is selected for the 2024 Olympics, the games incur large financial deficits, and all other securities provided by non-state entities are first exhausted. The $250 million dollar liability may be secured by a General Fund appropriation or by insurance coverage, letters of credit, or other acceptable secured instruments purchased or secured by the General Funds, or by any combination thereof.
COMMENTS:
- Background. Los Angeles is one of four candidate cities vying for the 2024 Olympic Games, along with Paris, Rome, and Budapest. The IOC is scheduled to select a host city in September 2017. Los Angeles was chosen by the United States Olympic Committee (USOC) in August 2015, after the City of Boston, which was originally chosen to be the American bid, withdrew in July 2015 due to potential cost overruns. According to the LA 2024 Bid Committee, their bid has a strong risk mitigation strategy, mainly because almost all of the required venues already exist.
- Purpose. According to the author’s office, this bill would establish a structure to provide state financial guarantees to demonstrate that California is serious and prepared to host the 2024 Olympic Games and Paralympic Games. This guarantee is required by the USOC and the IOC as a prerequisite before any city can be considered for hosting an Olympic Games.
In support, the LA Area Chamber of Commerce notes that the only two times the Games made money were when Los Angeles served as host (1932 and 1984). This fact, they claim, will make passage of this measure very low risk to the state. They state, "hosting the Olympics will be good for tourism, good for tax revenues and business, and good for state pride and spirit." The State Building and Construction Trades Council also notes that proceeds from the 1984 games continue to support youth athletic programs all over southern California.
- Prior Legislation.
- SB 41 (de Leon), of 2015, a similar bill, was held in the Senate Governmental Organization Committee at the author’s request.
AB 300 (Nunez), Chapter 4, Statutes of 2007, provided a similar guarantee in connection with the City of Los Angeles’ bid to host the 2016 Summer Olympic Games.
- SB 1987 (Burton), Chapter 16, Statutes of 2002, provided a similar guarantee in connection with the San Francisco Bay Area's bid to host the 2012 Summer Olympic Games.
Analysis Prepared by: Chuck Nicol / APPR. / (916) 319-2081
Date of Hearing: June 21, 2016
ASSEMBLY COMMITTEE ON ARTS, ENTERTAINMENT, SPORTS, TOURISM, AND INTERNET MEDIA
Kansen Chu, Chair
SBPCA Bill Id:SB 1465
Author:(De León) – As Amended Ver:June 16, 2016
SENATE VOTE: 35-1
SUBJECT: Public contracts: 2024 Olympic Games and Paralympic Games.
SUMMARY: This bill would authorize the Governor to sign agreements with the International Olympic Committee (IOC) and the International Paralympic Committee (IPC) as part of the site selection process for the City of Los Angeles’ bid to host the 2024 Olympic Games and Paralympic Games. This bill would also authorize the Governor to enter into an agreement for the state to be jointly liable (up to $250 million), as specified, with the Organizing Committee for the Olympic Games (OCOG), a nonprofit corporation, for obligations of the OCOG and for any financial deficit relating to the games, and establishes the Olympic Games Trust Fund. Specifically, this bill:
- Enacts the 2024 Olympic Games and Paralympic Games Act for the purpose of establishing a structure to provide financial guarantees, as required by the IOC, that California and the City of Los Angeles are prepared to host the summer games.
- Makes the following legislative findings and declarations:
- Hosting the games in California is expected to generate billions of dollars for the state’s economy;
- The OCOG, on behalf of the City of Los Angeles, has developed a self-sufficient bid for financing the games, including sufficient funds to reimburse local and regional governments for services provided during the games;
- The City of Los Angeles plans to host a sustainable and environmentally responsible games, has committed to sports and recreational opportunities for young people throughout the area and plans to develop and implement a unique and broad-based cultural program;
- The City of Los Angeles has involved athletes, sports professionals, environmentalists, business and financial experts, nonprofit organizations, youth service leaders and other individuals who represent the entire diversity of the state; and,
- The City of Los Angeles expects there will be net revenue exceeding expenses that can be devoted to legacy programs for youth and citizens of California.
- Hosting the games in California is expected to generate billions of dollars for the state’s economy;
- Defines “games support contract” to mean a joinder agreement executed by the Governor and containing terms permitted or required by this bill. Also, defines “joinder agreement” to mean an agreement entered into by the Governor, on behalf of the state, and the IOC and the IPC setting out representations and assurances by the state in connection with the selection of a site in this state for the location of the games.
- Authorizes the Governor to enter into a joinder agreement specifying that the state shall provide or cause to be provided any or all of the state government funding, facilities, and other resources specified in the OCOG’s bid to host the games.
- Provides that the agreements shall accept liability for obligations of the OCOG to a site selection organization, including obligations indemnifying the site selection organization against claims and liabilities to third parties arising out of or relating to the games.
- Provides that any liability for an amount in excess of $250 million shall be the responsibility of the OCOG. Also, provides that the OCOG will be bound by a series of agreements with the site selection organization as set forth in the joinder agreement.
- Establishes within the State Treasury a special fund to be known as the “Olympic Games Trust Fund” and provides that the state may choose to fund the Olympic Games Trust Fund in any manner it considers appropriate and at the time or times the state determines necessary. Funds in the Trust Fund may be used only for the sole purpose of fulfilling the obligations of the state under a games support contract to provide adequate security, as specified.
- Provides that no additional state funds shall be deposited into the Olympic Games Trust Fund once the Director of Finance determines that the account has achieved a sufficient balance to provide adequate security to demonstrate the state’s ability to fulfill its obligations under a games support contract, or any other agreement, to indemnify and insure up to $250 million of any net financial deficit and general liability resulting from the conduct of the games.
- Provides that if the City of Los Angeles is selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be maintained until a determination by the Department of Finance is made that the state’s obligations under a games support contract, or any other agreement, to indemnify and insure against any net financial deficit and general liability resulting from the conduct of the games are satisfied and concluded, at which time the trust fund shall be terminated. Also, stipulates that if the City of Los Angeles is not selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be immediately terminated and any monies therein shall immediately revert to the General Fund.
- Stipulates that all moneys deposited, transferred, or otherwise contained in the trust fund shall be, upon appropriation by the Legislature, used for the sole purpose of obtaining adequate security to demonstrate the state’s ability to fulfill its obligations under a games support contract, or any other agreement, to indemnify and insure up to $250 million of any net financial deficit and general liability resulting from the conduct of the games.
- Makes it explicit that the state, along with the City of Los Angeles, will be the payer of last resort with regard to any net financial deficit. Also, provides that any financial security provided by this bill may not be accessed until the security provided by the OCOG or by any other entity is exhausted and any insurance policies covering the state’s liability are exhausted.
EXISTING LAW: Existing law provides specified requirements in awarding certain public contracts.
FISCAL EFFECT: According to Senate Appropriations Committee, potential future state costs of up to $250 million, should Los Angeles be selected as the site of the 2024 Olympics by the IOC. State costs would only occur if the 2024 games incurred large financial deficits, and all other securities provided by non-state entities are exhausted. The $250 million dollar liability may be secured by a General Fund appropriation or by insurance coverage, letters of credit, or other acceptable secured instruments purchased or secured by the General Funds, or by any combination thereof.
COMMENTS:
- Background: Los Angeles bid for Olympics. The Los Angeles bid for the 2024 Summer Olympics and Paralympics is an ongoing attempt to bring the 2024 Olympic Games (XXXIII Olympiad) to the City of Los Angeles. Los Angeles is one of four candidate cities vying for the games – along with Paris, France; Rome, Italy; and Budapest, Hungary. The IOC is scheduled to select a host city in September 2017.
Los Angeles was chosen by the United States Olympic Committee (USOC) on August 28, 2015 after the Los Angeles City Council voted unanimously to back the bid. The City of Boston was originally chosen to be the American bid, but withdrew in late July 2015 due to potential cost overruns.
According to information supplied by the LA 2024 Bid Committee, their bid has a strong overall risk mitigation strategy, which features three key components:
- First, all main Olympic Games facilities exist or are planned, these include the “Big Three” Olympic venues: the Olympic Stadium (which will be the LA Coliseum), Olympic Village (athletes will be hosted by UCLA at their campus), and International Broadcast Center/Main Press Center (which will be housed at the NBC/Universal lot).
- Second, there will be minimal construction of new competition venues necessary, as 97% of venues are existing, already planned, or temporary. According to LA24, only one new permanent competition venue will be built for canoe slalom.
- Finally, the remaining risk will be comprehensively covered by a combined approach of conservative budgeting; significant budget contingency; insurance for any unanticipated issues; and lastly, in the very unlikely event of net liabilities that exceed the Los Angeles 2024 budget, SB 1465 provides that the City of Los Angeles must initially contribute at least $250 million prior to any State contribution.
- Author's statement of need for legislation: Bill is necessary to fulfill IOC requirements and will stimulate the economy. According to the author’s office, this bill would establish a structure to provide state financial guarantees to demonstrate that California is serious and prepared to host the 2024 Olympic Games and Paralympic Games. This guarantee is required by the USOC and IOC as a prerequisite before any city can be considered for hosting an Olympic Games. Furthermore, the USOC and IOC require that all bid states and bid committees execute certain agreements including the authorized agreements contain in this bill. He notes that, this bill proposes that the state’s liability shall not exceed the amount of funds appropriated (up to $250 million) to the Olympic Games Trust Fund. The funds may only be used for the sole purpose of fulfilling the obligations of the state under a games support contract to demonstrate adequate financial security. Any liability above this amount shall be the responsibility of the OCOG.
Supporters, such as the State Building and Construction Trades Council, add that hosting the 2024 Olympic Games and Paralympic Games in Los Angeles is expected to generate billions of dollars of economic revenue for the state and local economies. They point to the fact the city has hosted two prior Olympic Games with great success in 1932 (the X Olympiad) and 1984 (the XXIII Olympiad), and note that proceeds from the 1984 games continue to support youth athletic programs all over southern California today.
The LA Area Chamber of Commerce proudly points out that the only two times in history the Games made money were both when Los Angeles served as host. This fact, they claim, will make passage of this measure very low risk to the state. They close by stating, "hosting the Olympics will be good for tourism, good for tax revenues and business, and good for state pride and spirit."
- Author's recent amendments: Adding geographic diversity to strengthen this legislation. One of the findings and declarations in this bill states that, "The endorsing municipality will involve athletes, sports professionals, environmentalists, business and financial experts, nonprofit organizations, youth service leaders and other individuals who represent the entire diversity of the endorsing municipality's state in its bid." In adding the word "state" instead of "area", the authors have expanded this scope beyond the Los Angeles region to include the diverse geography of the state of California. We envision hosting preliminary rounds of competitions such as soccer trials at Levi Stadium, track and field qualifying at CSU Sacramento, softball and baseball played at CSU Fresno, or rowing hosted by UC Berkeley, the possibilities are many. This concept is in keeping with most international competitions, such as the recent Women's World Cup of soccer, hosted by Canada and played in cities ranging from Moncton, on the East coast in New Brunswick and the central city of Montreal, Quebec all the way to Vancouver, British Columbia on the West coast. Indeed the coming Summer Olympic Games in Rio will have events at 45 different venues all across their nation. This expansion could be accomplished prudently, using the existing stellar facilities of northern California in addition to those in the LA area.
- Prior related legislation.
- SB 41 (de Leon), of 2015, would have authorized the state to enter into an agreement with the USOC in connection with the City of Los Angeles’ bid to host the 2024 Olympic Games and Paralympic Games. (Held in the Senate Governmental Organization Committee at author’s request.)
- SCR 49 (Gaines), Resolution Statute 86, Statutes of 2011, urged the California Winter Games Committee to consider Lake Tahoe as a host region for the Winter Games.
AB 300 (Nunez), Ch.4, Statutes of 2007, authorized the Governor to sign agreements required by the USOC as part of the City of Los Angeles’ 2016 Olympic Games bid process. The bill also authorized the Governor to make the state jointly liable (not to exceed $250 million), as specified, with the OCOG, a nonprofit corporation, for obligations of the OCOG and for any financial deficit relating to the games, and established the Olympic Games Trust Fund.
- SB 1987 (Burton), Ch.16, Statutes of 2002, established a structure for the state to indemnify, insure and provide financial guarantees up to $250 million as required by the USOC to further the bid of the San Francisco Bay Area to host the 2012 Summer Olympic Games. The bill also provided the Governor the authority to sign any contracts on behalf of the state as part of the bid process.
REGISTERED SUPPORT / OPPOSITION:
Support
City of Anaheim
City of Bakersfield
City of Fresno
City of Long Beach
City of Los Angeles
City of Oakland
City of Sacramento
City of San Diego
City and County of San Francisco
City of San Jose
City of Santa Ana
California Hotel and Lodging Association
International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers & Helpers Local 92
Los Angeles Area Chamber of Commerce
Los Angeles County Federation of Labor, AFL-CIO
Los Angeles Olympic Games 2024
Los Angeles/Orange County Building Trades Council
SEIU California
S.M.A.R.T. Local Union 105
State Building and Construction Trades Council of California
Opposition
There is no opposition on file.
Analysis Prepared by: Dana Mitchell / A.,E.,S.,T., & I.M. / (916) 319-3450
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | SB |
THIRD READING
Bill No: SB 1465
: 5/31/16
SENATE GOVERNMENTAL ORG. COMMITTEE: 11-1, 4/12/16
AYES: Hall, Berryhill, Block, Gaines, Galgiani, Glazer, Hernandez, Hill, Hueso, Lara, McGuire
NOES: Vidak
NO VOTE RECORDED: Runner
SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/27/16
AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen
DIGEST: This bill authorizes the Governor to sign agreements with the International Olympic Committee (IOC) and the International Paralympic Committee (IPC) as part of the site selection process for the City of Los Angeles’ bid to host the 2024 Olympic Games and Paralympic Games. This bill also authorizes the Governor to enter into an agreement for the state to be jointly liable (up to $250 million), as specified, with the Organizing Committee for the Olympic Games (OCOG), a nonprofit corporation, for obligations of the OCOG and for any financial deficit relating to the games, and establishes the Olympic Games Trust Fund.
ANALYSIS: Existing law provides specified requirements in awarding certain public contracts.
This bill:
- Enacts the 2024 Olympic Games and Paralympic Games Act for the purpose of establishing a structure to provide financial guarantees, as required by the IOC, that California and the City of Los Angeles are prepared to host the summer games.
- Makes the following legislative findings and declarations:
- Hosting the games in California is expected to generate billions of dollars for the state’s economy;
- The OCOG, on behalf of the City of Los Angeles, has developed a self-sufficient bid for financing the games, including sufficient funds to reimburse local and regional governments for services provided during the games;
- The City of Los Angeles plans to host a sustainable and environmentally responsible games, has committed to sports and recreational opportunities for young people throughout the area and plans to develop and implement a unique and broad-based cultural program;
- The City of Los Angeles has involved athletes, sports professionals, environmentalists, business and financial experts, nonprofit organizations, youth service leaders and other individuals who represent the entire diversity of the Los Angeles area; and,
- The City of Los Angeles expects there will be net revenue exceeding expenses that can be devoted to legacy programs for youth and citizens of California.
- Hosting the games in California is expected to generate billions of dollars for the state’s economy;
- Defines “games support contract” to mean a joinder agreement executed by the Governor and containing terms permitted or required by this bill. Also, defines “joinder agreement” to mean an agreement entered into by the Governor, on behalf of the state, and the IOC and the IPC setting out representations and assurances by the state in connection with the selection of a site in this state for the location of the games.
- Authorizes the Governor to enter into a joinder agreement specifying that the state shall provide or cause to be provided any or all of the state government funding, facilities, and other resources specified in the OCOG’s bid to host the games.
- Provides that the agreements shall accept liability for obligations of the OCOG to a site selection organization, including obligations indemnifying the site selection organization against claims and liabilities to third parties arising out of or relating to the games.
- Provides that any liability for an amount in excess of $250 million shall be the responsibility of the OCOG. Also, provides that the OCOG will be bound by a series of agreements with the site selection organization as set forth in the joinder agreement.
- Establishes within the State Treasury a special fund to be known as the “Olympic Games Trust Fund” and provides that the state may choose to fund the Olympic Games Trust Fund in any manner it considers appropriate and at the time or times the state determines necessary. Funds in the Trust Fund may be used only for the sole purpose of fulfilling the obligations of the state under a games support contract to provide adequate security, as specified.
- Provides that no additional state funds shall be deposited into the Olympic Games Trust Fund once the Director of Finance determines that the account has achieved a sufficient balance to provide adequate security to demonstrate the state’s ability to fulfill its obligations under a games support contract, or any other agreement, to indemnify and insure up to $250 million of any net financial deficit and general liability resulting from the conduct of the games.
- Provides that if the City of Los Angeles is selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be maintained until a determination by the Department of Finance is made that the state’s obligations under a games support contract, or any other agreement, to indemnify and insure against any net financial deficit and general liability resulting from the conduct of the games are satisfied and concluded, at which time the trust fund shall be terminated. Also, stipulates that if the City of Los Angeles is not selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be immediately terminated and any monies therein shall immediately revert to the General Fund.
- Stipulates that all moneys deposited, transferred, or otherwise contained in the trust fund shall be, upon appropriation by the Legislature, used for the sole purpose of obtaining adequate security to demonstrate the state’s ability to fulfill its obligations under a games support contract, or any other agreement, to indemnify and insure up to $250 million of any net financial deficit and general liability resulting from the conduct of the games.
- Makes it explicit that the state, along with the City of Los Angeles, will be the payer of last resort with regard to any net financial deficit. Also, provides that any financial security provided by this bill may not be accessed until the security provided by the OCOG or by any other entity is exhausted and any insurance policies covering the state’s liability are exhausted.
Background
Purpose of SB 1465. The Los Angeles bid for the 2024 Summer Olympics and Paralympics is an ongoing attempt to bring the 2024 Olympic Games (XXXIII Olympiad) to the City of Los Angeles. Los Angeles is one of four candidate cities vying for the games – along with Paris, France; Rome, Italy; and Budapest, Hungary. The IOC is scheduled to select a host city in September 2017.
Los Angeles was chosen by the United States Olympic Committee (USOC) on August 28, 2015 after the Los Angeles City Council voted unanimously to back the bid. The City of Boston was originally chosen to be the American bid, but withdrew in late July 2015 due to potential cost overruns.
According to the author’s office, this bill establishes a structure to provide state financial guarantees to demonstrate that California is serious and prepared to host the 2024 Olympic Games and Paralympic Games. This guarantee is required by the USOC and IOC as a prerequisite before any city can be considered for hosting an Olympic Games. Furthermore, the USOC and IOC require that all bid states and bid committees execute certain agreements including the authorized agreements contain in this bill.
This bill proposes that the state’s liability shall not exceed the amount of funds appropriated (up to $250 million) to the Olympic Games Trust Fund. The funds may only be used for the sole purpose of fulfilling the obligations of the state under a games support contract to demonstrate adequate financial security. Any liability above this amount shall be the responsibility of the OCOG.
Los Angeles has hosted two prior Olympic Games with great success – in 1932 (the X Olympiad) and 1984 (the XXIII Olympiad). The author’s office notes that hosting the 2024 Olympic Games and Paralympic Games in Los Angeles is expected to generate billions of dollars of economic revenue for the state and local economies.
Prior/Related Legislation
SB 41 (De Leon, 2015) would have authorized the state to enter into an agreement with the USOC in connection with the City of Los Angeles’ bid to host the 2024 Olympic Games and Paralympic Games. (Held in the Senate Governmental Organization Committee at author’s request.)
AB 300 (Nunez, Chapter 4, Statutes of 2007) authorized the Governor to sign agreements required by the USOC as part of the City of Los Angeles’ 2016 Olympic Games bid process. The bill also authorized the Governor to make the state jointly liable (not to exceed $250 million), as specified, with the OCOG, a nonprofit corporation, for obligations of the OCOG and for any financial deficit relating to the games, and established the Olympic Games Trust Fund.
SB 1987 (Burton, Chapter 16, Statutes of 2002) established a structure for the state to indemnify, insure and provide financial guarantees up to $250 million as required by the USOC to further the bid of the San Francisco Bay Area to host the 2012 Summer Olympic Games. The bill also provided the Governor the authority to sign any contracts on behalf of the state as part of the bid process.
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No
According to Senate Appropriations Committee, potential future state costs of up to $250 million*, should Los Angeles be selected as the site of the 2024 Olympics by the IOC. State costs would only occur if the 2024 games incurred large financial deficits, and all other securities provided by non-state entities are exhausted.
*The liability may be secured by a General Fund appropriation or by insurance coverage, letters of credit, or other acceptable secured instruments purchased or secured by the General Funds, or by any combination thereof.
SUPPORT:
(Verified 5/31/16)
City of Anaheim
City of Bakersfield
City of Fresno
City of Long Beach
City of Los Angeles
City of Oakland
City of Sacramento
City of San Diego
City and County of San Francisco
City of San Jose
City of Santa Ana
Los Angeles Area Chamber of Commerce
Los Angeles Olympic Games 2024
Los Angeles/Orange County Building Trades Council
State Building and Construction Trades Council of California
OPPOSITION: (Verified 5/31/16)
None received
5/31/16 21:52:01
**** END ****
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
SB 1465 (De León) - Public contracts: 2024 Olympic Games and Paralympic Games
Version: March 29, 2016 | Policy Vote: G.O. 11 - 1 |
Urgency: No | Mandate: No |
Hearing Date: May 27, 2016 | Consultant: Mark McKenzie |
Bill Summary:
SB 1465 would authorize the Governor to sign agreements required by the United State Olympic Committee (USOC) as part of the City of Los Angeles 2024 Olympic Games bid process. The bill would authorize the Governor to make the state jointly liable, as specified, with the Organizing Committee for the Olympic Games (OCOG), a nonprofit corporation, for obligations of the OCOG and for any financial deficit relating to the games, as specified.
*********** ANALYSIS ADDENDUM – SUSPENSE FILE ***********
The following information is revised to reflect amendments
adopted by the committee on May 27, 2016
Fiscal Impact:
- Potential future state costs of up to $250 million*, should Los Angeles be selected as the site of the 2024 Olympics by the International Olympic Committee (IOC). State costs would only occur if the 2024 games incurred large financial deficits, and all other securities provided by non-state entities are exhausted.
* The liability may be secured by a General Fund appropriation or by insurance coverage, letters of credit, or other acceptable secured instruments purchased or secured by the General Funds, or by any combination thereof.
Author Amendments:
Add coauthors and make technical changes.
-- END --
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
SB 1465 (De León) - Public contracts: 2024 Olympic Games and Paralympic Games
Version: March 29, 2016 | Policy Vote: G.O. 11 - 1 |
Urgency: No | Mandate: No |
Hearing Date: April 25, 2016 | Consultant: Mark McKenzie |
This bill meets the criteria for referral to the Suspense File.
Bill Summary:
SB 1465 would authorize the Governor to sign agreements required by the United State Olympic Committee (USOC) as part of the City of Los Angeles 2024 Olympic Games bid process. The bill would authorize the Governor to make the state jointly liable, as specified, with the Organizing Committee for the Olympic Games (OCOG), a nonprofit corporation, for obligations of the OCOG and for any financial deficit relating to the games, as specified.
Fiscal Impact:
Potential future state costs of up to $250 million*, should Los Angeles be selected as the site of the 2024 Olympics by the International Olympic Committee (IOC). State costs would only occur if the 2024 games incurred large financial deficits, and all other securities provided by non-state entities are exhausted.
* The liability may be secured by a General Fund appropriation or by insurance coverage, letters of credit, or other acceptable secured instruments purchased or secured by the General Funds, or by any combination thereof.
Background:
The Los Angeles bid for the 2024 Summer Olympics and Paralympics is an ongoing attempt to bring the 2024 Olympic Games (XXXIII Olympiad) to the City of Los Angeles. Los Angeles is one of four candidate cities vying for the games – along with Paris, France; Rome, Italy; and Budapest, Hungary. The IOC is scheduled to select a host city in September 2017.
Los Angeles was chosen by the USOC as the American host city candidate on August 28, 2015 after the Los Angeles City Council voted unanimously to back the bid. The City of Boston was originally chosen to be the American bid, but withdrew in late July 2015 due to potential cost overruns.
Proposed Law:
SB 1465, the 2024 Olympic Games and Paralympic Games Act, would establish a structure to provide assurances required by the International Olympic and/or Paralympic Committees to demonstrate that the City of Los Angeles is prepared to host the summer games. Among other things, this bill would:
- Authorize the Governor to enter into an agreement on behalf of the state with the international site selection organizations setting out representations and assurances in connection with the selection of a host site in this state. The agreement must provide for the state accepting liability for any net financial deficit of the games, not to exceed $250 million, as specified.
- Establish the Olympic Games Trust Fund and authorize the state to fund it in any manner it considers appropriate and at the time it deems necessary. Any funds on deposit may only be used to obtain adequate security to fulfill the obligations of the state under a games support contract to indemnify and insure up to $250 million of general liabilities and net financial deficit from the games.
- Require the Olympic Games Trust Fund to be maintained until the Director of Finance determines that the state’s obligations are fulfilled, if Los Angeles is chosen as the host city. The Trust Fund must be immediately terminated if Los Angeles is not selected, and any sum on deposit reverts to the General Fund.
- Require the state and City of Los Angeles to be the payers of last resort regarding any net financial deficit, and prohibit accessing any state security for liabilities and deficits until and after: (1) all OCOG security is exhausted; (2) any security provided by any other person or entity is exhausted; (3) the limits of any relevant insurance policies have been fully expended and exhausted; (4) payment has been sought by the OCOG from all third parties liable to the OCOG; and (5) Los Angeles has expended and exhausted $250 million of its security deposit.
Related Legislation:
This bill is similar to AB 300 (Nunez), Chap 4/2007, which authorized the state to enter into an agreement with the USOC as part of the City of Los Angeles 1016 Olympic Games bid process.
This bill is also similar to SB 1987 (Burton), Chap 16/2002, which authorized the state to enter into an agreement with the USOC in connection with the City of San Francisco’s bid to host the 2012 Olympic Games.
Staff Comments:
The OCOG has been authorized by the City of Los Angeles to pursue an application and bid with a site selection organization for selection as the site for the games, and has executed a bid committee agreement with the USOC regarding a bid to host the 2024 Olympic Games. Staff notes that the City’s bid proposal contains several features that minimize the potential for financial risk. Most importantly, the need for new construction (which has been the cause of cost overruns in other host cities) is minimized because nearly all of the event venues, as well as proposed sites for the Olympic Stadium, Village, and press center, already exist. The bid also does not propose any new public infrastructure or intentions to use the Games as a tool for urban renewal or redevelopment projects.
SB 1465 creates the Olympic Games Trust Fund and authorizes deposits in amounts necessary to provide adequate security to cover up to $250 million in potential financial obligations. The state could cover these obligations from balances on deposit in the Trust Fund itself, or it could purchase insurance, letters of credit, or another form of financial guarantees from outside parties.
The state will be the payer of last resort for any liabilities and net financial deficits related to the staging of the Games. Any financial security provided by the bill would only be accessed if Los Angeles is chosen as the host city and the Games are a financial failure. Furthermore, state payments would not occur until the security provided by the OCOG or by any other entity is exhausted and any insurance policies covering the state’s liability are exhausted. This bill is similar to previous measures enacted as part of host city bids for the 2012 and 2016 Summer Games, but AB 1465 includes an additional layer of security against the state covering any liabilities and losses by requiring the City of Los Angeles to expend and exhaust $250 million of its security deposit before any state payments are made.
SB 1465 does not contain an appropriation, but is intended to demonstrate the state’s commitment as part of the Olympic bid process. Any state funding would be provided in a future act of the Legislature. Staff notes the bill makes no mention of how any revenues would be distributed or by whom. Presumably, if a future Legislature appropriates the funding necessary for the state to fulfill its obligations under a games support contract, it would specify how any revenue (and potentially the amount of those revenues) would be distributed.
-- END --
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Isadore Hall, III
Chair
2015 - 2016 Regular
Bill No: SB Hearing Date: 4/12/2016
Author: | De León | ||
Version: | Amended | ||
Urgency: | Fiscal: | ||
Consultant: | |||
SUBJECT:
DIGEST: This bill authorizes the Governor to sign agreements with the International Olympic Committee (IOC) and the International Paralympic Committee (IPC) as part of the site selection process for the City of Los Angeles’ bid to host the 2024 Olympic Games and Paralympic Games. This bill also authorizes the Governor to enter into an agreement for the state to be jointly liable (up to $250 million), as specified, with the Organizing Committee for the Olympic Games (OCOG), a nonprofit corporation, for obligations of the OCOG and for any financial deficit relating to the games, and establishes the Olympic Games Trust Fund.
ANALYSIS: Existing law provides specified requirements in awarding certain public contracts.
This bill:
- Enacts the 2024 Olympic Games and Paralympic Games Act for the purpose of establishing a structure to provide financial guarantees, as required by the IOC, that California and the City of Los Angeles are prepared to host the summer games.
- Makes the following legislative findings and declarations:
- Hosting the games in California is expected to generate billions of dollars for the state’s economy;
- The OCOG, on behalf of the City of Los Angeles, has developed a self-sufficient bid for financing the games, including sufficient funds to reimburse local and regional governments for services provided during the games;
- The City of Los Angeles plans to host a sustainable and environmentally responsible games, has committed to sports and recreational opportunities for young people throughout the area and plans to develop and implement a unique and broad-based cultural program;
- The City of Los Angeles has involved athletes, sports professionals, environmentalists, business and financial experts, nonprofit organizations, youth service leaders and other individuals who represent the entire diversity of the Los Angeles area; and,
- The City of Los Angeles expects there will be net revenue exceeding expenses that can be devoted to legacy programs for youth and citizens of California.
- Hosting the games in California is expected to generate billions of dollars for the state’s economy;
- Defines “games support contract” to mean a joinder agreement executed by the Governor and containing terms permitted or required by this bill. Also, defines “joinder agreement” to mean an agreement entered into by the Governor, on behalf of the state, and the IOC and the IPC setting out representations and assurances by the state in connection with the selection of a site in this state for the location of the games.
- Authorizes the Governor to enter into a joinder agreement specifying that the state shall provide or cause to be provided any or all of the state government funding, facilities, and other resources specified in the OCOG’s bid to host the games.
- Provides that the agreements shall accept liability for obligations of the OCOG to a site selection organization, including obligations indemnifying the site selection organization against claims and liabilities to third parties arising out of or relating to the games.
- Provides that any liability for an amount in excess of $250 million shall be the responsibility of the OCOG. Also, provides that the OCOG will be bound by a series of agreements with the site selection organization as set forth in the joinder agreement.
- Establishes within the State Treasury a special fund to be known as the “Olympic Games Trust Fund” and provides that the state may choose to fund the Olympic Games Trust Fund in any manner it considers appropriate and at the time or times the state determines necessary. Funds in the trust fund may be used only for the sole purpose of fulfilling the obligations of the state under a games support contract to provide adequate security, as specified.
- Provides that no additional state funds shall be deposited into the Olympic Games Trust Fund once the Director of Finance determines that the account has achieved a sufficient balance to provide adequate security to demonstrate the state’s ability to fulfill its obligations under a games support contract, or any other agreement, to indemnify and insure up to $250 million of any net financial deficit and general liability resulting from the conduct of the games.
- Provides that if the City of Los Angeles is selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be maintained until a determination by the Department of Finance is made that the state’s obligations under a games support contract, or any other agreement, to indemnify and insure against any net financial deficit and general liability resulting from the conduct of the games are satisfied and concluded, at which time the trust fund shall be terminated. Also, stipulates that if the City of Los Angeles is not selected by the site selection organization as the host city for the games, the Olympic Games Trust Fund shall be immediately terminated and any monies therein shall immediately revert to the General Fund.
- Stipulates that all moneys deposited, transferred, or otherwise contained in the trust fund shall be, upon appropriation by the Legislature, used for the sole purpose of obtaining adequate security to demonstrate the state’s ability to fulfill its obligations under a games support contract, or any other agreement, to indemnify and insure up to $250 million of any net financial deficit and general liability resulting from the conduct of the games.
- Makes it explicit that the state, along with the City of Los Angeles, will be the payer of last resort with regard to any net financial deficit. Also, provides that any financial security provided by the bill may not be accessed until the security provided by the OCOG or by any other entity is exhausted and any insurance policies covering the state’s liability are exhausted.
Background
Purpose of SB 1465. The Los Angeles bid for the 2024 Summer Olympics and Paralympics is an ongoing attempt to bring the 2024 Olympic Games (XXXIII Olympiad) to the City of Los Angeles. Los Angeles is one of four candidate cities vying for the games – along with Paris, France; Rome, Italy; and Budapest, Hungary. The IOC is scheduled to select a host city in September 2017.
Los Angeles was chosen by the United States Olympic Committee (USOC) on August 28, 2015 after the Los Angeles City Council voted unanimously to back the bid. The City of Boston was originally chosen to be the American bid, but withdrew in late July 2015 due to potential cost overruns.
According to the author’s office, this bill would establish a structure to provide state financial guarantees to demonstrate that California is serious and prepared to host the 2024 Olympic Games and Paralympic Games. This guarantee is required by the USOC and IOC as a prerequisite before any city can be considered for hosting an Olympic Games. Furthermore, the USOC and IOC require that all bid states and bid committees execute certain agreements including the authorized agreements contain in this bill.
This bill proposes that the state’s liability shall not exceed the amount of funds appropriated (up to $250 million) to the Olympic Games Trust Fund. The funds may only be used for the sole purpose of fulfilling the obligations of the state under a games support contract to demonstrate adequate financial security. Any liability above this amount shall be the responsibility of the OCOG.
Los Angeles has hosted two prior Olympic Games with great success – in 1932 (the X Olympiad) and 1984 (the XXIII Olympiad). The author’s office notes that hosting the 2024 Olympic Games and Paralympic Games in Los Angeles is expected to generate billions of dollars of economic revenue for the state and local economies.
Prior/Related Legislation
SB 41 (De Leon, 2015) would have authorized the state to enter into an agreement with the USOC in connection with the City of Los Angeles’ bid to host the 2024 Olympic Games and Paralympic Games. (Held in this committee at author’s request.)
AB 300 (Nunez, Chapter 4, Statutes of 2007) authorized the Governor to sign agreements required by the USOC as part of the City of Los Angeles’ 2016 Olympic Games bid process. This bill also authorized the Governor to make the state jointly liable (not to exceed $250 million), as specified, with the OCOG, a nonprofit corporation, for obligations of the OCOG and for any financial deficit relating to the games, and established the Olympic Games Trust Fund.
SB 1987 (Burton, Chapter 16, Statutes of 2002) established a structure for the state to indemnify, insure and provide financial guarantees up to $250 million as required by the USOC to further the bid of the San Francisco Bay Area to host the 2012 Summer Olympic Games. The bill also provided the Governor the authority to sign any contracts on behalf of the state as part of the bid process.
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No
SUPPORT:
City of Anaheim
City of Bakersfield
City of Fresno
City of Long Beach
City of Los Angeles
City of Oakland
City of Sacramento
City of San Diego
City of San Francisco
City of San Jose
City of Santa Ana
Los Angeles Area Chamber of Commerce
Los Angeles Olympic Games 2024
Los Angeles/Orange County Building Trades Council
State Building and Construction Trades Council of California
OPPOSITION:
None received
Bill Author
