But organizers of the Olympics, which open here on Friday, say they can learn from the past and provide a better model.
Paris has tried to keep costs down by minimizing new construction — France already has plenty of sports venues, including the mega football stadium Stade de France and the tennis complex Roland Garros — so the main projects in the budget are an Olympic village, an aquatics center and an 8,000-seat arena, all with plans for use after the Olympics.
“Our plan from the beginning was to save money and not invest in things that don't work,” CEO Etienne Thobois said. A statement from the Paris 2024 Organizing Committee: “The Olympics adapt to the city, not the other way around.”
France has renovated existing venues and created temporary spaces to showcase the country's landmarks: athletes will play beach volleyball beneath the Eiffel Tower, fence at the Grand Palais and hold equestrian events in the gardens of Versailles.
“We're not going to waste anything,” Toboa said. “Everyone recognizes the need to keep the costs of the Olympics down.”
This strategy has kept the projected cost of the Paris Olympics significantly lower than those of the previous three Summer Olympics: Tokyo, Rio and London.
But like previous Olympics, Paris 2024 will be more expensive than anticipated when the city made its bid, and the benefits of hosting remain unclear, economists say.
“Paris is a step in the right direction,” said Alexander Bazier of Oxford University, who has studied Olympic cost trends.
“The question remains: is it really worth the money?” he said. “The idea is that we can really make the Olympics cheaper by reusing and refurbishing venues? At this point, that's not the case.”
The price of the Olympics
According to the latest estimates, the budget for facilities and operations for the Paris Olympic and Paralympic Games will be $8.9 billion. 1 billion euros, approximately $9.7 billion a billion.
If that happens, the Olympics That's cheaper than London ($16.8 billion), Rio ($23.6 billion) and Tokyo (more than $13.7 billion), according to a study co-authored by Badger.
But Paris isn't bucking the trend of over-budgeting, nor is it particularly cheap, he said.
Organizers say inflation is the main reason prices have risen since the city's successful bid seven years ago, when the budget was estimated at 6.8 billion euros.
Security and labor costs are likely to make the Olympics more expensive. France is providing 45,000 police and soldiers and 50,000 private contractors to secure the Olympics in the Paris area at a particularly tense time in the world. France has also agreed to offer bonuses and other incentives to avoid civil servant strikes.
Not included in the Olympics budget are 1.4 billion euros ($1.5 billion) to make the Seine clean enough to swim in and about 3.5 billion euros ($3.8 billion) to extend the Line 14 metro line before the Olympics – projects that officials say they had planned. It was going to be pursued anyway and was factored into other budgets.
Olympics cost to taxpayers
Even if Paris can't shake off its reputation for Olympic overspending, the games won't burden taxpayers with a legacy of debt that many other host cities face, officials say.
Organizers have said they need 3 billion euros ($3.26 billion) from public funds. This represents 0.1% of France's gross domestic product.
The head of France's national audit agency said the full cost to taxpayers would not be known until after the Olympics but could be between 3 billion and 5 billion euros.
Ratings agency S&P recently downgraded France due to concerns about its debt-to-GDP ratio, but S&P analyst Hugo Soubrier said the Olympics “should not have a significant impact on France's finances.”
Major issues from past Olympics There has been a string of construction projects that have gone way over budget, with the host city having to cover the costs, but with less construction in Paris the risk of overruns has also gone down.
Officials stressed that taxpayer money is going towards infrastructure that will benefit the Paris region beyond just the Olympics, and that the operational part The budget is almost entirely privately funded.
The International Olympic Committee, which receives revenue from major sponsorship deals and broadcast rights, is contributing 1.2 billion euros ($1.31 billion) to the Paris organizing committee. Paris 2024 can also claim revenue from ticket sales, licenses and domestic sponsors, and the French government can claim extra tax revenue from hotels and other tourist spending.
Toboa said the organizing committee was operating on a “spend no more than you make” policy and hoped the strategy would set a new standard.
The benefits of the Olympics
The IOC has proclaimed that hosting the Olympics generates strong economic benefits, though economists counter that the benefits have often been disappointing or unclear.
Organisers say the Olympics will have an “economic benefit” of 3 euros for every euro of public money spent, based on a study commissioned by the IOC and Paris 2024. The Paris region is expected to boost its economy by between 6.7 billion and 11.1 billion euros ($7.27 billion to $12.05 billion) over 17 years, thanks to tourism, construction and Olympic spending.
Paris organizers celebrated this month setting a record with 8.6 million tickets sold, but there are signs tourism may be falling short of expectations. Air France-KLM reported lower traffic as travelers seemed to be avoiding the Olympic crowds and high prices in Paris. Lower-than-expected occupancy rates led some hotels to slash last-minute rates. Meanwhile, Shops and restaurants near the tightly secured Olympic venues have reported sluggish sales.
“Compared to previous Olympics, the economic legacy for Paris is likely to be less significant,” S&P said, noting that while the 1992 Olympics “put Barcelona on the global tourism map,” Paris has been a major tourist destination for many years and is “unlikely to reap the same economic benefits.”
Paris authorities say they have sought to ensure the Olympics benefit local residents, particularly vulnerable communities, beyond tourism, but they have also faced criticism for evicting migrants and homeless people ahead of the games.
France has spent about 1.5 billion euros ($1.63 billion) to build an Olympic village in the poor suburb of Seine-Saint-Denis, which is planned to become a mixed-income housing and engine of urban renewal after the athletes leave.
Authorities said around 2,050 residents of Seine-Saint-Denis were also employed in the construction and preparation of the Olympic and Paralympic venues.
“We are aware that support for these companies in the social and solidarity economy must not end after the Olympic and Paralympic Games are over,” Paris Deputy Mayor Florentin Letissier said in an interview on Tuesday.
Andrew Zimbalist, an economist who has written about the Olympics for years, said the IOC and host cities have long promised to fix the Olympics' finances.
“My first reaction was, I've heard this story before,” he said.
Still, he said there was pressure to cut costs because the IOC could no longer “convince people that this is the greatest thing that could happen to your city and some lessons have been learned.”
Claire Parker contributed to this report.
