Boston 2024 details insurance plan; but what if stadium developer pulls a Filene's Hole?

Boston 2024 today released details of its plans to spend more than $100 million on insurance to cover the risks of a hurricane hitting Boston during the Olympics, terrorists striking the games, sponsors dropping out, ticket sales proving disappointing or entire countries boycotting the games.

The proposal does not cover any cost risks associated with overruns in building an Olympic stadium at Widett Circle or an athletes' village on Columbia Point, but Boston 2024 says taxpayers will be protected through "transfer of risk to private sector in capital project development," that is, private developers will be handed large chunks of land - and associated risks - at the two locations to build Olympic facilities in exchange for being allowed to build mega-developments on the land before and after the games.

Boston 2024 says it doesn't need to buy insurance to cover any overruns - or assume costs should the developers go bankrupt or fail to build the facilities in time - because the developers would have to buy their own insurance and take out bonds:

In addition to diligent scope management, Boston 2024 will also drive a thorough construction procurement process to ensure the selection of developers, contractors, and subcontractors that have solid financial backing and, in the case of every venue contract, deploy important contracting techniques (e.g. guaranteed maximum price). Developers and contractors will also be required to purchase additional protections, including surety and performance bonds on all projects. On large‐scale projects (like Widett Circle and Columbia Point), to the extent necessary to provide further financial certainty or fill gaps in sureties, if any, capital replacement insurance will also be required. As a result, approximately 85% of total construction costs are segregated and covered separately by both private developer and umbrella insurance. The remaining 15%, concentrated in venue‐related costs, are projects that are smaller in scale and scope that will have developer‐backed insurance and be funded from operating budget revenue.

Neighborhoods: 

Topics: 

    Free tagging: 

    AttachmentSize
    PDF icon Boston 2024 risk plan241.73 KB

    Comments

    Trust Us

    The final cost of the Big Dig is $2.1B. Matt Young is what this team needs to put us over the top. Boston Schools are improving every day. A black guy shot Carol Stuart. Sure, I will respect you in the morning. We do not need insurance for cost overruns.

    up
    Voting is closed. 32

    Matt Young

    By on

    That's funny.

    up
    Voting is closed. 11

    How

    is it that only some of us see this as a major problem?

    private developers will be handed large chunks of land - and associated risks - at the two locations to build Olympic facilities in exchange for being allowed to build mega-developments on the land before and after the games.

    up
    Voting is closed. 40

    Dont know tbh

    But this whole olympic shindig is some serious dystopian bullshit

    up
    Voting is closed. 17

    How do I get in

    By on

    I would like someone to hand me some large chunks of land. I'll take that risk - like the developers do - with other people's money after carving out a generous hunk for myself. Making money in real estate is not rocket science when you get the land for free or at least on the cheap.

    Why should the city effectively give away this land? The developers can buy it - and within reason and approval of the appropriate authorities, they can build what is permitted. Managing the associated risks are what they do for a living and how they make money - not something we need to pawn off on them for free.

    up
    Voting is closed. 34

    How are tax breaks not

    By on

    Boston residents picking up the tab? If "normal" development was allowed the city would be collecting taxes that would be used to fund the city.

    up
    Voting is closed. 31

    It's the same in everything

    It's the same in everything but name.

    Boston 2024 is to "Boston residents won't be stuck with the tab" as Bill Clinton is to "I did not have sex with that woman."

    up
    Voting is closed. 8

    Those who forget the past

    The Big Dig was the most expensive highway project in the US, and was plagued by escalating costs, scheduling overruns, leaks, design flaws, charges of poor execution and use of substandard materials, criminal arrests,[2][3] and one death.[4] The project was originally scheduled to be completed in 1998[5] at an estimated cost of $2.8 billion (in 1982 dollars, US$6.0 billion adjusted for inflation as of 2006).[6] However, the project was completed only in December 2007, at a cost of over $14.6 billion ($8.08 billion in 1982 dollars, meaning a cost overrun of about 190%)[6] as of 2006.[7] The Boston Globe estimated that the project will ultimately cost $22 billion, including interest, and that it will not be paid off until 2038.[8] As a result of the death, leaks, and other design flaws, the consortium that oversaw the project agreed to pay $407 million in restitution, and several smaller companies agreed to pay a combined sum of approximately $51 million.[

    If there was ever a politician I want to see perp walked, it's the penis that walks erect that is Marty Walsh. Even funnier was Rich Davey in the Herald.

    Boston 2024 CEO Richard Davey defended the mandated so-called Olympic Route Network, saying the private lanes, which would only be in use when needed, have “proven to be efficient for the Olympics and also proven to be fairly innocuous for the city residents.”

    Davey also predicted that congestion will be avoided because people who don’t have to drive will stay off the roads during the Olympics and summer traffic is typically lighter.

    “We looked at other Olympics Games over the last 20, 30 years, and every city’s experienced a drop in traffic somewhere 
between 5 and 50 percent,” 
Davey said.

    “We also know just based on (state) traffic counts in and around the city of Boston that, in the summertime, traffic falls by about 10 percent.”

    Mr.Davey obviously hasn't been down the Southeast Expressway at 2:30 in the afternoon lately.

    Crooks. Every single one of them.

    up
    Voting is closed. 38

    Fixed.

    Mr.Davey obviously hasn't been down the Southeast Expressway anywhere in the city at 2:30 in the afternoon most times of the day lately.

    up
    Voting is closed. 26

    "Private lanes"??!!? You mean

    By on

    "Private lanes"??!!? You mean the streets paid for by the PUBLIC? Call me crazy but I think the tax payers who paid for those lanes should get to use them. Of course Richard Davey is for them since he gets to (ab)use them. Can we catapult him out of town?

    up
    Voting is closed. 21

    Imagine

    the looks on people's faces as they watch as so called VIP's whiz through while they're baking in the extra traffic that whore Davey says doesn't exist. A lane their tax dollars will pay for that they won't have access to.

    Think Shirley Leung will have access?

    up
    Voting is closed. 22

    She'll Be Up Front

    Full B24 adaptation of a Dallas Cowboys Cheerleader costume on her, Pom poms waving while John Fish and Pags pass out from all the money they've made from this.

    up
    Voting is closed. 10

    please

    By on

    No no no no to this visual!!!!

    Now Davey on the other hand, I'd pay for him to have a Cheerleader costume on. It would just be funny to see.

    up
    Voting is closed. 15

    Are "penis" and "whore" really necesary

    By on

    Are the epithets "penis that walks" and "whore" really necessary to shore up your arguments?

    Don't get me wrong, otherwise, I largely agree with your opinions, but the school-yard name-calling makes you look like a school child.

    Or, are you just serving up the quality of internet discourse you think I deserve?

    up
    Voting is closed. 12

    What offends you more?

    My language or what these thieves who masquerade as honest public servants are trying to slip by the taxpayers?

    As I stated previously, these hypocritical douchebags are undeserving of anything resembling civil criticism. Do you really think if I could address the ignorant bagman that plays at being Mayor personally I would temper my language? Would you want me to?

    up
    Voting is closed. 15

    Maybe we can get those

    By on

    Maybe we can get those highway-blocking protestors to have some fun with these private lanes...

    up
    Voting is closed. 8

    "Private lanes" are a non starter.

    By on

    This was discussed early on at BMG. It's easily one of the more egregious impositions.

    The IOC expects to commandeer elements the road grid for its exclusive use. While that might work in autocratic despot nations or places with lots of room to give up, it's obviously ridiculous here.

    The fact that the 2024 yokels were so glib about such a huge imposition was the tip off that they are unfit to be submitting this thing and Boston is unsuited to host it. And that is just one of many asinine things the IOC expects that makes opposition as easy as shooting Fish in a barrel.

    up
    Voting is closed. 10

    In Atlanta....

    ... most office workers in affected areas (like downtown) were basically told to take vacation or to work at home for the entire duration of the Olympics -- in order to clear the decks for Olympic traffic. We were allowed to come in once a week to drop off and pick up work. Most people complied -- as a result the amount of traffic was far less than normal most of the time.

    up
    Voting is closed. 12

    It's nice

    To have perspective from someone who went through summer games in another US city. That would make a lot of sense to an extent, but with many of the venues being around or on direct routes to universities (granted they would be in less populated summer sessions), residential areas, and hospitals, I'm not sure how helpful making everyone work from home would be here.

    Also, I can't really picture this city responding very well to being told what to do. Personally, I'd much rather vacation on my own schedule instead of being run out of my own city by the Olympics. Can you imagine what the roads OUT of town would be like, or how insanely high airfare would skyrocket?

    up
    Voting is closed. 12

    Based on our past experience...

    ... my wife are very strong Olympics NON-supporters. I think cybah was also in the Atlanta area then -- and he didn't like them any more than we did. (My wife practically lived at work -- as she worked at the Atlanta History Center -- around 16 hours a day, seven days a week), during the Olympics).

    up
    Voting is closed. 14

    Hospitals

    By on

    Seriously. Look where Mass General is located. Will we all be told to postpone our life-threatening illnesses, too? Cancer treatments require a daily commute but, you know, too bad because, Olympics!

    up
    Voting is closed. 13

    Is it just me...

    By on

    Is it just me, or is all the insurance there to protect Boston2024 and it's backers, not the taxpayers of Boston and the Commonwealth?

    up
    Voting is closed. 32