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After every other host city dropped out, the IOC just narrowly avoided having to cancel the Olympics.

Paris will host the Summer Olympics in 2024, after they issues a now-or-never ultimatum (Image via ESPN)

The first modern Olympics were held in Athens, Greece, in 1896 with the intention of promoting a spirit of “friendship, solidarity and free play” between nations, “blending sport with culture and education.” Competing in the Olympics is, to this day, the height of athletic achievement, as the Summer Games alone bring together the world’s best athletes in roughly thirty sports to compete in a single, overarching competition.

The location of the games changes with each Olympiad; the host country is given the chance to promote its culture and tradition in front of the world. It is a great honor to be chosen as an Olympic host, and bidding for the Olympic Games has been historically competitive.

Lately, however, financial uncertainties have discouraged many cities from hosting. Preparation for the games includes constructing venue infrastructure, developing hotels and businesses to support the high volume of visitors and hiring staff and officials to run, manage and oversee both specific sporting events and the Games as a whole. It’s a major financial investment.

And there’s no guarantee it will pay off.

Keeping the Olympic Games under-budget seems to be an impossible task. The 2016 Rio Olympics finished at $1.6 billion over-budget, and it was one of the least expensive Olympiads in recent history, with a total cost of $4.6 billion. London’s final cost in 2012 was roughly $15 billion. With this in mind, submitting a bid to host the Olympics is a definite financial gamble, one that fewer and fewer cities are willing to take.

Bids for the 2024 Olympic Games were due in September 2015; at the time of the deadline, five cities were in the mix for consideration. Hamburg, Germany, was the first to opt out, dropping the bid only two months after the deadline. A year later, Rome followed suit. When Budapest dropped their bid this February, only Paris and Los Angeles were left to compete for the honor of hosting the Games.

That’s when things got interesting.

A rendering of the 2028 Los Angeles Summer Olympics (Image via the IOC)

After some subtle hinting from International Olympic Committee (IOC) President Thomas Bach that both the 2024 and 2028 Olympic hosts may be considered simultaneously, Paris issued a now-or-never statement. The 2024 bid would be Paris’ final try, according to three-time Olympic canoeing champion and bid co-chairman Tony Estanguet, who said in a media briefing in February that “this is the fourth bid by Paris and we believe it is now or never. This is the last chance to see Paris bidding for the Games. Afterwards, I think Paris and France will do different things.”

Paris wasn’t the only city with an ultimatum. The Los Angeles committee, while open to the hints of awarding the 2024 and 2028 Olympics simultaneously, ultimately reported that the city would not renew their bid if they came away empty-handed. According to Casey Wasserman, the Los Angeles bid chief, it costs $60 million to place a bid, and those funds have to be raised privately. Raising that much money “is a tough road to go down once,” Wasserman said at the media briefing in February. “I will tell you, twice it is not going to happen.”

These announcements, coupled with the other cities’ decisions to pull out of the running, have led to concern on the part of the IOC for the future of the Olympic Games. If no cities are willing to front the finances to host, the Games cannot be thrown. Fortunately, both Paris and Los Angeles already have a great deal of the necessary infrastructure, which drastically cuts the chance of budget over-runs. By selecting both cities, the IOC can guarantee the immediate future of the Olympics and hope to create a trend of successful Olympic budgeting.

On July 11, the IOC voted to offer the 2024 games and the 2028 games within the same bidding cycle, a move that would give Paris and Los Angeles, the only two cities left in the running, the two Olympiads. The last time two cities were selected simultaneously was over ninety years ago, when the 1924 and 1928 Games were given to Paris and Amsterdam. Following the retirement of Parisian IOC President Pierre de Coubertin, who founded the modern Olympic Games, the 1924 Games were given to Paris while Amsterdam’s bid was pushed to the following Olympiad.

The 2024 situation is much different. Amidst the drama surrounding the Olympic selection, Paris and Los Angeles were able to come to a conclusion. Late last month, the Los Angeles Olympic bid team released an agreement saying that they would host the 2028 Olympics following Paris’ 2024 run. While it still has to be officially approved at the IOC convention in Peru next month, there is little doubt this is exactly what the IOC had in mind.

Los Angeles’s agreement to postpone their Olympic involvement until the 2028 Games didn’t come without negotiation, however. In exchange for the delay, the IOC has agreed to advance funds to the organizing committee to account for the extended planning period. These funds, which could exceed $2 billion, will be used to renew sponsor agreements and develop new marketing campaigns, as well as to promote youth sports in the city.

A major consideration in hosting the 2028 Olympic Games instead of the 2024 Games is an extra four years of contingency planning. The possibility of a natural disaster, financial recession or anything else that could lead to unforeseen expenses is greatly increased over an additional four years. Fortunately, Los Angeles’ reliance on existing infrastructure, such as the Staples Center and the Coliseum, should reduce cost variances, and the $487 million contingency fund built into the Olympic bid is also an important factor.

As a whole, it seems as if all parties are satisfied with the decision to name two winners; the decision marks major Olympic milestones for both Paris and Los Angeles. Paris will have the chance to host the 2024 games exactly one hundred years after their last Olympics, which were in Paris in 1924. Los Angeles, home of the 1932 and 1984 Games, will bring the Summer Olympics back to the United States for the first time in thirty-two years. Paris and Los Angeles will both join London as the only cities to have hosted the Games on three separate occasions.

While host sites have now been chosen for the next three Olympiads (Tokyo in 2020, Paris in 2024 and Los Angeles in 2028), the tendency toward cost over-runs and the decreased interest from potential host cities is inviting concern for the future of the Olympics. What will happen if there are no valid hosting bids? Could the Olympics get canceled? If they do, what will happen to sports that depend on the Olympics for international credibility? Will the positive international politics associated with the Games cease to exist?

The Olympics are important for more than simple athletic competition, and it’s looking like they could be in jeopardy in the near future. With this in mind, lots (and lots and lots and lots and lots!) of people are calling for a permanent home for the Games—one site that can be used repeatedly. It’s a great idea, and one could potentially happen in the not-so-distant future. If this doesn’t work out, however, hopefully Paris and Los Angeles’ highly cost-sensitive bid plans can prove to the world that hosting the Games doesn’t have to send a city into debt.

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