Is this a great country or what? A millionaire developer wants a
road built, the federal government supplies the cash to
construct it. A billionaire ski-resort owner covets a choice
piece of public land. No problem. The federal government
arranges for him to have it. Some millionaire businessmen stand
to profit nicely if the local highway network is vastly
improved. Of course. The federal government provides the money.
How can you get yours, you ask? Easy. Just help your hometown
land the Olympics. Then, when no one's looking, persuade the
federal government to pay for a good chunk of the Games,
including virtually any project to which the magic word Olympics
can be attached.
For the past few years, while attention was focused on the Great
Olympic Bribery Scandal--in which Salt Lake City boosters
dispensed as much as $7 million in gifts, travel, scholarships,
medical care, jobs and other goodies to IOC members (and their
relatives and companions) to ensure that Utah's capital city
would be chosen to host the 2002 Winter Games--private and
public interests have siphoned an estimated $1.5 billion out of
the U.S. Treasury, all in the name of those same Olympics. Two
months before the Games, Utah has already walked away with the
gold while setting records in four categories:
Total federal handouts. The $1.5 billion in taxpayer dollars
that Congress is pouring into Utah is 1 1/2 times the amount
spent by lawmakers to support all seven Olympic Games held in
the U.S. since 1904--combined. In inflation-adjusted dollars.
Enrichment of private interests. For the first time, private
enterprises--primarily ski resorts and real estate
developments--stand to derive significant long-term benefits
from Games-driven congressional giveaways.
Most government entities tapped for cash. With all the skill,
grace and precision of a hockey team on a power play, Utah's
five-member congressional delegation has used the Olympics to
drain money from an unprecedented number of federal departments,
agencies and offices--some three dozen in all, from the Office
of National Drug Control Policy to the Agriculture Department.
Most U.S. tax dollars per athlete. Federal spending for the Salt
Lake City Games will average $625,000 for each of the 2,400
athletes who will compete. (Not a penny of it will go to the
athletes.) That's a 996% increase from the $57,000 average for
the 1996 Atlanta Olympics. It's a staggering 5,582% jump from
the $11,000 average for the 1984 Summer Games in Los Angeles.
Again, these are inflation-adjusted dollars. (If the minimum
wage had gone up at the same pace since '84, the average
McDonald's hamburger flipper today would earn $190 an hour.)
Although the Olympics have grown tremendously in scale since
Lake Placid staged the first U.S.-hosted Winter Games, in 1932,
it is worth noting that local and state folks footed the entire
bill for that event. The town of North Elba, N.Y. (population at
the time about 6,500), which includes the village of Lake
Placid, issued $350,000 in bonds to help build Olympic
facilities that included the nation's first bobsled run--this at
a time when the country was struggling through the Great
Depression. Thirty-five years later, in 1967, the townspeople
finally paid off the bonds at a total cost of $1 million,
without any federal assistance.
Such self-reliance has not been in evidence in Utah. Salt Lake
City and surrounding communities (combined population: 1.6
million) did not float any bonds for construction of Games
venues. In 1989 Utah did earmark 1/32 of state sales tax revenue
over the next 10 years (a total of $59 million) to help pay for
several venues, but the Salt Lake Organizing Committee (SLOC),
the tax-exempt organization putting on the Games, is required to
pay that money back by March 2002. In Washington, meanwhile,
Utah's politicians are still wringing Olympics-related money out
of Congress, with another $116 million (and still counting)
salted away in President Bush's first budget.
This is not to say that the recipients are unappreciative. Mitt
Romney, SLOC's president, has acknowledged the U.S. government's
contribution by saying, "We couldn't have done it without them.
These are America's Games."
Actually, they aren't. Cities--not countries--bid for the
Olympics, though you wouldn't know it from the bill passed along
to U.S. taxpayers. The heavy dependence on federal funds began
with the Atlanta Games, for which Congress kicked in $610
million, eight times the $75 million allocated for the L.A.
Olympics. Salt Lake City has taken the federal funding to a new
level of excess. What, exactly, are your tax dollars buying?
Here's a sampling.
--Parking lots are costing you $30 million. Some $12 million of
that is paying for two 80-acre fields to be graded and paved for
use as two temporary lots, then returned to meadows after the
flame is extinguished.
--Housing for the media and new sewers are each costing you $2
--Repaved highways, new roads and bridges, enlarged interchanges
and an electronic highway-information system are costing you
--Buses, many brought in from other states, to carry spectators
to venues are costing you $25 million.
--Fencing and other security measures at the Veterans
Administration Medical Center in northeast Salt Lake City--to
protect patients and staff from the Olympic hordes--are costing
you $3 million.
--A light-rail transit system that will ferry Olympic visitors
around Salt Lake City is costing you $326 million.
--Improvements at Salt Lake City-area airports are costing you
--Infectious-disease monitoring, food inspection and mobile
medical response teams--aside from those specifically related to
bioterrorism threats--are costing you $11 million.
--Testing programs to try to assure a drug-free Olympics are
costing you $3 million.
--Increased services provided by the U.S. Forest Service, the
Postal Service, the Interior Department and the State Department
are costing you $16 million.
--Recycling and composting are costing you $1 million, and public
education programs for air, water and waste management are
costing you another $1 million.
--A weather-forecasting system being set up for SLOC is costing
you $1 million. The money is going to the University of Utah to
enable its Meteorology Department to provide data that will
supplement forecasts provided to SLOC by the National Weather
Service. According to a SLOC press release, "the Olympics
presents a wonderful opportunity [for the department] to perform
a much valued service, while at the same time [helping its
faculty fulfill its role] as teachers and researchers."
--New trees planted in Salt Lake City and other communities
"impacted," as the funding legislation put it, by the Olympics
are costing you $500,000. Said Utah senator Robert Bennett, who
arranged for the money, "We do the Olympics because it gets us
together doing things like planting trees."
--Security is costing you about $240 million. Given the events
of Sept. 11, few people would quibble with so large an outlay
even though it's a 150% increase over the federal tab for
safeguarding the Atlanta Games, which had twice as many venues
and four times as many athletes to protect. What's surprising is
that $200 million of this was approved before Sept. 11. Less
than 24 hours before the attacks, in fact, Romney was in
Washington seeking $12.7 million to cover a portion of salaries
and expenses for Utah police who will be involved in Games
To be sure, at least a few of these federal dollars would have
found their way to Utah even if there were no Olympics. Such is
the case with some of the money spent on highway improvements.
However, because the work on those was put on a fast track,
similar projects were shelved in other cities and states. Thus
taxpayers elsewhere not only subsidized the Salt Lake City Games,
but also lost out because highway work in their own areas was
Why the federal government should have to pay for so many
goodies--U.S. taxpayers aren't asked to build temporary parking
lots for Super Bowl cities, for example, or fund NBA drug
testing or create special weather-forecasting units for the
World Series--remains a mystery. There is little doubt, though,
as to who will benefit: Utah, SLOC and a number of wealthy
businessmen who have deftly played the Olympic money game.
C.C. AND COMPANY
A new road that enhanced the value of Clinton Charles Myers's
real estate investments cost U.S. taxpayers $3 million, which
came on top of the $2 million in other federal money that built
another road that benefited Myers.
Clinton Charles Myers? You may not recognize the name, but
Myers, 63, is a contractor from Rancho Cordova, Calif., who has
developed land abutting Utah Olympic Park, site of five of the
Games' 15 sports. He is only one of the businessmen positioned
to profit from the federal tax dollars lavished on the Olympics.
Robert Earl Holding, a 75-year-old oil billionaire--ranked 236th
on the Forbes 400 list of richest Americans--and owner of
Snowbasin, a ski area that will host the downhill, Super G and
Ian Cumming, 61, chairman of a holding company, whose family owns
Park City Mountain Resort, which will be the venue for
snowboarding and giant slalom skiing.
Edgar Stern Jr., a 79-year-old hotelier and majority owner of
Deer Valley, site of freestyle and slalom skiing.
Roger Penske, a 64-year-old racing-car magnate and minority
owner of Deer Valley.
Myers, or C.C., as he's known, may be the most colorful of the
bunch. Standing 6'5" without his ostrich-skin boots on and
weighing almost 300 pounds, he became a California folk hero in
1994 when his construction company rebuilt a stretch of the
Santa Monica Freeway--heavily damaged by that year's Northridge
earthquake--10 weeks ahead of schedule. The feat earned him
deification by Rush Limbaugh and a $14.8 million bonus from the
In the summer of 1990 Myers took a majority stake in a newly
formed partnership called the Summit Ranch Joint Venture, whose
goal was to develop a 1,136-acre tract on and adjacent to a
mountain at Kimball Junction in Utah. This was no ordinary
mountain: Only a few weeks earlier the state had selected it as
the site of a winter sports park that would include ski jumps
and a bobsled and luge run. The facility would become Utah
In October 1990, in what was hailed as an act of great
generosity, Myers signed an agreement with Utah officials to
give 386 acres of his partnership's tract to the Summit County
Municipal Building Authority as the site for the sports park.
The gift, however, had strings attached. In exchange for the
property the Utah Sports Authority, a state agency overseeing
construction of Olympic facilities, agreed to build an access
road to the sports park that would run through Summit Ranch's
remaining 750 acres, opening the area to the development of
single-family homes and condos. In addition the sports authority
pledged to install "all necessary utilities, including
electrical power, natural gas, telephone, water system and
sewer," to serve both the sports park and the 700 residences
proposed by Myers.
But how to pay for a road for a private developer so that the
funding wouldn't look like Olympic money? Or worse, wouldn't
be--or even appear to be--state tax dollars? Not to worry. Cash
was available from the Utah Permanent Community Impact Fund. The
source of the fund's money: the federal government.
The U.S. Treasury collects royalties from mining and petroleum
companies that prospect and drill on federal lands, and from
individuals and businesses that buy and sell the related leases.
The Treasury returns half the payments to the states where the
lands are located. States generally distribute the money as
grants or loans to those communities that have been socially or
economically affected by prospecting or drilling. In Utah this
money traditionally has gone to struggling counties to help with
public needs, like purchasing a fire truck.
Now the state was going to give $2 million in federal royalties
to Summit County--by far the state's richest county, and one in
which a majority of the mines closed years ago--and the money
would be in the form of an outright grant rather than a loan,
even though the fund's rules state that grants can be made "only
when the other financing mechanisms cannot be utilized, where no
reasonable method of repayment can be identified, or in
emergency situations regarding public health and/or safety." On
top of that the grant was earmarked for construction of a road
that would benefit a private developer.
The state's Olympic partisans seemingly sensed the danger for
negative publicity if there was a paper trail from the grant to
Myers's road. To avoid that pitfall, Utah's finance division,
with the agreement of Summit County officials, dumped the $2
million into a pool of other state money that was to be used to
build the winter sports park. Now the grant dollars were no
longer traceable--even if the intent remained firmly on the
record. Furthermore, there would be no annoying breakdown of how
the money was spent. In an internal memo state finance director
Gordon Crabtree wrote, "Since the $2 million grant will be
pooled with these other revenue sources, budgeted expenditures
for the grant are not applicable."
One obstacle remained to the speedy construction of the two-mile
access road, to be known as Bear Hollow Drive. If the Utah
Department of Transportation, the state agency responsible for
highway construction, handled the job, it could insist on
building the road to meet both county and state standards, a
costly requirement. Again, not to worry. The Olympics make all
The Utah Sports Authority assigned responsibility to the state's
Division of Facilities Construction & Management, an agency that
builds buildings, not highways. The result might have been
anticipated: a winding, two-lane road with grades exceeding
county standards and prone to slides and sinkholes.
The road paid off handsomely for Myers and his partners. County
assessment records show that in 1990 the Summit Ranch land was
valued for tax purposes at about $3 million. Ten years later the
land alone--excluding the houses that had been built--was valued
at $48 million, a sixteenfold increase. In the last year sale
prices for homes in the partnership's development, known as Sun
Peak, have ranged between $320,000 and $1.5 million.
A spokeswoman for Myers, Linda Clifford, a C.C. Myers Inc.
executive who managed the project, told SI that "whatever the
assessed value is now, it's because homes have been built there.
People have bought lots and built homes, and that's why there's
an assessed value of [$48 million]."
As for Bear Hollow Drive, Clifford said, "The only reason that
there was a road on the property was that [we gave] the property
to the state at no charge. For nothing. Zero. So it could put
the jumps and the bob and luge and everything in there, and the
state owns that property now and has been using it for quite
some time, and it is a public attraction."
The value of Summit Ranch development was further enhanced in
1999, when a second access road was built into Utah Olympic
Park. This three-mile stretch cost U.S. taxpayers $3 million.
The second road will benefit not only Myers, in part by
diverting sports-park traffic around his development, but also
the most powerful organization in Utah: the Church of Jesus
Christ of Latter-day Saints. The church's real estate arm,
Property Reserve Inc. (PRI), owns 430 prime acres through which
the road runs, a tract long coveted by developers for its
gorgeous mountain backdrop (which now includes the ski jumps)
and its proximity to Park City (10 minutes) and other nearby
Shortly after the asphalt was laid for this road, PRI presented
plans to Summit County authorities for an ambitious development:
994 single-family homes and town houses, nearly one million
square feet of commercial space, an office campus and a town
center with its own main street, school and library. No one
knows how soon construction will begin. The one certainty is the
role of the federally built road. It is the spine of the
development, the feeder from which everything else flows.
INTERSECTION OF INTERESTS
Utah has used $13 million in federal money to rebuild the
Kimball Junction exit off I-80. The reconstruction has come
complete with artwork. Colorful bas-reliefs on the walls of the
underpass, depicting various winter sporting events, pay homage
to the Olympics. Unfortunately, except for the occasional
motorist who stops to change a tire, few will get to appreciate
the murals. It's hard to study them while whizzing by at 65 mph.
More significant, while the revamped interchange should ease
congestion during the Games--Utah Olympic Park is less than a
mile from the exit--in the long term it will facilitate travel
to Park City, Deer Valley and other resorts and developments,
among them Myers's, the Mormon Church's and one backed by Norman
Bangerter, a former governor. Park City and Deer Valley are both
enthusiastic about the federally funded roadwork.
Says a spokeswoman for Deer Valley, "It helps with the locals
coming up from Salt Lake and destination skiers coming in from
the airport. [The interchange] makes it a lot easier to get to
our resort. Everything [all the work going on to prepare the
state for the Olympics] has been positive. Not only for the
local investment, but also because it gets our name out and
people see what an amazing resort Deer Valley is."
Echoes a spokeswoman for Park City, "We're hoping to ride the
coattails of the Olympics. It's publicity we've dreamed of.
We're only 35 minutes from this airport that has benefited from
Deer Valley, which Stern began developing in 1981 on the site of
a onetime mining camp, has seen its reputation soar on the eve
of the 2002 Olympics. This year a Ski magazine survey named it
North America's top resort, displacing perennial titleholder
Vail. The magazine noted that Deer Valley has "snow like brushed
velvet and food fit for a royal court" and boasts one employee
for every three visitors.
Park City owner Cumming did not enter the ski-resort business
until seven years ago, when Salt Lake City was 14 months from
winning the 2002 hosting rights. He had worked hard to help the
city land those rights. Cumming, who is chairman of Leucadia
National Corp., a publicly traded holding company with interests
in insurance, banking, mining, real estate and winery
operations, was chairman of the Utah Sports Authority in 1990
when that agency cut its deal with Myers for the Sun Peak
land-road exchange. The agreement paved the way for construction
of the ski jumps and the luge and bobsled track to help persuade
the IOC to award Salt Lake the Winter Games.
In April 1994, with facilities under construction at Kimball
Junction and the IOC's site selection looming, Cumming purchased
control of the Park City Mountain Resort and a ski resort in
California for $42 million from Nick Badami, a SLOC trustee.
Cumming folded the properties into a new company called Powdr
Corp., the ownership of which he handed over to his sons, John
In June 1995 the IOC voted to award the 2002 Games to Salt Lake
City. That same month SLOC formally designated Park City a venue.
Although Cumming had stepped down as chairman of the sports
authority in October 1991, he retained close ties to Salt Lake
Olympic organizers. Badami, who remained a SLOC trustee,
continued his association with the Park City resort as Powdr
Corp.'s chairman. Frank Joklik, a director of a mining and
exploration firm controlled by Cumming's holding company, was
chairman of the bid committee when Salt Lake was awarded the
Games and later served as SLOC president.
Cumming, Stern, Myers and others like them are peculiar to the
Salt Lake Olympics. No federal tax dollars were spent to
significantly increase the long-term value of private business
interests in Los Angeles, Atlanta or Lake Placid, site in 1980
of the last Winter Games held in the U.S. In fact, 21 years
after those Lake Placid Games, there are no million-dollar
condos surrounding the Olympic venues in New York State. No
private ski resorts. No upscale restaurants. No fancy lodges.
SHAKING THE MONEY TREE
It is no secret how Utah has reaped a bounty from the 2002 Games.
"We are, without shame, using the Olympics to try to get federal
funds," the head of the state's department of transportation, Tom
Warne, told a reporter after a day of lobbying in Washington in
1997. "We've designed a strategy to separate Utah from the 49
Utah's five-man delegation to Capitol Hill may be small, but it
is well-positioned, through committee assignments and seniority,
to funnel pork back home. Representative Merrill Cook, a
Republican who represented a Salt Lake City district in the late
1990s, was a member of the House Transportation Committee and
used the Games as leverage to win huge increases for Utah
highway and transit projects.
In 1998, for example, he helped push through a $75 million hike
in federal money for Utah highways. Shifting the cost of the
Games to taxpayers elsewhere was good news for Utah. "It means
any talk of a tax increase at home has been laid to rest," said
Cook. In what should have won him a gold medal for chutzpah,
Cook told the Deseret News that he had obtained additional
dollars by stressing the state's "great burden of hosting the
2002 Winter Games on America's behalf."
Over in the Senate fellow Republican Bennett, a member of the
Appropriations Committee, has been even more effective in
delivering federal funds, for everything from light-rail cars to
the weather-forecasting unit. In a 1998 appropriations bill he
wrote in language permitting the Secretary of Transportation to
use discretionary funds for the Games. "If Utah hadn't had
somebody on Appropriations, there is no way a lot of that would
have gotten through," says one Senate staffer.
Bennett frequently bypassed the Commerce Committee, which should
have had jurisdiction over Olympic funding. The practice so
angered fellow Republican senator John McCain of Arizona, then
chairman of the committee, that in 1998 he began asking Bennett,
repeatedly, to provide Congress with an estimate of "how many of
the taxpayers' dollars are going to be needed to fund the
Olympics." Three years later McCain is still waiting for an
answer. (Last week Bennett offered an answer of sorts, in the
form of a General Accounting Office audit; see box, page 87.)
In addition to being represented on crucial committees, Utah has
profited enormously from the influence exercised by Republican
senator Orrin Hatch, dean of the state's congressional
delegation. As one of the Senate's more senior members, Hatch, a
master of legislative manipulation and backroom deal-making, has
ardently advanced and protected his state's Olympic agenda.
The irony in the flow of cash to the Beehive State is that
Utah's congressional delegation has a history of opposing
federal spending on projects that specifically benefit other
states. The delegation has even opposed federal spending on
Winter Olympics when those Games were held someplace other than
Utah: Former Utah congressman Koln Gunn McKay, a Democrat, not
only voted against federal funds for the 1980 Lake Placid Games
but also was one of only four members of the House who voted
against endorsing Lake Placid as the site for the Olympics. For
all it has been asking from Washington, Utah contributes less to
the U.S. Treasury than most other states. In 1999 individuals
and families in Utah paid on average $6,600 in income tax, well
below the national average of $9,000.
Yet Utah's congressmen have delivered for their state. Many of
the Olympic outlays have sailed through the House and Senate
because Utah's representatives buried them in huge spending
bills. Typical was an item in a 1999 measure appropriating funds
for scores of projects, from renovating a Head Start facility in
Alabama to constructing a center for disabled preschool children
in New York City. Tucked amid page after page of tiny type was
this: "$1,000,000 million [sic] to the Salt Lake City Organizing
Committee for housing infrastructure improvements for the
Olympics and Paralympics."
A million dollars here, a million dollars there--who will
notice? Not a lot of Congressmen from the other 49 states, it
seems, and certainly not the average American taxpayer.
THE LAND GRAB
Earl Holding is an oilman (Sinclair Oil Corp.), hotelier (Little
America), ski resort proprietor (Sun Valley, Idaho), rancher and
one of the country's largest landholders. He owns about 500,000
acres in Utah, Wyoming, Montana and other western states and
rents, on the cheap, thousands more acres from the U.S.
government for ranching. He also may be the biggest single
beneficiary of Utah's landing the Olympic Games.
Beginning with his first venture, in the 1950s, a money-losing
truck stop near Green River, Wyo., that he turned around,
Holding has displayed a Midas touch in business dealings. One
notable exception: Snowbasin, a picturesque ski area in the
Wasatch Mountains 35 miles north of Salt Lake City that he
bought in 1984. Long a popular destination for day trips,
Snowbasin was a throwback to the time before fancy restaurants,
shops and condos transformed skiing. You went to Snowbasin for
one purpose: to ski. Its magnificent slope, with its
breathtaking views and harrowing descent, made it a favorite of
Holding had bigger plans. He wanted to expand Snowbasin into a
luxurious resort that would rival Park City and Deer Valley. He
envisioned palatial homes, lavish lodges, restaurants, riding
trails, even a golf course, on hillsides where elk and moose
roamed. There was one obstacle, though: The U.S. government
owned all the land he wanted.
The U.S. Forest Service took title to the land in the 1940s
after cattle ranchers nearly destroyed it through overgrazing.
Erosion and landslides had dumped silt into streams, polluting
tributaries supplying Ogden, 17 miles to the west. After the
state condemned Ogden's water supply, the Forest Service
reversed the damage. Over the decades foresters brought the
mountain back to life with trees and vegetation, turning it into
a mecca for outdoorsmen and wildlife. In 1985 Holding proposed a
land exchange with the Forest Service, asking for 2,500 acres at
the base of the mountain to develop a year-round resort. In
return he would deed to the Forest Service other parcels he
owned in Utah.
The Forest Service, however, opposed turning this pristine
acreage into a development. Forest Service supervisor Arthur
Carroll wrote Holding on May 19, 1986, "As managers of these
National Forest lands, we feel it would not be prudent on our
part, nor within the scope of our authority, to support the
exchange of National Forest lands for commercial real estate
development other than that needed to provide for downhill
The service did not entirely shut the door on an exchange. It
pledged to work with Holding to negotiate a much smaller trade,
of about 200 acres. That would have been more than enough for a
new day lodge, restaurants and service buildings. But Holding
Through his privately owned Sinclair, Holding countered with a
proposal to develop Snowbasin as a destination resort and scaled
back his request to 1,320 acres. Still, the Forest Service
objected. "I cannot in good conscience dispose of public land
for that purpose," Wasatch-Cache forest supervisor Dale Bosworth
wrote Holding in February 1990. After more lobbying by Holding,
the Forest Service agreed to increase the exchange to 700 acres.
Still not enough: Holding insisted on his 1,320 acres--slightly
more than two square miles.
Several years would pass before he got the opportunity he was
looking for. Like Cumming and other prominent Utahans, Holding
worked closely with the bid committee to bring the Olympics to
Salt Lake City. He made his private jet available to the
committee. Visiting IOC dignitaries stayed at his Little America
Hotel while in Salt Lake.
More significant, Snowbasin was being developed as a site for
skiing events, should Salt Lake win the Games. The bid
committee's David Johnson wrote Marc Hodler of Switzerland, then
an IOC vice president and president of the International Ski
Federation, in October 1994: "Mr. Holding and his construction
crews...are committed to do as much as they can before the snow
flies this year in the Snowbasin area.... We are very pleased
with the enthusiasm that Mr. Holding has, not only for the
project at Snowbasin, but for our Olympic bid."
Three months after the IOC selected Salt Lake City to host the
Olympics, Holding made his move. Except this time he bypassed
the Forest Service and went directly to his friends in Congress.
In September 1995 James Hansen, a Republican representative from
Utah--and, fortuitously, chairman of the House Subcommittee on
National Parks, Forests and Lands--introduced the Snowbasin Land
Exchange Act in the House "to authorize and direct the Secretary
of Agriculture and the Secretary of the Interior to exchange
1,320 acres of federally owned land within the Wasatch National
Forest...for lands of approximately equal value owned by the Sun
Valley Company. It is the intent of Congress that this exchange
be effected without delay."
A month later Hatch introduced virtually identical legislation
in the Senate. It was only fitting that he would be Holding's
sponsor. At a public meeting in Ogden in 1990, Hatch had berated
the Forest Service for dragging its feet on Holding's
application. Hatch reportedly summoned a regional Forest Service
official, Stan Tixier, in front of the audience to put him on
the spot. Tixier recalled, "Orrin said if there was a county
official that supported the decision [not to make the land swap
with Holding], he would like to know who he was because he
wanted to kill them." Hatch went on to label the decision
"dumb-assed and boneheaded" and said anyone who felt differently
was a "Neanderthal."
To drum up support, the Utah congressional delegation and Salt
Lake Olympic boosters warned lawmakers that two Olympic showcase
events might be jeopardized if Congress didn't approve the
exchange. "Snowbasin is slated to host the men's and women's
downhill events as well as the Super G events for the 2002 Winter
Games," Hansen told colleagues in September 1995. "This equal
value exchange is necessary to accommodate those events."
SLOC chairman Joklik agreed, stressing the need to move fast.
"Construction of the base facilities requires completion of the
land exchange between the U.S. Forest [Service] and the owners of
the resort," Joklik told a Senate subcommittee in November of the
same year. "It is important to note these changes need to be in
place well before 2002 to accommodate other international skiing
events and to resolve any problems prior to the Olympic Games."
If Utah has the Greatest Snow on Earth, as the state brags, then
this was the greatest snow job on earth. Snowbasin didn't need
1,320 acres of national forest land for the Olympics. It
required perhaps 100 acres at most. That would have been plenty
for day lodges, service buildings, parking lots and viewing
stands. If past Olympic practice had been followed, no land swap
would have been necessary at all. In 1960, when Squaw Valley,
Calif., hosted the Winter Games, the Forest Service granted a
special-use permit allowing the Olympics to be held on national
Holding, though, had something going for him more potent than
precedent. He had access. In addition to helpful lawmakers
Holding got an assist from elsewhere in Washington, from a
leading Forest Service officer, Gray Reynolds. A former chief
forester in Utah, Reynolds, a deputy director of the Forest
Service, took on the task of drafting crucial sections of the
On Nov. 12, 1996, President Clinton signed the Omnibus Parks and
Public Lands Management Act expanding national parks and
safeguarding other natural resources, a move the President said
would "put nature within reach of millions of families." Clinton
pointed to the Presidio in San Francisco, Sterling Forest on the
New York-New Jersey border and the Tallgrass Prairie National
Preserve in Kansas as lands to be preserved or restored. Clinton
made no mention of section 304 of the act, which ordered the
Forest Service to carry out the Snowbasin land exchange "without
delay." After a decade Earl Holding finally had the land for his
future development--courtesy of the Olympics.
Four months later, in February 1997, Reynolds retired from the
Forest Service, and shortly thereafter he went to work for
Holding as general manager of Snowbasin. His job was to develop
the resort that had been made possible by the land-exchange bill
he had helped draft. Upon hiring Reynolds, Holding made one of
his rare public comments, saying of his new general manager,
"He's a bright, intelligent, well-educated man. He'll really fit
our outfit extremely well."
The 1,378 acres Holding received--the area had grown
slightly--has glorious views of both mountains and valleys. It
is marked by great stands of fir, rugged outcroppings and myriad
trails that wind through trees, past ponds and onto bluffs
overlooking the bucolic farm valley below. Here will eventually
rise luxury homes, lodges, restaurants, riding trails, a golf
course and who knows what else. No doubt the world attention
that will be showered on Snowbasin during the Olympics will do
much to enhance its value.
The federal legislation required Holding to trade land "of
approximate equal value" for this choice piece of real estate.
On the surface it might appear that the U.S. government got the
better deal, because it acquired 11,757 acres from Holding.
Taxpayers got 8.5 acres for every one acre they gave up.
However, a close inspection of the land tells another story.
Let's start with Jebo Creek, one of the 21 properties in
northern Utah that Holding transferred to the Forest Service.
It's a 1,920-acre parcel in one of the state's remotest corners,
the high plains country some 100 miles northeast of Salt Lake
City, near the Idaho border. While the land around Snowbasin has
long been popular with outdoorsmen from nearby Ogden, Jebo Creek
draws a different crowd--cattle.
Stuart Wamsley, whose wife's family owned the land for decades
before selling to Holding, says the Forest Service now owns
prime grazing property. Wamsley describes it as a "right
beautiful piece of land." We'll have to take his word for it.
The place is so isolated, there's not a paved road into it.
Although ownership changed, nothing much else did. Cattle still
graze there, as they have for years, now as guests of federal
Many of the other parcels are similarly remote. A 2,800-acre
tract in Cache County is at elevations of about 9,000 feet and
can be reached only by what the federal appraiser who valued the
land called "unimproved trail roads." To visit another parcel in
the same county, Providence Canyon, you must take a dirt road.
When you get to the property--let the appraiser describe it:
"This parcel, a former stone quarry, takes up the canyon bottom
and both sides of the canyon.... There is not much vegetation on
the parcel because of its former quarry use."
As difficult to reach as those areas are, at least you can get
to them. Six parcels totaling 1,164 acres that Holding traded to
the government "have no physical access," according to the
federal appraisal. This is a far cry from the kind of land that
Senator Hatch described to his colleagues in 1995 when he urged
them to approve the exchange. "This land," said Hatch of the
parcels Holding intended to trade, "possesses outstanding
recreational, wildlife, mountain and access values for public
use and enjoyment."
So for the land at Snowbasin that was within an hour's drive of
half of Utah's population, Holding swapped land that most
Utahans will never see. "What they did was trade land that could
be used by people for land that can be used by animals," says
Wes Odell, a Utah resident who was active in an environmental
group that tried to block the land swap. One of the few
properties Holding gave up that is readily accessible to people
is an 847-acre tract in Ogden called Taylor Canyon, located on
the other side of the mountain from Snowbasin.
Not surprisingly, the land Holding traded was of much lower
value per acre than what he received. The 21 parcels he gave up
had an average value of $363 an acre. The real estate tax bills
on some are so low they read like a computer error: $5.25 on one
40-acre parcel last year, for example. By contrast, the Forest
Service land Holding obtained was valued at $3,000 per acre. In
one final touch the federal appraisal put the overall value of
the land Holding exchanged at slightly more than the land he
received. No problem: The Forest Service wired Holding $135,600
to cover the difference.
Holding wasn't through in Washington yet. Now that he had the
Forest Service land, he looked to taxpayers to build a $15
million road through it to his ski resort. Holding had promised
to pay for this road himself. In the 1980s, when Utah planned a
new highway into the Ogden Valley, Holding asked the state to
build it nearer Snowbasin. In return he promised to put in an
access road to the ski slopes to supplement the lone existing
road, a serpentine thriller completed in 1940.
The task of routing the Trappers Loop Highway (State Highway
167) closer to Snowbasin proved both challenging and costly.
It's one thing to build a highway in a valley (the original
plan); another to carve it out of the shifting sides of a
mountain (what Holding wanted). Once the land exchange cleared
Congress, a way opened for Holding to get out of his pledge to
build the access road: the Olympics.
In September 1997 Bennett stitched an amendment into a Senate
appropriations bill giving the Forest Service $800,000 to design
the access road. Bennett said it was crucial for Utah to meet
Olympic security criteria. "The safety of the athletes and the
spectators will be greatly enhanced with the relief provided by
this new access," said Bennett. Warning that time was running
out, he said, "It is important this work commence immediately."
Bennett failed to mention that the road would shave a half hour
or more off the driving time between the Salt Lake airport and
Holding's future resort.
By early 1998 it was dawning on folks in Utah, where newspapers
had written extensively about the Snowbasin controversy, that
federal taxpayers might have to foot the bill for the entire
road, not only its design. To make sure Utah taxpayers weren't
stuck with any part of the cost, a state legislative committee
adopted a resolution barring the use of state funds for that
purpose. By then Utah politicians and Olympic boosters were
mounting an all-out lobbying effort for a federal appropriation.
The Utah congressional delegation signed on. SLOC pushed for
federal help in the press and in the halls of Congress. When
Bennett visited the Winter Olympics in Nagano in February 1998,
he pointed to the traffic jams on the way to the downhill venue
to underscore the need for a new access road to Snowbasin. When
he returned to Washington, he asked Congress to appropriate $10
million to $15 million for the road. "If we don't get that this
year," he threatened, "we might as well hold the downhill in
Again Bennett and his band of Utah lawmakers delivered--at the
expense of taxpayers everywhere else. Legislation provided the
money for the Forest Service to pay for the road, not the U.S.
Transportation Department, which is responsible for highway
building and appropriations. What's the difference? A road built
with Transportation Department funds would have required the
expenditure of some Utah state money. No such matching was
necessary if the Forest Service built it.
Together, Bennett's bill and the land-exchange act exempted
Holding from having to come up with an environmental impact
statement on the initial phase of his Snowbasin development,
which included the building of the access road. Such a statement
could have delayed construction until after the Olympics. Utah
environmentalists were especially concerned about the waiver
because the road was laid out in an area susceptible to slides.
The $15 million road is something of an engineering marvel. It
runs a mere 3.5 miles, but it required all the skills of highway
builders to conquer the challenging terrain to reach Snowbasin.
To this scenic byway in February 2002 will come thousands from
all over the world to make their way to the mountain. And for
six days they will watch the world's best skiers vie for the
gold. Then they will go home.
As it has turned out, the road may cost taxpayers a lot more.
That's because in April the fears of environmentalists proved to
be well-founded. Shifting soil caused the pavement to break
apart, creating large gaps, and the Utah Department of
Transportation had to close the road for three weeks for repairs
and install a new drainage system. Whether the road will require
maintenance every spring, when it's most vulnerable to slides,
remains to be seen. As for Holding, he's free to do what he's
sought to do for 15 years--develop Snowbasin into a posh resort.
Holding, to be sure, offers a different version of these events.
Clint Ensign, Sinclair Oil's vice president for government
relations and a spokesman for Holding, concedes that the coming
of the Olympics expedited the land exchange his boss had sought.
Ensign says, however, that Games organizers and politicians were
the driving force behind the exchange. "Civic leaders and the
Olympic people came to Mr. Holding and said the only place we
can hold the Olympic [downhill] is at Snowbasin," he says,
pointing out that that group and Holding's oil company mounted
the lobbying campaign in Washington.
As for the access road, Ensign acknowledges that Holding had
agreed to pay for it in the 1980s, but by the time the land
exchange was approved, "circumstances [had] changed
significantly." In addition to letting SLOC use Snowbasin for
the Games, Holding was urged to make substantial improvements at
Snowbasin. "The city also encouraged him to build a hotel in
Salt Lake to accommodate the visitors who would come in," says
Ensign. "So he was being asked for a lot. And he talked about
that with the civic leaders, and he felt [the access road] was
no longer his responsibility."
Over the last few years Holding has transformed a 10-acre plot
into the hotel that civic leaders had asked him to build for the
Olympics. His 24-story Grand America Hotel, which opened last
spring, is the first Utah hotel to aspire to five-star status.
The white granite tower has 775 rooms, including 395 suites, and
a wealth of amenities. "Garden suites provide private balconies
overlooking lovely landscaped terraces and a sparkling swimming
pool," according to its website. "Opulent suites feature
welcoming foyers, graceful French doors leading to the bedroom
and imported marble bathrooms." Suites start at $365 and go up
to $3,500 a night for the penthouse.
Don't bother trying to book rooms at the Grand America for the
Olympics next February. The hotel is sold out--to corporate
sponsors, VIPs and the official broadcaster of the Games, NBC,
for whom it will serve as headquarters.
Holding has not revealed the cost of the Grand America, though
estimates range up to $200 million. Whatever the figure, the
quiet word around Salt Lake is that Robert Earl Holding paid for
it all--in cash.
COLOR PHOTO ILLUSTRATION: PHOTO ILLUSTRATIONS BY MIRKO ILIC
COLOR PHOTO: PETER READ MILLER Center stage Federal funds built two developer-friendly access roads to Utah Olympic Park, site of five of the Games' sports.
TWO COLOR PHOTOS: PHOTOGRAPHS BY TODD BIGELOW/AURORA Road to riches Uncle Sam paid not only for a winding, $15 million route to Holding's ski area but also for Olympic-related items like a light-rail system and sewers (far left).
COLOR PHOTO: LORI ADAMSKI-PEEK Bah relief The rebuilt Interstate 80 interchange serves resorts but not art connoisseurs.
COLOR PHOTO: KEVIN LAMARQUE/REUTERS
COLOR PHOTO: HOTOGRAPHS BY TODD BIGELOW/AURORA Safety first One of the federally funded temporary parking lots has also been used for security drills.
B/W PHOTO: NEW YORK TIMES CO./HULTON/ARCHIVE BY GETTY IMAGES '32 skidoo Hubert (front) and Curtis Stevens won bobsled gold at the first U.S.-hosted, but not U.S.-funded, Winter Olympics.
TWO COLOR MAPS: MIRKO ILIC Lay of the land Though the Games bear the name Salt Lake City, some venues are as far as 45 miles away.
COLOR PHOTO: HOTOGRAPHS BY TODD BIGELOW/AURORA How now? The Jebo Creek tract that Holding gave the government is good for grazing, and not much else.
Follow the Money
You would think that documenting the spending of federal tax
dollars in support of the Salt Lake Olympics would be as easy as
adding up your paycheck stubs to calculate your annual income.
But you would be wrong.
Governments at the federal, state and local levels have
different accounting systems. No federal agency or official is
responsible for monitoring the Olympic-related spending in
Washington, and few people in either the nation's capital or
Salt Lake City can even agree on how to define such spending. SI
arrived at its $1.5 billion estimate by analyzing figures from
Congress's General Accounting Office (GAO), the White House's
Office of Management and Budget, various federal and Utah state
agencies, the Utah Olympic Officer (the state's liaison with
Games organizers) and other sources. SI's total includes all the
federal dollars scored by Salt Lake Olympic boosters and Utah
politicians for projects that the boosters and politicians
themselves described as crucial to the Games.
SLOC president Mitt Romney (above) strongly disputes SI's
estimate. "That's way wrong," he says of the $1.5 billion
figure. "You're completely off.... Your article is striking me
as an entirely bogus piece. Why do you want to do that?"
Romney believes that only the federal dollars going directly to
support the Games, for things like security and temporary
parking lots, should be counted, and he puts that sum at $350
million. "If someone wants to count the completion of a highway
project in Utah as an Olympic project--which, by the way, was
not requested by the Olympics, isn't needed by the Olympics, has
nothing to do with the Olympics...if you call that an Olympic
project, well, yeah, you can get federal dollars to be huge,"
Romney says. "It's kind of hard to call [highway construction]
an Olympic project."
To the contrary--it's quite easy, as Utah's leaders have proved.
Every member of the state's congressional delegation, mayors and
public officials from across Utah, and Salt Lake Games boosters
(including SLOC trustees) wrapped themselves in the Olympic flag
when pleading for federal funds for highway, public transit and
other projects. They did so time after time. As Tom Dolan, mayor
of Sandy City, Utah, testified to a House subcommittee in March
1997, when asking for funds to help pay for highway work: "Every
person attending the 2002 Olympics in any capacity must travel
on either Interstate 15 or Interstate 80 at some point. The
primary importance of these two interstates to the smooth
operation and security of the Olympics has been emphasized
That Utah officials used the Games to extract transportation
dollars from Washington was widely reported in the state. As the
Deseret News noted on March 9, 1997, "Olympic organizers said
there's nothing wrong with telling Congress that every project
on Utah's $4.3 billion list [of requested funding for all kinds
of projects] is needed for the Winter Games, even though their
own must-do projects on that list only total $55 million."
To get an idea of how difficult it can be to determine the
amount of money being spent, consider the federal cost of
building temporary parking lots for the Olympics. The GAO
included the lots in a $77 million estimate for "spectator
transportation" for the Games without specifying how much was
allocated for the lots. Utah's Olympic Officer says the U.S.
government contributed $31 million for the lots. The Utah
Department of Transportation, which is building them, puts the
federal share at $23 million--for now. A spokesperson for the
department cautions, "Obviously, we won't have final costs until
all park-and-ride/walk lots are 100 percent completed and/or
Translation: Although the cost will be more, exactly how much
more remains unknown.
Utah senator Robert Bennett, apparently seeking to head off
criticism of his state's spending of federal dollars on the
Games, in August asked the GAO--which in September 2000
estimated Games-related federal spending at $1.3 billion--to
prepare a new audit of expenditures on Salt Lake and past
U.S.-hosted Olympics. The audit, which was released by Bennett's
office last week, put the amount of federal aid at $342 million,
but it included only direct outlays for the Games and thus
excluded much of the federal money secured in the name of the
Bennett's press secretary, Mary Jane Collipriest, in disputing
SI's numbers, said the first GAO report contained "errors" and
the new audit gives a more accurate picture. Bennett issued a
statement saying, "As I've continually said, the 2002 Games are
America's Games, not just Salt Lake City's, and the
participation of the U.S. government is not only an appropriate
responsibility, but a privilege."
Federal Spending for Olympics Held in the U.S.
Lake Placid Winter Games
Los Angeles Summer Games
Atlanta Summer Games
Salt Lake City Winter Games
*FIGURES ADJUSTED FOR INFLATION
U.S. spending at the 2002 Games will average $625,000 per
athlete, a 5,582% jump from '84.
Few will get to appreciate the murals; it's hard to study them
while whizzing by at 65 mph.
Surprisingly, all but $40 million of the $240 million in
security spending was approved before Sept. 11.
It's worth noting that for the '32 Lake Placid Games, local and
state folks footed the entire bill.
Utah's five-member Congressional delegation has been
well-positioned to funnel pork back home.
In his land swap, Holding gave the U.S. cheap acreage that is
largely remote, even inaccessible.
U.S. taxpayers don't pay to build parking lots for Super Bowl
cities or fund NBA drug testing.