Los Angeles Business Journal

Medal Event Shows Mettle

SPORTS: Special Olympics to be biggest event in 31 years. By David Nusbaum Monday, April 29, 2013
Patrick McClenahan of LA2015 at his downtown L.A. office.

Patrick McClenahan of LA2015 at his downtown L.A. office. Photo by Ringo Chiu.

Winning bid

The bid for the upcoming summer games was awarded to Los Angeles that year. A study commissioned by the bid committee forecast an economic benefit for Los Angeles County of $415 million. That includes direct spending of $128 million from attendees, $23 million for accommodations and $28 million for production of the games. The event is expected to generate tax revenue of $27.5 million.

For comparison, a Super Bowl can have an economic benefit for its host city of $150 million to $300 million, with a high of about $500 million.

In other countries, the government is heavily involved in bidding for these types of world-class events. For example, the 2007 Special Olympics in Shanghai received 85 percent of its budget from the Chinese government.

“Our basic premise and model is privately funding this event through philanthropic dollars,” said McClenahan.

In order to raise the $90 million needed to meet the organization’s budget, he and his team have reached out to corporate sponsors and wealthy individuals for donations. In total, the organization expects to raise 75 percent of its budget from cash donations and the balance from in-kind gifts.

So far, they have received five contributions of $1 million in cash from Mattel Inc.; AEG; Kaiser Permanente; Steven Spielberg and his wife, Kate Capshaw; and David Geffen.

The companies and people who commit to a $1 million gift are recognized as founding champions. McClenahan expects 12 to 15 companies to sign up at that level. For that level of contribution, companies will receive 25 seats at the opening and closing ceremonies at Coliseum, access to VIP lounges and other perks. Lower-level sponsorships are available starting at $25,000. The organization also expects to receive small donations from individuals who support its mission.

In addition to corporations and individuals, several local foundations have made contributions, including California Community Foundation, $200,000; California Endowment, $200,000; Weingart Foundation, $100,000; and Rose Hills Foundation, $100,000.

Some companies are contributing in-kind donations as well. Kaiser Permanente pledged $1.5 million in-kind by lending its medical expertise. Local agency Davis Elen Advertising Inc. has taken on the organization as a pro bono account. It has provided $2.5 million in services that includes logo development, video production, branding strategy and other advertising work.

The local office of Deloitte has provided $3 million in-kind that includes office space for LA2015, business plan development and a financial officer who serves as controller for the organization.

“We have a cash budget that we provide for charities, but the talent of our people is a valuable resource,” said Michelle Kerrick, managing partner of Deloitte’s L.A. office. “As a firm, we have a commitment to provide $60 million in pro bono work and we’ve set aside $3 million for the Special Olympics.”

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