“The USOC has terminated the Economic Development Agreement, the Design Build Agreement and Affiliation Agreement amongst the city, LandCo and the USOC,” USOC spokesman Darryl Seibel wrote in an e-mail. “That said, we are still in discussions with the city and LandCo to find a resolution to the open issues and, if possible, see these projects fully developed and delivered.”
The EDA, which spelled out in detail the responsibilities of all three parties, is the basis of an agreement in which the city and LandCo committed to finance, pay for and build various facilities for the USOC. LandCo and the city proposed to construct a downtown headquarters building, athlete housing at the Olympic Training Center and other improvements to the OTC campus, and to renovate a city-owned building adjacent to America the Beautiful Park for the use of National Governing Bodies.
City Council members were notified of the USOC’s withdrawal via telephone messages from the city attorney late Thursday afternoon.
“This is a public agreement,” said Vice Mayor Larry Small, “and if it’s no longer in force, then we need to have an open, public hearing to discuss the whole situation.”
City Councilwoman Jan Martin refused to comment.
While work proceeds on both the downtown headquarters building at 27 S. Tejon St. and on the NGB building, the athlete housing at the OTC remains in limbo.
The project, which began so hopefully, has devolved into a welter of lawsuits and mutual recriminations, with each party faulting the other participants for non-performance.
On March 27, LandCo filed a lawsuit in Federal District Court accusing the city and the USOC of multiple breaches of contract and of engaging in a deliberate scheme to cut LandCo out of the deal.
In its filing, LandCo stated that “… it is now clear that the USOC wants a totally different deal, and the city wants LandCo to pay for that deal.”
Under the original agreement, LandCo was obliged to provide $16 million for OTC improvements, and renovate the building at 27 S. Tejon for the USOC’s use. LandCo would retain two floors of the building for itself.
The city agreed to issue up to $32 million in certificates of participation to provide permanent financing for both the headquarters and the NGB building, and the USOC agreed to sign long-term leases to occupy both buildings for up to 25 years.
None of those contractual terms have been met. The city and the USOC have indicated that they can’t move forward unless LandCo first commits $16 million for the OTC improvements, and LandCo has so far failed to persuade its partners that the money is available.
The deal has been stalled for nearly six months.
Skip Gilbert, who heads USA Triathlon was present at a recent meeting of NGB executives with USOC CEO Stephanie Streeter. Gilbert said she characterized the EDA as “dead.”
He said she told the group that, “We’ve gotta come up with something different — we all want to get something done.”
Jim Johnson, CEO of G.E. Johnson & Co., the contractor for the headquarters building, said today that he had not been informed about the USOC’s withdrawal from the EDA.
But, he said, “That would be consistent with strategies that I have been told by the city. They’ve actually been sending their auditors to determine project costs. We were expecting to hear something yesterday (about a restructured deal), but so far nothing. There have been so many different deadlines out there I’ve lost track of them — but we’re going to get there, one way or the other.”
Johnson, whose company has shouldered much of the financial burden of renovating the headquarters building while the principals attempt to resolve their difference, remains optimistic.
“They’re this far away from making a deal,” he said, a fraction of an inch separating thumb and forefinger.
And, he was asked, does he feel confident that he’ll eventually get paid in full?
“Well,” he said, “we certainly hope so!”