Mayor Olivia Chow says she's 'saddled' with rising costs of hosting World Cup

Toronto Mayor Olivia Chow says she wouldn't have agreed to bid for the FIFA World Cup if she had known how much it would cost, but the city has to follow through despite the estimated cost increasing.

Chow made the remarks at a news conference Thursday as her executive committee met for an update on the plan for hosting one of the biggest sports events in the world.

"I'm glad that we have this opportunity to host the FIFA World Cup. Would I want to see $380 million being spent on it? No," she told reporters. "I didn't sign this deal ... I'm saddled with it."

Toronto and Vancouver were chosen as the Canadian cities to host matches during the 2026 men's World Cup, which will also be played across the United States and Mexico. Former mayor John Tory led the push to bid for the soccer tournament, calling it a "once-in-a-generation opportunity."

But a city report released this week estimated the cost of hosting the tournament had increased to $380 million from $300 million estimated last year.

The report linked the cost increase to Toronto being awarded a sixth match, one more than initially predicted, as well as an evaluation of vendor quotes, safety and security requirements and inflation.

'Let's try to control the costs'

Earlier this month, the provincial government said it would give Toronto up to $97 million to help cover the cost of the tournament, as long as the federal government matches its contribution.

The federal government hasn't specified how much it will contribute. City manager Paul Johnson told the committee Thursday that it normally contributes up to 35 per cent of the total cost of major sporting events, but no more than 50 percent of the public contribution.

Chow said she wouldn't have signed a deal to host the tournament without first locking in firm funding commitments from both levels of governments. But now that the bid's been successful, she says the focus should turn to planning, including getting the stadium prepared and signing vendor contracts, while keeping costs down.

"Hosting the games means embracing the games," she said. "Let's get people participating, let's try to control the costs as much as we can and make the whole FIFA World Cup process transparent and [ensure][ that everything is done responsibly."

The committee voted at Thursday's meeting to increase council oversight of spending decisions and procurement related to the World Cup. City staff had asked for delegated authority to sign contracts with a value exceeding $500,000, which would normally require council approval, but councillors passed a Chow-amended motion that removed this authority.

Majority of tax revenue will go to province, feds

Other recommendations passed by the committee include having city staff identify all the tournament costs ahead of next year's budget process.

"We will go through the regular process, and we will do the line-by-line analysis to make sure funds can be trimmed if possible," Chow told the committee.

"We will not delegate and do as much as we can collectively. However, there are things that need to be delegated that we will do so, so we don't micromanage."

The city expects to see an economic boost of roughly $392 million in GDP for Toronto — about $1 million less than previous projections — and an additional $456 million for Ontario's GDP, according to the staff report.

That will amount to tax revenues totalling nearly $119 million in the Toronto region and roughly $139 million within the province. The economic activity figures are based off of hosting five games, the report notes, and could continue to change.

However, the vast majority of the tax revenue will go to the federal and provincial governments. While the staff report didn't break down how much each government would receive, a business plan presented to council in March 2023 estimated the city would only receive $3 million through its accommodation tax on hotels and short-term rentals, while the federal and provincial governments would take in an estimated $70 million and $50 million total.

Cost hard to justify, councillor says

Coun. Josh Matlow (Toronto-St. Paul's) said it's hard to justify spending on the event when the city faces annual deficits. 

"This is turning into a fiasco. The contract should have never been executed without a clear commitment from other levels of government that would have mitigated the risk to Toronto taxpayers," Matlow said.

Coun. Mike Colle (Eglinton-Lawrence) said while the costs are concerning, the tournament will bring a big boost to the local hospitality industry, including hotels, restaurants and bars that suffered during the COVID-19 pandemic.

Colle said he's looking to attract more business sponsorships in order to offset the costs of hosting the tournament.

"Corporate Toronto's got to step up to now because they're the big beneficiaries of all this activity," he said.