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SLOC Shakeup
Salt Lake's scandal-scarred Olympic committee launched an internal shakeup today that included hiring a new chief _ Massachusetts venture capitalist Mitt Romney.
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(Feb. 11, 1999)------"My goal is to make Utah proud, to make America proud,"
Romney said in taking over as president and chief
executive officer.
As the Salt Lake Organizing Committee undertook
sweeping reforms, including new conflict of interest rules,
three of its leading members resigned.
SLOC gave Romney its unanimous endorsement to take
over the committee running the 2002 Winter Games,
which has been rocked by the biggest corruption scandal
in the history of the Olympics.
"These games and the preparations leading up to the
games will comply with the highest level of ethical
conduct," Romney vowed.
Acting on proposals by Gov. Mike Leavitt, SLOC approved
expanding its board of trustees from 33 to 50 and stripping
it of its decision-making authority, making it an advisory
board to a new management committee of 20.
Leavitt also gave any SLOC member with a perceived
conflict of interest 60 days to resign. Two SLOC trustees
directly affected _ Earl Holding and Alan Layton _
immediately resigned.
Layton's construction company won a $29 million contract
to enclose the speedskating oval. Holding is the owner of
Snowbasin Ski Area, which will get $13.8 million from
SLOC as the downhill and super-G venue, and Little
America Grand, a hotel being built downtown that is
expected to be the IOC's home during the games.
Also resigning was Verl Topham, president of Utah Power
who had served on the original bid committee, saying he
was doing so for the good of the games.
SLOC also adopted an open meetings and records policy
and that SLOC members be required to attend 75 percent
of meetings.
Romney said he doesn't believe the Olympic movement
would be permanently stained by the scandal, in which
the bid committee executives were found to have engaged
in unethical conduct in spending more than $1 million to
curry favor with 24 International Olympic Committee
members to win the games.
"The managers have messed up big time," he said. "The
athletes haven't. Our job is to go to work for the athletes."
Romney pledged to spend no more money than the
Olympics take in, to spare taxpayers from funding and to
protect the state's environment.
"Utahns will share in the thrill of the Olympic Games," he
said.
Romney, the choice of Leavitt and SLOC chairman Robert
Garff, met with members of a hastily organized selection
committee Tuesday night.
That came just hours after the SLOC ethics committee
released its report saying bid committee executives
engaged in unethical conduct in spending more than $1
million to curry favor with 24 International Olympic
Committee members and win the right to hold the games.
Romney, 51, a Republican who unsuccessfully challenged
Sen. Ted Kennedy in 1994, is the son of the late George
Romney, governor of Michigan.
He lives in Belmont, Mass., and also has a home in Park
City, Utah. He graduated from Mormon church-owned
Brigham Young University in Provo, Utah, and has been a
Mormon bishop (lay leader of a congregation) and stake
president (leader of a group of congregations) in
Massachusetts.
Romney's Boston company, Bain Capital Inc., specializes
in buying companies and turning them around. Domino's
was a recent acquisition.
"He has the perfect business background. He knows how
to take major businesses in trouble and turn them
around," said Henry Marsh, one of a handful of board
trustees asked by Garff on Tuesday to peruse applications
for the top SLOC job.
The SLOC ethics report linked another 10 IOC members
to the scandal, bringing to 24 _ a fifth of its membership _
the number of delegates accused of accepting excessive
benefits.
Senior Olympic officials said today that the IOC would
investigate the 10 even though not all of the new cases
appear to warrant expulsion.
IOC director general Francois Carrard said the 10 new
names cited in the Salt Lake City ethics report were not
necessarily guilty of major offenses.
"We will look into all these matters, but prima facie, some
of the cases do not necessarily appear to be serious,"
Carrard said in a telephone interview from Lausanne,
Switzerland. "This doesn't mean we will not go to the
bottom of the matter. If, after careful study, we find we
have to make further recommendations (for expulsion), we
will make them."
Nine members have either resigned or been expelled by
the IOC executive board. Three others remain under
investigation, one received a warning and one has died.
IOC marketing director Michael Payne, in New York today
to meet with Olympic sponsors, said the IOC is doing
everything in its power to stamp out corruption and
institute reform.
On Tuesday, the head of Olympics sponsor John Hancock
insurance criticized the IOC's handling of the crisis and
suggested that IOC president Juan Antonio Samaranch's
tenure may be running out.
But Payne rejected the continuing calls from outside the
IOC for Samaranch to resign, saying the 78-year-old
president is needed to lead the house-cleaning efforts.
"If the president stepped down, you would have a
presidential election with all the instability that would
bring," Payne said. "That's the last thing you want at this
stage. You need a firm hand at the top to drive through the
changes."
Payne said there was no crack in support from the
Olympic sponsors who pay tens of millions of dollars to
help finance the games.
"The sponsors are standing, first of all, behind the games,
and, second, behind the steps and action the IOC,
Samaranch and the executive board are taking," Payne
said.
In other developments:
_Leavitt and US West denied there was a connection
between a $5 million Olympic contribution by the phone
company and Leavitt pushing telecommunications
deregulation. However, Leavitt said he was dropping
deregulation from proposed legislation to wire Utah
government and schools for fast Internet service.
_The Salt Lake bid committee's outside auditors, the
accounting firm Ernst & Young, denied the ethics report's
allegations that it had failed to call attention to
undocumented expenditures by Olympic bid executives.
It said it identified and discussed undocumented
expenditures with senior management and the chairman of
SLOC's audit committee. However, James Beardall,
chairman of the audit committee, told The Salt Lake
Tribune that "I was not made aware of undocumented
financial expenses.... On the contrary, I was assured by
the bid committee's auditors that there were no items of
special significance not previously reported which should
be brought to the attention of the audit committee or the
board of trustees."
_Barbados IOC member Austin Sealy, implicated in the
Salt Lake report, denied any wrongdoing. Bid records
showed $3,000 a month passed through a company
affiliated with a consultant to Sealy.
