(This story was published in 2002).
At the annual meeting of the Federation of Gay Games in Johannesburg last October, Montreal won the right to host Gay Games VII in 2006. Since then, questions have been being raised as to the ethics of their winning bid, specifically the presentation of a $100,000 check to the Federation by Montreal representatives.
Outsports.com has viewed a videotape of the four presentations of the candidate cities--Montreal, Atlanta, Chicago and Los Angeles. At the end of Montreal’s presentation, its male representative--former Olympic swimmer Mark Tewksbury--tells the Federation it will be receiving letters of guarantee of monetary support from various Canadian entities. Tewksbury then holds a check, waves it in front of the delegation, and says, “you’ll be receiving those as soon as this presentation is over. With these guarantees, Montreal is ready to submit a payment of US $100,000 as a license fee advance deposit.”
“As a lawyer, I could not believe they were doing this,” says Bill Philbrick, an attorney for Atlanta 2006, who was at the presentation.
Philbrick and others contend that the waving of the check was used as an inducement to get Federation delegates to vote for Montreal. The license fee ultimately paid to the Federation by a host organization is upwards of $600,000. An initial payment, usually $10,000, is required at the signing of the contract. Montreal was offering to pay an additional $90,000 to the Federation up front.
What is not disputed is that the check was presented – there is videotape evidence of that, though questions remain as to what happened to the check after Montreal’s presentation. What also seems to be undisputed is that the check had an effect on the final outcome, even by those who say Montreal had the superior bid.
“I think it was a contributing factor to induce people to vote for them. And it worked,” says Al Petras, Co-Chair of Chicago 2006. “The money from Montreal helped.” Petras asserts that it was one of the many things that factored into Montreal’s victory.
When asked to clarify the Federation’s position on the effect of the check, Federation Female Co-President Kathleen Webster said, “We did not say that it didn’t have effect.”
Jean-Francois Perrier, the Secretary for Montreal 2006, in outlining the strategy of presenting the check said, “[the check] was just added at the very last minute, another reason, on top of all the other reasons. It was like the icing on the cake.”
What is in dispute is what happened to the check after Montreal’s presentation. Members of Atlanta 2006 said they heard that the check was given to the Federation and that the Federation held the check during the vote, which Montreal won on the first ballot. They also say that the check was discussed in pre-vote and post-vote meetings of the Federation.
Webster says that the Federation never received the check. Questions to the Federation regarding the post-vote meeting as to whether the check was discussed went unanswered. Perrier said that the check was destroyed immediately after Montreal’s presentation. He added that the check was unsigned and dated March 31, 2002. Perrier failed to respond to phone calls when Outsports requested to see Montreal 2006’s ledger, or view a carbon copy of the check.
The Federation and Montreal say that no money has changed hands and that, in fact, Montreal may not pay an initial $100,000 at the signing of the contract, but rather as low as $10,000 – which is what past winning bid cities have paid.
Whether the check was handed to the Federation or not, Philbrick asserts that damage was already done.
“There was definitely the appearance that Montreal was saying, if you give us the bid, we’ll give you this $100,000 check,” says Philbrick.
At the center of the controversy is the ethics behind Montreal’s actions. In the Code of Ethics for Directors, included with the Request for Proposal for Gay Games VII, Section 4, Paragraph 1 states: “Any actions on the part of a Bidding Organization that could be perceived as an attempt to influence a director’s vote should be immediately reported to the Site Selection Committee Co-Chairs.” Further in the Code of Ethics, Section 6, Paragraph 1 reads: “Directors are not to accept any gifts from Bidding Organizations unless they are given equally to all Board Directors at the time of the bid presentation. Such gifts shall not exceed US $25 in value each at the time of their presentation.” With 50 delegates voting, $100,000 split equally far exceeds $25.
“[The check] was unsavory. Los Angeles 2006 certainly wouldn’t have done it that way,” said Shamey Cramer, the head of the Los Angeles 2006 committee. “Of course they were trying to influence the vote.”
It is impossible to know how much of an impact the check had. Montreal seems to have had a strong bid on top of the sizable check: they said they had local community support and financial guarantees from local and federal governments and the local tourist board of $2.7 million.
“There were many factors involved in how we analyzed the bids,” said Webster. “Montreal has a strong history with the Federation. This was their second time bidding, so they have a history and experience in the bidding process. They also have involvement with the Federation, a strong support of the Gay Games, and local support [in Montreal].”
Specifically regarding the check, Webster felt that the check was simply a demonstration of Canadian government support: “As far as the FGG is concerned, the waving of the check – I think many people saw it as a theatrical device.”
“Montreal, based on everything, deserved to get that bid,” says Cramer. “They had the best marketing plan. In fact, their marketing plan surpassed what Sydney was planning [for this year’s Gay Games]. They proved they can market this event.”
Presently, none of the three bidding organizations that lost appear to be mounting a challenge with the Federation’s Site Selection Committee.
The Federation has a history of operating on a tight budget. As a non-profit organization run by volunteers, an advance payment of $100,000 is sizable.
“The Federation did not have enough money to do everything they wished to do,” says Perrier. He says Montreal’s hope was to share some of their good fortune with the Federation.
When Outsports.com requested to learn the balance of the Federation’s collective bank accounts at the time of the presentations, the Federation denied the request, saying the request would only be honored with by filing a request with the State of California, where the Federation is registered as a non-profit organization.
Beyond the bids for the 2006 Games, Philbrick is afraid that Montreal’s check-waving may have deeper repercussions. He said the Federation allowed a very dangerous precedent that could be followed by future bidding organizations. “Is there going to be an expectation the next time that they have to offer $150,000?” Philbrick asks.