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Citizens to audit nebulous Pan American Games finances

January 25, 2013

Having borrowed 2.4 billion pesos to pay off outstanding debt from the Guadalajara 2011 Pan American Games, the Jalisco Congress has proposed that a citizens’ committee investigate the finances behind the games.

State legislators from the National Action Party (PAN), the Institutional Revolutionary Party (PRI) and the Party of the Democratic Revolution (PRD) are working to combine three proposals for citizen participation in the auditing process. The PAN and PRI deputies agreed that the committee should be composed entirely of citizens because they consider state auditor Alonso Godoy Pelayo to be untrustworthy.

“If there is an audit and it is properly supported, it should have credibility. Today, there is no credibility because the citizens do not trust the auditor who has shown for years that he is neither trustworthy nor responsible,” PAN deputy Guillermo Martinez Mora said.

Godoy stands accused of illegally pocketing more than nine million pesos during his term in office, but remains state auditor as a judge ruled last year that he could not legally be removed from office.

Although politicians often extol the economic benefits of staging major sporting events, it is not uncommon for governments to struggle for years to pay off the debts incurred.

The state government owes 3.4 billion pesos, with the Pan American Games having cost 619 million dollars, over three times the projected cost of 180 million dollars. The government had predicted the games would bring a windfall of 2.7 billion pesos, but a planned investigation into how much money the event brought in was never realized.

More than a year since the games ended, many of the sporting venues remain unused, including the athletics and baseball stadiums and the San Rafael gym, while the future of the vacant Athletes Village is the subject of an ongoing legal battle.

Having spent 1.4 billion pesos on building the Athletes Village beside the Omnilife Stadium on the city’s western outskirt, the state government intended to sell the property as luxury apartments. However, the future of the Village remains undecided, with Zapopan authorities having refused to approve any sale due to the site’s proximity to the protected Bosque Primavera.

Jalisco credit rating recovers

Fitch Ratings has restored Jalisco’s credit rating to BB+, having reduced it from A+ to D- late last month.

The government’s rating was downgraded after the State Congress voted to default on a 1.4-billion-peso loan contracted to help pay for the Guadalajara 2011 Pan American Games. But, as reported last week, Congress has since approved another loan of 2.4 billion pesos in order to pay off the outstanding debt instead of defaulting.

Fitch reported that state officials had provided official documentation guaranteeing full repayment of the initial loan on January 17.

“Jalisco has a relatively high level of long-term debt,” Fitch noted, “but the debt is now manageable given the size of the state budget.”

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