As Los Angeles prepares to host its third Olympic and Paralympic Games, the city finds itself balancing an expanding budget against a complex web of overlapping fiscal and regulatory jurisdictions, The Pew Charitable Trusts reported.
When the International Olympic Committee awarded the 2028 Summer Games to Los Angeles in 2017, California was sitting on a $9 billion fiscal surplus. That cushion was nearly double the estimated budget for the event at the time, offering a sense of financial security that mirrors the bullish tax revenue projections preceding the 1984 Los Angeles Olympics.
Yet subsequent disruptions have altered that outlook. A global pandemic, stubbornly high inflation, and catastrophic wildfires in January 2025 have complicated local financial planning, according to Pew Charitable Trusts. The organizing committee, known as LA28, has since updated its budget from an initial $5.3 billion to $7.3 billion. That upward revision accounts for inflation, newly added sports, refined venue plans, and contract modifications.
Hosting duties require a division of labor between the private organizing committee and public entities. LA28 finances its operations primarily through corporate sponsorships and ticket sales, while host governments cover major components such as public safety and transportation. However, a study from the University of Oxford found that every Olympics with available data has run significantly over budget—by more than 100% on average—since 1960.
Alexander Budzier, an author of the Oxford study and management practice fellow at Saïd Business School, noted the difficulty of relying on optimistic economic forecasts. “Some miracles occur, but basing fiscal policy on miracles is probably not the most prudent choice,” Budzier told The Pew Charitable Trusts.
Managing the financial risks involves careful revenue mechanisms, though options remain constrained in California. Most local tax increases require voter approval under state law.
In June 2026, Los Angeles voters rejected a proposed hotel tax increase that would have raised more than $40 million for the city’s general fund ahead of 2028. Without new local tax mechanisms, the state of California is positioned to collect about 60% more Games-related tax revenue than local municipalities.
Jason Sisney, a budget adviser to California State Assembly Speaker Robert Rivas and an Olympic historian, addressed the scale of the state windfall. “It’s hundreds of millions of dollars, which in the scheme of the California budget is helpful, but it’s not a panacea,” Sisney told Pew.
Even with state revenue inflows, structural pressures like high baseline expenses, reduced reserves, and elevated debt will persist in California after the closing ceremonies.
To mitigate construction risk, LA28 adopted a no-build philosophy, planning to rely entirely on existing venues. Rick Cole, a Pasadena council member and former Los Angeles deputy mayor, pointed out the logistical reality of the sprawling footprint. “This is the unique part about having an Olympics in Los Angeles,” Cole told Pew.
“The venues are already built, but they’re built in a bunch of different places.” While LA28 expects to spend $1.4 billion on venue improvements and temporary infrastructure, local, state, and federal governments are expected to contribute at least $2.7 billion to renovate existing facilities.
Transportation and security funding remain pressing concerns as deadlines approach. The Los Angeles County Metropolitan Transportation Authority requested $379 million from the state, while $875 million in federal appropriations stalled in Congress.
Metro leadership warned that without federal funding by the end of 2026, the agency would struggle to manage the immense transportation demand during the Games. Meanwhile, the U.S. Secret Service will oversee security under the National Special Security Event designation, backed by $1 billion appropriated in federal legislation.
LA28’s budget maintains $600 million in expected contingency funds, including a required $270 million allocated reserve. Whether that cushion will absorb rising costs as the 2028 Games draw closer remains a central fiscal question for city and state leaders.
