Last February’s Winter Olympics will be forever remembered for red mittens and red ink because of the must-have souvenir and the Great Recession.

The Vancouver Olympic Organizing Committee is expected to announce Friday after a board meeting in BC Hydro headquarters that it broke-even on an operating budget forecast at $1.76 billion in January 2009. To avoid a deficit, it needed at least $80 million extra from federal and British Columbia taxpayers and $22 million from the International Olympic Committee.

“We made a promise to Canadians that our goal was to finish with no less than a balanced budget and, thanks to a pretty good effort by a lot of people, we’re headed in that direction,” chief executive John Furlong said after a Nov. 17 closed-doors board meeting.

VANOC was not ready for a downturn of any size. Its bullish May 2007 business plan assumed “the Canadian economy will remain relatively strong, with no recession, through Games time.”

Operating budgets for modern Olympics rely on advertising dollars, which are always among the first cuts of a recession. Several sponsors cut back or cancelled bulk ticket purchases, hotel rooms, parties or TV and billboard advertising. General Motors and Nortel went bankrupt. Governments came to the rescue.

In March 2009, less than a year before the Games, VANOC was in crisis. No top executive traveled to Denver for the IOC board’s only North American meeting of the year. Chief financial officer John McLaughlin asked for and received $19.2 million from the province for ceremonies and the torch relay. VANOC eventually admitted it couldn’t afford to finish hiring staff.

A QMI Agency source said VANOC bungled foreign cash accounts amid a yo-yo currency market and needed the Royal Bank’s help to cover two payroll periods.

VANOC promised quarterly disclosures but has not reported finances since Dec. 21, 2009. By comparison, Salt Lake 2002 organizers reported a $40 million profit exactly two months after their $1.39 billion Winter Olympics closed.

A July IOC report said VANOC sold 1.49 million tickets for $257 million; the forecast was 1.6 million for $260.4 million. Whistler Blackcomb reported it got $32.1 million for hosting skiing and sledding. In November, VANOC was still dickering with an insurer over $2 million lost when Latvian crooks used stolen credit card numbers to buy thousands of tickets online.

VANOC woes have not been ignored. Eight countries wanted the 2010 Games, but only three are bidding for 2018.

Bob Mackin reports for 24 Hours Vancouver, where this first appeared.