Organizers of the Vancouver Winter Olympics will receive an additional $110 million from the Canadian and B.C. governments to cover escalating costs of building venues for the 2010 Games.

Prime Minister Stephen Harper and B.C. Premier Gordon Campbell announced the long-awaited cash infusion during a news conference in Vancouver on Wednesday.

The federal government will contribute $55 million to help pay for the increase in the cost of building Olympic venues in Vancouver and Whistler, Prime Minister Stephen Harper announced on Wednesday.
(CBC)

Each level of government will contribute $55 million, bringing taxpayers' expenditure on venue construction to $580 million.

Vancouver Olympic organizers originally pegged the cost of building venues at $470 million.

John Furlong, the chief executive officer of the Vancouver Organizing Committee (VANOC), blamed the rising price of materials and a shortage of skilled labour for the skyrocketing costs.

Furlong also said the initial estimate was prepared, according to International Olympic Committee requirements, in 2002 dollars and didn't factor inflation.

To deal with the soaring costs, Olympic organizers offloaded some projects onto municipalities and scrapped other venues altogether. 

Earlier this month, Whistler city council voted to kill plans for a Paralympic sledge hockey arena because the building costs jumped to $60 million from $20 million.

The B.C. government had pledged to pony up more cash to VANOC nearly a year ago, but that money was contingent on the federal government matching the offer.

VANOC took its request to a then-Liberal minority government in October 2005, but it was delayed when the Conservatives took power.

Meantime, Olympic organizers were forced to borrow money to fund their summer construction program.