Title
Adoption of Resolution Authorizing the City Manager to Negotiate and Execute a Transient Occupancy Tax Sharing Agreement with the Oakland Roots & Soul in an Amount Not-To-Exceed $150,000 in Support of a World Cup Team in their Alameda Facility during the World Cup Tournament in Summer, 2026. (Base Reuse and Economic Development 10061810)
Body
To: Honorable Mayor and Members of the City Council
From: Jennifer Ott, City Manager
EXECUTIVE SUMMARY
In the summer of 2026, the FIFA Men’s World Cup tournament will be held in North America. The Oakland Roots & Soul (Roots) has been approached by the International Federation of Association Football (FIFA) to have its training facility, located in Alameda, be designated as a Team Base Camp Training Site. The main benefit to the host community and surrounding area of being a Team Base Camp is the thousands of fans interested in following a team, especially one that is highly ranked. However, the Roots training facility would require upgrades, and the host is expected to carry other costs estimated at $700,000. This item would enable the Roots to share up to a maximum of $150,000 from the City of Alameda Transient Occupancy Tax (TOT) tax increment above a baseline amount, in support of the proposal to FIFA to sponsor a World Cup team at the Alameda-based training facility during the 2026 World Cup.
BACKGROUND
In the summer of 2026, the FIFA Men’s World Cup tournament will be held throughout North America. The Roots has been approached by FIFA to have its training facility, located in Alameda, to be designated as a Team Base Camp Training Site. While the closest games will be played at Levi’s Stadium in Santa Clara, each World Cup team needs a Base Camp as a location to stay and train throughout the tournament. Given that the high-quality facility for the Roots is located less than one mile from the Oakland Airport, the Bay Area’s temperate climate, and world class tourism opportunities, FIFA representatives have indicated that the Roots facility in Alameda will likely attract a highly seeded team that will be at the Base Camp for much of the tournament.
The main benefit to the host community and surrounding area is the thousands of fans interested in following a team, especially one that is highly ranked. Based on past World Cup events, FIFA projects an average of 30,000 hotel nights in the immediate vicinity of the training facility. This number is based on FIFA's experience for training facilities that are not near a game day venue, comparable to the Roots facility and Levi’s.
Fans will also be drawn to at least one community-based event with the visiting team at the training facility, and depending on the selected team, likely other events that will be curated in partnership with the team. This is in addition to activities such as World Cup watch parties and Roots sponsored events.
While the presence of a Team Base Camp will provide economic opportunity to the community, hosting a team results in a significant financial cost to the Roots club, as the organization would be responsible for providing a level of services (24-7 security, elevated field maintenance, significant physical space and associated support, on call technology support, maintenance and other services, etc) that exceeds the compensation offered by FIFA.
The Roots anticipate an uncovered operating cost of at least $700,000 and the need to invest approximately $5 million in field upgrades. They are therefore seeking partnership with Alameda and the neighboring cities to support and close the financial gap and for the community to benefit overall.
DISCUSSION
Given the potential economic development benefit to the City from a Team Base Camp at the Roots facility in Alameda, staff recommend pledging the incremental increase of TOT hotel tax beyond a baseline amount and up to a maximum total of $150,000 to help cover the Roots’ costs. By ensuring a baseline amount of TOT revenue to the City’s General Fund, this proposal does not adversely impact the City’s financial situation. Staff commissioned Keyser Marston Associates (KMA) to analyze baseline and incremental possible increases in TOT tax, and believe a reasonable maximum amount to allocate is $150,000.
TOT Increment
The attached Exhibit 1 consists of the fiscal analysis and assumptions to support staff’s recommendation including the projected total TOT tax generated from the three Harbor Bay hotels, the remaining hotels throughout Alameda, as well as short-term home rentals, based on approximately 12,000 total room nights over a 30-day period. A baseline occupancy rate during the month of June for previous years shows Alameda hotels at 77% and short-term rentals at 58%.
KMA modeled the incremental increase in occupancy rate for the three Harbor Bay hotels from a baseline of 77% to 100% based on their proximity to the Oakland Roots training facility in Harbor Bay. Remaining hotels in Alameda were assumed to have an occupancy rate increase from 77% to 94%. Short-term rentals were estimated to have an occupancy rate increase from 58% to 74%. With a nightly rental rate assumption of $180 for Harbor Bay hotels, $140 for the remaining Alameda hotels and $300 for short-term rentals and a 14% TOT tax-rate for Alameda, the estimated TOT tax increase for the time of the tournament is $132,000.
In support of the TOT revenue projection calculations, Exhibit 1 breaks down the overall estimated room nights spent between the team delegation that is estimated to stay for 28 nights, family, friends and media that are estimated to stay for 14 days, and non-local fans that are estimated to stay for four (4) nights.
Additionally, Exhibit 1 shows the difference between a 100% occupancy across all room types for a total TOT increase of $225,000 versus the more conservative TOT estimated increase of $132,000; historical averages of TOT revenue, hotel occupancy, average room rates and revenue per room for the periods of June-July for the years 2022, 2023 and 2024; and the number of rooms available for each Alameda hotel. It should be noted that an additional Hilton Garden Inn that is currently under construction in Harbor Bay was not included in the current KMA analysis, but would be included in the TOT sharing agreement if it is open at that time.
Based on these assumptions provided in Exhibit 1, staff recommend an allocation of TOT to the Roots for amounts exceeding 77% occupancy for hotels and 58% for short term rentals for the period in which the Roots would function as a Team Base Camp training site for the 2026 World Cup, in an amount not-to-exceed $150,000. Staff believe there is the possibility of an additional economic benefit to the City in the form of increased spending at restaurants and shops, as well as increased visibility of the amenities offered in Alameda.
ALTERNATIVES
• Adopt a resolution authorizing the City Manager to execute a Transient Occupancy Tax Sharing agreement with the Oakland Roots & Soul.
• Do not adopt a resolution authorizing the City Manager to execute a Transient Occupancy Tax Sharing agreement with the Oakland Roots & Soul
.
FINANCIAL IMPACT
The $150,000 pledged through the TOT sharing agreement will be derived from the incremental increase in TOT tax generated from the event, as supported by the fiscal analysis in Exhibit 1. This assumes that occupancies would not exceed average occupancy rates but for the presence of this event. This event could generate roughly $22,000 in additional sales tax revenue to the City, as estimated in Exhibit 1.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
The City’s economic development activities are based on the Economic Development Strategic Plan and continue to support and move forward the strategies.
This action is subject to the Levine Act.
ENVIRONMENTAL REVIEW
This action does not constitute a “project” as defined in California Environmental Quality Act (CEQA) Guidelines Section 15378, and therefore, no further CEQA analysis is required.
CLIMATE IMPACT
There are no identifiable climate impacts or climate action opportunities associated with the subject of this report.
RECOMMENDATION
Adopt a resolution authorizing the City Manager to negotiate and execute a TOT sharing agreement with the Oakland Roots & Soul in an amount not-to-exceed $150,000 in support of a sponsorship of a World Cup team at their Alameda Training facility during the World Cup Tournament in Summer, 2026.
Respectfully submitted,
Abigail Thorne-Lyman, Base Reuse and Economic Development Director
By,
Dwayne Dalman
Economic Development Division Manager
Financial Impact section reviewed,
Ross McCarthy, Finance Director
Exhibit:
1. Fiscal Analysis and Assumptions