Santa Monica officials say they are “very close” to reaching an agreement to host beach volleyball during the 2028 Summer Olympics, even though it might end up costing the city millions of dollars.
A 36-page study released on Tuesday night outlined the risk of incurring a $12.1-million net loss, but officials noted a chance to recoup expenses if the Games are financially successful.
The matter now proceeds to a City Council meeting on Oct. 8 for discussion and public comment.
“We think we are very close to addressing all the outstanding issues,” city manager David White said. “That’s why we are very confident and feel that this is a good time to be in front of our council.”
Beach volleyball originated in Santa Monica and Hawaii during the early 1900s, so it makes sense that LA28, the private committee charged with staging the Games, wants to build a temporary 12,000-seat stadium and practice courts on the sand north of Santa Monica Pier.
Among other cities that have joined Los Angeles in hosting events, Long Beach and Carson were quick to sign an initial — and binding — Games Agreement with organizers. Santa Monica has proceeded more cautiously through a year of negotiations.
White said his staff wanted to “make sure our council and our community are just really, fully apprised of what it means to be a venue city.”
The process involved commissioning a study by HR&A Advisors, a private consultant, to estimate the financial impact and identify the unknowns that come with hosting a major event still four years away.
The report predicts that providing extra city services such as policing, traffic control and garbage collection during the Games could cost as much as $15.54 million. Some of that amount could be offset through $14.09 million in tax revenues and rental payments from LA28.
Still, the city would be left with an estimated net loss of $1.45 million.
If Santa Monica chooses not to serve as host, consultants said, it might still receive $11.3 million in increased revenues from tourists attending the Games in neighboring communities. The costs in this scenario would be only $650,000.
“Taken together, these findings suggest that choosing to host Olympic beach volleyball translates to a net loss of roughly $12.1 million to the [c]ity,” the report states.
Officials must now weigh this risk against what they describe as “a truly distinct honor” of being part of the Games. They see intangible benefits in generating civic pride and enhancing their city’s brand, even if the prospect of attracting an estimated 450,000 fans doesn’t mean much to an established summer destination.
“We’re already there,” assistant city manager Susan Cline said. “We’re typically around 90% [hotel] occupancy anyway.”
After next week’s public meeting — dubbed a “study session” — council members could hold a vote later in the month. If approved, the initial contract would serve as an entry point to further negotiations.
The two sides would haggle over how much LA28 reimburses the city for its additional services. Any such payments would depend on organizers, who have vowed to pay for the Games through a variety of revenue sources, finishing with a surplus.
There is the question of whether Santa Monica Pier could remain open during the Games. Santa Monica also wants to be sure the beach is restored to its original condition afterward.
Officials expressed optimism that an agreement can be reached.
“Without a doubt, we believe we are the right venue for beach volleyball,” White said. “And that’s why we’ve been working at this so hard.”