Item - 2022.EX34.8

The Executive Committee recommends that:

1. City Council authorize the City Manager to execute a Multi-Party Agreement with the Governments of Ontario and Canada and with Canada Soccer, including any amendments and extensions as required, reflecting the key elements outlined in this staff report and Item EX31.3, on terms and conditions satisfactory to the Chief Financial Officer and Treasurer, and in a form acceptable to the City Solicitor.

2. City Council direct the City Manager to create the FIFA World Cup Toronto 2026 Staff Secretariat, to be fully established by the first quarter 2023, within the Office of the Deputy of City Manager, Community and Social Services, and approve an increase of the 2022 staff complement for the Social Development, Finance and Administration Division by nine (9) temporary positions beginning in 2022 in order to support project planning and preparation. 

3. City Council approve an increase of $1.225 million gross and $0 net to the 2022 Council Approved Operating Budget for Social Development, Finance and Administration, fully funded by the Major Special Event Reserve Fund, for use by the FIFA World Cup Toronto 2026 Staff Secretariat in support of World Cup planning and development requirements.

4. Council approve an increase of $0.048 million gross and $0 net and associated staff complement of one (1) dedicated temporary position to the 2022 Council Approved Operating Budget for Parks, Forestry and Recreation, fully funded by the Major Special Event Reserve Fund, for managing the Division's capital program initiatives related to World Cup hosting, starting in 2022.

5. City Council authorize the Deputy City Manager, Community and Social Services, to negotiate and enter into an agreement with Maple Leaf Sports and Entertainment for activities in support of Toronto's hosting of World Cup 2026, and any amendments and extensions as required, including but not limited to management of temporary and permanent upgrades at the BMO Field and maximization of the value of delegated commercial rights to help offset the City's costs of organizing the World Cup in Toronto, on terms and conditions satisfactory to the City Manager, Deputy City Manager, Community and Social Services, and Chief Financial Officer and Treasurer, and in a form acceptable to the City Solicitor.

6. City Council direct the Deputy City Manager, Community and Social Services, to report to City Council in the first quarter of 2023 to provide an update on overall project management, to include the status regarding funding, intergovernmental negotiations, financial strategy, community engagement and activation of the Staff Secretariat and working groups.

7. City Council direct relevant City Divisions and Agencies to include, in 2023 and future year budget submissions, a multi-year capital and operational budget and plan requirements, including level of staff and investment, timing and funding sources, in planning and hosting the 2026 World Cup.

The FIFA Men's World Cup (World Cup) is the world's most watched sporting event, with a global viewership of four billion people for the entire competition and upwards of 200 million for each match. Overseen by the International Federation of Football Association (FIFA), the World Cup is held every four years and generates significant economic and cultural benefits for host cities. In 2018, the 2026 World Cup was awarded to a joint bid by Canada, Mexico and the United States, with 80 matches to be staged across 16 cities in North America, of which 10 matches are expected to be in Canada.

On June 16, 2022, the City of Toronto was announced as an official Host City for the World Cup 2026. As directed by City Council in April 2022, this report provides a status update including status of negotiations with the Governments of Ontario and Canada, updates on cost estimates, and an implementation plan for the event secretariat required for the successful planning and execution of the 2026 World Cup in Toronto.

Toronto hosting part of the 2026 World Cup will bring global media attention and positive economic and cultural benefits for the city that will sustain COVID–19 recovery in hard hit sectors, such as tourism, hospitality and entertainment. Projected benefits of hosting five matches in Toronto include:

· Estimated $307.0 million dollars of GDP impact;

· 3,300 jobs;

· 174,000 overnight visitors; and,

· 292,000 room nights generating projected Municipal Accommodation Tax (MAT) revenues of $3.5 million.

Overall, the operations and capital costs to be incurred locally in Toronto have been projected to be approximately $300.0 million by 2026, including a 10 percent contingency.  This reflects a 3.4 percent increase in the projected cost as presented to City Council in April 2022, due the recent escalation in inflation rates. In keeping with the Federal Policy for Hosting International Sport Events in Canada, the Governments of Canada and Ontario are expected to cover up to two-thirds of this amount - an approximate total of $184.0 million. In addition, the cost of hosting the World Cup will be also partially offset through access to commercial rights and related revenue opportunities delegated by FIFA to event organizers, such as the City of Toronto. The cost for the City of Toronto, prior to any further offsets including earned revenue sources from fees, commercial sponsorship and local partnerships, is projected to be up to $77.1 million in investment plus $24.0 million in City services offered in-kind, primarily in 2025 and 2026.

Planning for Toronto's participation in the 2026 World Cup continues under City leadership with the support of other key stakeholders. However, some uncertainties remain following the announcement of host cities by FIFA on June 16, 2022. Notably, detailed financial commitments to the costs of hosting the World Cup in Toronto have not yet been secured from the federal and provincial governments. While expressing support for Toronto's bid, detailed financial commitments from the Province of Ontario have been delayed due to the timing of the provincial election in June 2022.  The federal government has indicated that specific financial commitments will only be made once a national safety and security concept has been completed to inform the federal essential services component of the total event cost. The full security plan and associated costing is unlikely to be available until early 2023. In the interim, the federal government has indicated that it will follow the direction of the Federal Policy for Hosting International Sport Events. This policy sets limits on federal funding of international events. The federal government will cover up to 35% of total event costs and will not exceed 50% of the total public sector contribution to the event.

In its decision of April 6, 2022, Council authorized the Mayor and City Manager to accept the nomination as a Host City, even if full government funding commitments were not yet secured. As reported to Council in April, current indications from the provincial and federal governments and past experience for major events have led staff to be confident that suitable funding arrangements, as sought by City Council, will be secured. City staff will provide City Council with updates on any progress made concerning intergovernmental funding related to the FIFA World Cup 2026 in Q1 2023.

With Toronto now named a Host City, this report seeks the approval of City Council for City of Toronto staff to secure and sign a Multi-Party Agreement between orders of government and Canada Soccer, create the FIFA World Cup (FWC) Toronto 2026 Staff Secretariat, allocate funding from the Major Special Events Reserve Fund to support the advancement of project planning, evaluate and enter agreements in the interest of delivering World Cup matches in Toronto, and prepare financial plans for the City of Toronto to budget for up to $77.1 million in cash and $24.0 million in value-in-kind services, through the annual budget process in future years, as a matching commitment to funding from other governments within an overall project cost projected to be $300.0 million for the delivery of the World Cup in Toronto in 2026.