Proposal Includes Oakland Coliseum Sale Funds Not Yet Received by the City

OAKLAND – Oakland City Councilmember Janani Ramachandran (District 4) voted against passage of the City’s mid-cycle budget, which the Oakland City Council approved today by a 5-3 vote. This budget was balanced in part through the inclusion of anticipated proceeds from the sale of the Oakland Coliseum to the African American Sports & Entertainment Group (AASEG) despite the deal not yet being finalized and a Land Sale Agreement not yet being executed – a decision Councilmember Ramachandran believes could be devastating to Oakland’s future fiscal stability.

Under the budget passed by a majority of Council today, the Coliseum sale deal must be finalized and the City of Oakland must receive the first $15 million payment from the Coliseum sale by September 1st. If these sale proceeds do not reach the city by then, a contingency plan would be triggered, which would pose drastic cuts to vital City services – including reducing Oakland’s budgeted police force to 600 officers, temporarily closing five fire stations, and halting all City contracts.

“I am not only deeply disappointed but frankly shocked by the wildly irresponsible choice made today by the Oakland City Council to close this budget deficit with money we do not yet have,” said Councilmember Ramachandran. “With the sale of the Coliseum nowhere near being finalized, incorporating $63 million into this year’s budget from a future Coliseum sale is an ill-considered risk.”

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Whether or not the Coliseum sale goes through, the incorporation of these funds into the FY 24-25 is expected to have negative financial implications for Oakland, including a decline in the City’s AA+ bond rating, which in turn would threatening $200 million in scheduled capital projects – including those providing desperately-needed affordable housing for Oakland residents. In addition, Oakland would still face an estimated $100 million budget gap in next year’s biennial budget that will have to be closed through even more severe cuts or potentially layoffs.

“Our Finance Department was crystal clear on the risks of incorporating Coliseum sale proceeds into our budget,” Councilmember Ramachandran said. “Proceeds from this sale should have never been incorporated into this budget by the Mayor and City Administrator given how uncertain the close of the Coliseum deal has been.”

While not supportive of balancing the budget with proceeds from the Coliseum, Councilmember Ramachandran has supported the sale of the Coliseum to AASEG and last month voted in favor of the deal between the two parties.

Mayor Sheng Thao originally proposed a mid-cycle budget for the City Council’s review on May 24, 2024 – significantly later than previous mayoral budgets in Oakland and giving Council just over a month to review the proposal, have questions answered, and file amendments. In addition, an “alternative” proposal that excluded Coliseum sale proceeds was only presented to Council and the public on June 25th – a few days before the budget vote.

“This situation could have been avoided if Council had received budget proposals that did not include Coliseum sale proceeds from the Mayor and City Administrator in a timely fashion rather than releasing it at the 11th hour,” Councilmember Ramachandran said. “This year’s budget process has been an insult to the residents of Oakland, and it’s our residents who now will have to bear the consequences of today’s failure of leadership.”

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