I’m treating the folder structure as what looks intuitively correct: “Department_Name” on level 1, “Department_Open” and team folders on level 2, and team-specific folders on level 3.
That said, I doubt anyone is going to be all that concerned about the actual folder structure when judging. My impression is that the event is mostly about how you handle reading and writing ACLs, and long paths (plus all the usual “best practices” and code style points that apply to every event.) Of course, I’m not a judge, and can’t read their minds. If we lose points for taking this approach, oh well.