- The Washington Times - Friday, May 9, 2003

After falling behind in the race to enact public baseball stadium financing, District officials will now attempt to fast-track and ratify by July 1 a $338.7 million financing package.The proposed Baseball Revenue Act of 2003, which officially reached City Council offices late yesterday, represents what will likely be Washington’s final formal push to relocate the Montreal Expos. In the act are proposed measures to create a revenue stream of ballpark-related sales taxes to fund public bonds, as well as a return of the gross-receipts tax on large businesses that helped finance the building of MCI Center.Introduced by Mayor Anthony Williams, the timing for the baseball package is sensitive, as Major League Baseball intends to determine the new home for the Expos by mid-July. With two months to go before that deadline, MLB officials have made clear their desire to see as much actual stadium legislation on the table as possible. District officials, to many observers, have lagged in that race against Northern Virginia and Portland, Ore., in part due to 2004 budget deliberations dominating city time and resources.With the 2004 budget now approved by the council, this latest Washington stadium financing package calls for $275 million in public funds toward a $436 million ballpark; $15 million for improvements to RFK Stadium, which would be home to a local team for three seasons; $39.7 million to fund lending reserves; and $9 million in bond acquisition costs.Each figure is a significant increase from a preliminary financing outline given to MLB executives last winter in which total public stadium financing was not to exceed $275 million. It is also a giant step upward from the $200 million in public support originally offered by Williams to MLB more than two years ago. But city officials, repeating earlier mantras, said that none of the public money would come from existing general fund sources. The remaining funds for a stadium would come from private sources, such as individual owner investments, naming rights and luxury seat revenues.”It would send a very, very good message to have this done by the All-Star Game, but it’s not absolutely critical,” said Steve Green, special assistant in the city Office of Planning and Economic Development. “The more fundamental point, I think, is that we have put together a very sensible package that is conservative and leaves us a lot of coverage to weather economic declines, labor strife, or what have you.”The City Council recesses in late July, which also fuels the push for ratification. MLB owners meet in New York next week, and will be briefed by its relocation committee on the Expos.The ballpark-related taxes are estimated to fund about 45 percent of annual bond costs, while the gross-receipts tax would chip in another 35 percent. Williams proposes to tax businesses in the city with gross revenues exceeding $3 million a year on a graduated scale. The tax, which would exempt nearly 90 percent of city businesses, has the support of most of Washington’s corporate community. The rest of the public financing would come from a new tax on player incomes, which will arrive to the council later in separate legislation. The jock tax, however, also first requires a federal amendment to the city’s Home Rule charter to allow for non-resident taxation. A bill to do that specifically for baseball players is in committee on Capitol Hill, and could be approved by the end of May.The new D.C. package also outstrips proposed stadium financing in both Northern Virginia and Portland, the other two candidates for the MLB-owned Expos. Public-sector stadium efforts are projected at $285 million in Virginia and $150 million in Portland.D.C. Council member reaction so far is mildly enthused at best. Democrat Sharon Ambrose, whose Ward 6 contains the proposed stadium site along New York Avenue NE that is the preferred spot among most city leaders, has voiced deep reservations for any public financing for a stadium. Democrat Jack Evans, at-large member and chairman of the council’s finance committee, also remains highly concerned.”In the building of the new convention center and the MCI Center, there was no actual downside to our [city] bonding,” Evans said yesterday. “If revenues failed to meet projections, there were safeguards. What are the safeguards here? Just to say it won’t be an issue is not acceptable. I need to know who could be on the hook. We’ll have hearings and so forth, but I think there’s still a lot of concern among the council.”Green and other economic development officials insist revenue projections far exceed any estimated annual debt service burden. Actually using any bond insurance, the cost of which is included in the new financing bill, would severely damage the city’s future borrowing ability.Meanwhile, city officials yesterday outlined the results of a study they commissioned on the potential economic effects of a District-based team on the Baltimore Orioles. It found that a D.C. team would contribute to just a 4 percent decline in average Orioles attendance, and that 13 percent of the Orioles’ fan base comes from greater Washington.Both conclusions are almost identical to a similar study commissioned two years ago by the Virginia Baseball Stadium Authority. The VBSA study also concluded 13 percent of Orioles fans hailed from metro Washington, but argued a District-based team would inflict far more fiscal harm on the Orioles.But Orioles executives including owner Peter Angelos have insisted its reliance on greater Washington is much greater, at times claiming 33 percent of its fans come from greater Washington. The Orioles have forwarded its own research on the issue to several parties including MLB and Maryland Gov. Robert L. Ehrlich Jr.

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