- The Washington Times - Wednesday, November 10, 2004

The D.C. Council yesterday delayed by two weeks its vote on financing for a baseball stadium near the Anacostia River waterfront when council Chairman Linda W. Cropp introduced another last-minute alternative plan.

Mrs. Cropp five days ago proposed building the ballpark on the grounds of RFK Stadium.

Yesterday, she switched her support back to the Southeast site agreed to by D.C. Mayor Anthony A. Williams and Major League Baseball (MLB). However, she called for a major revision of the financing for the estimated $435.2 million stadium.

Mrs. Cropp wants to provide development rights to the ballpark to a consortium led by local real-estate investment executive Richard Gross, his attorney Fred Cooke and others.

The private developers would pay $350 million to build the stadium, then lease the facility to the Washington baseball team while the debt is paid off. The city would provide $150 million for land and infrastructure.

“We are still offering Major League Baseball a new stadium and on the site they prefer,” said Mrs. Cropp, who publicly has backed three different ballpark plans in less than a week. “But this will allow for more time for review of my plan, which I believe will offer substantial tax savings to the residents of this city.

“We’ve seen this sort of public-private model work with MCI Center, and I think it can work again.”

The political turbulence in the District worried many baseball insiders that the league is on the verge of a major embarrassment regarding its decision to move the Montreal Expos to Washington.

Baseball general managers at annual meetings in Florida privately expressed shock and dismay at the events in the District.

MLB executives publicly said they are not worried. They also have backed off threats to void the relocation deal, which were made in the wake of Mrs. Cropp’s short-lived effort to build at RFK.

The city has until Dec. 31 to ratify a financing package for the Southeast stadium site.

“It’s really still status quo for us. We’re interested in seeing the council reach consensus on the deal we struck with the mayor,” said John McHale Jr., MLB vice president of administration. “These sorts of things do happen when you’re doing a stadium deal. We’re still not getting excited.”

The new plan, presented to Mrs. Cropp late Monday, would allow the Gross group to get federal tax credits of up to $35 million per year in exchange for taking the financial risk of building the stadium.

When the stadium is paid off, after about 23 years, the developers would owe the District either $350 million or title to the ballpark. The latter option is most likely.

Mrs. Cropp said the plan would allow a drastic reduction of the gross-receipts tax on large businesses that is the core of the Williams financing plan.

The mayor intends to repay $550 million in bonds for the stadium with the gross-receipts tax, ballpark-related sales taxes and annual lease payments from the team.

City officials said last night they had considered the type of financing structure presented by the Gross group.

However, they were strongly advised against it because of ongoing efforts on Capitol Hill to close off some tax credits in leveraged real-estate deals such as this.

The late-arriving Cropp ballpark plan angered Mr. Williams and council members who support the current ballpark bill.

The council’s 12 other members learned of the new proposal yesterday morning in a private meeting with Mrs. Cropp, just minutes before a formal session of the council’s Committee of the Whole.

The meeting, according to several city sources, quickly escalated into tension and loud arguments.

The seven council members who support the current ballpark bill attempted to override Mrs. Cropp’s two-week tabling of the bill but could not get the necessary eighth and ninth council votes. Council procedure mandates a two-thirds majority to override a change to a hearing agenda by the chairman.

“This was absolutely the wrong thing to do,” said Jack Evans, Ward 2 Democrat. “I think she had an obligation to let this go forward and allow the elected officials to do their jobs. This is a really unfortunate abrogation of the process.”

Mr. Williams said his votes will “hold together” when the legislation returns for a vote on Nov. 23 but also criticized Mrs. Cropp’s tactics.

“I don’t think the way you do this is to delay a vote and put out a sole-source contract behind closed doors,” Mr. Williams said. “This is a classic example of a lack of transparency.”

Mrs. Cropp said if the private-financing plan does not materialize or threatens to violate key terms of the relocation deal with baseball she will “move forward immediately” to support the Williams plan.

The Gross group, which is scheduled to meet today with Mrs. Cropp and Mr. Evans, has had trouble in the past with a stadium deal and in its dealings with the District.

Property Funding Group, a District-based company led by Mr. Gross, was hired two years ago by the St. Louis Cardinals to help identify private funding sources for a new stadium.

The Cardinals fired the company after five months when one of the investors was named by the U.S. Justice Department as part of a federal terrorism investigation.

The investor, Yaqub Mirza, left the company and denied any involvement in terrorism.

During the 1990s, Mr. Gross served as legal counsel to T. Conrad Monts, who engaged in a lengthy and bitter legal battle with city officials over renovations to the John A. Wilson Building.

“If this is who is involved [with Mrs. Cropp], this is not a good thing,” Mr. Williams said. “[The Wilson] Building ended up being one of the worst real-estate deals we ever did. Why would we want to go back to the same person? To do so in the dead of night is just wrong.”

• Thom Loverro contributed to this report.

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