- The Washington Times - Tuesday, May 10, 2005

District Mayor Anthony A. Williams yesterday endorsed the use of a debt financing package from Deutsche Bank to help construct the Washington Nationals’ planned stadium in Southeast, a move that brings him into political unity with much of the D.C. Council.

The mayor’s proposal, laid out in a memo sent yesterday to council members, calls for using a slightly revised version of the Deutsche Bank package certified in March by District chief financial officer Natwar Gandhi. In the memo, Williams backed using $246million in debt financing from Deutsche Bank, as was previously discussed. But instead of assigning specific revenue streams to pay back Deutsche and others to retire $313million in District bonds, one single ballpark revenue fund will pay back both lines of debt.

Williams staffers also had been developing an alternative financing proposal that relied heavily on public funds and threatened to re-ignite the stadium hostilities of several council members. But in the end, the administration elected to stay with the core of the Deutsche Bank plan, which Williams hopes will reduce the annual debt service on the stadium from $38million a year to $34million and the cost of the ballpark from Gandhi’s estimate of $607million to $586million.

“I believe that, of the private finance proposals, this revised Deutsche Bank plan is the most effective use of the revenue streams available,” Williams wrote in a letter to council chairman Linda W. Cropp.

Cropp played a lead role last fall in creating a formal search for private financing for at least 50 percent of the hard construction costs, hoping to lower the public-sector tax burden in the project. Cropp was not available for comment yesterday. The Williams memo arrived just as the council was completing a grueling, month-long deliberation on the city budget.

The revenue sources to repay the stadium debt, regardless of the level of Deutsche Bank’s involvement, remain intact: annual lease payments from the Nationals, ballpark-related sales taxes, gross-receipts taxes on large District businesses and utility taxes on large city businesses and federal government entities. The inclusion of Deutsche, however, would allow the District to transfer some financial risk in the venture, as well as lower its overall level of borrowing.

Yesterday’s memo from Williams follows up the stadium financing bill itself to amend the original stadium funding, submitted to Cropp 11 days ago with a legislative structure to include private financing into the project. It offered no pertinent details to the source of private funds.

Should the council fail to approve the inclusion of Deutsche Bank into the stadium package, the original plan relying solely on District bonds that was ratified in December will be used. The Deutsche Bank offer likely will satisfy the aims of Cropp and other council members, but debate still exists as to what truly constitutes private financing.

“It’s really the same deal we had before,” said Adrian Fenty, Ward4 Democrat. “I knew there wasn’t any real public financing out there. But if the vote is this deal or the original one, it’ll be 13-0 [for Deutsche Bank]. We obviously want a better deal out there if we can have it.”

The council’s finance and revenue committee, chaired by Ward2 Democrat Jack Evans, will hold hearings on the bill Friday and Monday. Williams and Gandhi will testify Friday, while Monday’s hearing is being eyed for public witnesses.

Area business leaders will be briefed on the mayor’s proposal today.

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