February 8, 2006
Baseball's Rollercoaster Ride Comes to an End
As Ryan wrote earlier this morning, much of the District went to sleep last night thinking the stadium lease had been voted down, fearing that they may wake up to MLB announcing it was defecting to across the river. And surely enough, local newspapers thought much the same -- the Examiner's headline this morning reads "Council Rejects Stadium Lease Deal; Mayor Williams Cries Foul" while the Washington Times similarly proclaimed "Council Rejects Stadium Lease." We even started putting together our eulogy for baseball in the District, composing a post titled "Where Does Baseball Go From Here?" Only the Post benefited from a late deadline, titling their article "Council Closer to Deal on Stadium," but not before columnists Marc Fisher and Thomas Boswell had taken their swings at the council.
But the lease was ultimately endorsed on a 9-4 vote, and only after provisions were inserted into the legislation capping the total cost at $611 million and prohibiting the use of money from the sale of development rights to the surrounding lands from being used to cover any cost overruns on the stadium. Now it is up to MLB to agree to the lease, which, given the roller-coaster ride they have just experienced, should be a no-brainer.
This being the morning after, most everyone will have something to say as to why the lease was rejected and then approved. Many will claim that Linda Cropp played a key role, scaring some sense into wavering council-members by ensuring that the lease failed on the first try, making them fear being identified as the "council-member who lost baseball for the District." Others will give D.C. Mayor Anthony Williams, City Administrator Robert Bobb, and other high-level city officials credit for convincing and cajoling Marion Barry (D-Ward 8), Kwame Brown (D-At Large), Vincent Gray (D-Ward 7), and Carol Schwartz (R-At Large) into switching their votes. And many will still claim that the deal is a giveaway to a bunch of greedy millionaires, a sweetheart deal that will land MLB over $300 million in profit from the sale of the Nationals and cost the city untold millions in costs that have yet to be revealed.
In the end, though, the lease is now law, like it or not.
But there is plenty to be learned from an experience that began in late September 2004 and suffered from countless delays and postponements. First off, many believe that Williams did not effectively use the city's leverage to negotiate a good deal with MLB. From the beginning, the stadium agreement was known as "the sweetest of sweetheart deals" for MLB, and the minute the deal was signed, the District was left begging for concessions from a position of weakness. Worse yet, Williams did the least possible to convince members of the council that the deal would be good for the city in the long run -- he was either on the road or just not available, making his appearances before the council come to be known as "rare." His alleged negotiations never seemed to yield any tangible improvements to the lease -- the bad parts merely seemed to be shifted from one section to another. Members of the council do not escape blame, of course, with many of them playing politics and others seeming too timid to want to take a chance on a big risk that could yield big rewards. And in an instance where all judgement was abandoned, they hired consultants to review the lease who had prior worked for Northern Virginia's feeble attempt to attract that Nationals to their side of the Potomac.
We move on, though. No more marathon hearings. No more votes. No more speculating who would vote which way. The decision has been made, and as cliche as it sounds, there is but one thing we can say: Play Ball!
>>DCist on the stadium.
Picture snapped by ohad*.
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"And in an instance where all judgement was abandoned, they hired consultants to review the lease who had prior worked for Northern Virginia's feeble attempt to attract that Nationals to their side of the Potomac."
I'm really curious about this part. Did they really abandon judgement, or was this a thinly vieled attempt to have an 'disinterested' party provide another excuse to reject the deal?
> Now it is up to MLB to agree to the lease, which, given the roller-coaster ride they have just experienced, should be a no-brainer.
One would thing, but given the history of this issue I'm not taking anything for granted.
^think, not thing
typo
If MLB accepts the Council deal, one thing is for sure: it's a bad deal for DC. MLB does not accept bad beals for MLB.
If MLB accepts the Council deal, one thing is for sure: it's a bad deal for DC. MLB does not accept bad beals for MLB.
Uh...nice try kids. This supposed "cap" has a loophole wide enough for a spastic 8 year old to drive a monster truck through. We're all stuck for additional expenses.
Oh, BTW...this isn't over. Has anyone heard the word "referendum" defore?
"before"...typo
Fenty's ERA just took a beating.
I wasn't aware that they keep statistics in the bush leagues.
And now perhaps we can all focus on the myriad ways in which the DC government wastes *our* tax dollars every day (as opposed to the tax dollars of cooperative businesses and stadium users).
Since MLB has not commented on the approved lease yet. They could be awaiting a third DC Council vote on the lease -- perhaps a DC specific strike zone is looming? Or a lease that demands a certain percentage of the Nats to be DC born and raised? Or a lease that imposes special penalties for double parking near the stadium except on Sundays? We are waiting on the edges of our seats.
www.dcbubble.blogspot.com
Since MLB has not commented on the approved lease yet. They could be awaiting a third DC Council vote on the lease -- perhaps a DC specific strike zone is looming? Or a lease that demands a certain percentage of the Nats to be DC born and raised? Or a lease that imposes special penalties for double parking near the stadium except on Sundays? We are waiting on the edges of our seats.
www.dcbubble.blogspot.com
Since MLB has not commented on the approved lease yet. They could be awaiting a third DC Council vote on the lease -- perhaps a DC specific strike zone is looming? Or a lease that demands a certain percentage of the Nats to be DC born and raised? Or a lease that imposes special penalties for double parking near the stadium except on Sundays? We are waiting on the edges of our seats.
www.dcbubble.blogspot.com
well, at least we won't have to drive out 66 to go to "Second Amendment Field at Reagan Yards"
I think the council did a great thing for the city by voting for the lease. I’m sure many will not share my satisfaction, but that is democracy. Go Linda, Gray, and Brown! Boo Fenty and Graham!
The whole controversy is not over, I’m sure there will be a very contentious debate on what kind of development surrounds the stadium in the coming years. I hope that any new development will focus on maximizing tax revenue that can be used to pay down DC’s massive 4 billion dollar debt.
>I hope that any new development will focus on maximizing tax revenue
I don't. I hope any new development will focus on creating a good urban environment. Maximizing tax revenue = office ghettos like Crystal City. Far better to have a mix of residential and civic uses in there.
But we don't have to speculate. The plan is available online: http://www.ncpc.gov/publications_press/s_cap/NCPC_SouthCapitolSt.pdf
Um, a referendum on this matter isn't going to do anything -- they aren't permitted in D.C. for such issues. Don't let those silly anti-baseball flyers fool you.
the double parking on sunday near the convention center is a disgrace. all those sinners need to be ticketed. i cant believe they get away with all those sins.
we now have a cap. that's all we needed all along. where is all this anti-baseball money coming from? i mean they put alotta dough into the high-gloss fliers, phone banks. etc. where did all that money come from? and a referendum
will fail so dont even bother to waste more money.
bruce in adams morgan: you brought up the massive debt thing in a post yesterday, and another reader explained how you were incorrect in calling what "debt" the city has accumulated through bond issuances "massive". i'm asking (sincerely) why you bring this up again when it isn't correct. all municipalities have "debt" of this nature, just as a homeowner has massive debt due to a mortgage. it's not like the $4 billion could be called for all at once tomorrow.
if they didn't deman over priced union labor the bill would be alot lower, silly DC politico's. And the majority of people who build that stadium will live outside DC.
FURTHER the contrators make more money off union people, DC is soooo stupid
I would like to know what the loopholes are for raising this so-called "cap" level? This is DC and we all know DC isn't going to place hard spending limits on itself without future means to remove those limits.
Imgoph, I bring DC’s debt up in the baseball thread because bonds will be issued to pay for the stadium. Bonds will be also issued to pay for the schools and the new hospital. Other bonds were issued to pay for past projects. When DC’s tax revenue drops or is stagnant for some reason in the future (good economic times never last forever), the bonds will have to be paid regardless, out of our annual budget, requiring possible painful cuts to essential services. DC has a history of spend now, pay later that has burned us before. DC’s debt level and management strategy should be an issue in the coming election as we all know baseball will continue to be. Baseball has spurred and given momentum to a lot of spending in this city.
BeyondDC, thanks for the link to the proposed plan, I’m sure the council and the mayor will propose many changes to the plan. I too do not want to see Crystal City in DC. The grand open spaces and parkland will cost a lot of money to develop and maintain and will not directly generate any revenue; what surrounds that area must generate enough money to pay for it and maintain it (housing, retail, restaurants, office space).
Finally. I have dreamed of the day that the ignorant anti-stadium "followers" would be shut up. That day has finally come.
To all of you who hung your flyers and sent your emails to organize against the stadium...you may now suck eggs! what a glorious day.
And the pencil-neck who brought up a referendum...you prove why I call you ignorant. Do some research before you exhibit your lack of knowledge. Kind of like the stadium is taking money from schools.
this is great. baseball is back, and the there's nothing you idiots can do about it.
Yo DC Bubble-
Your comments above (all three of them) are identical to your comments on the Post's website. Really, please stop.
Bonds will not be issued to modernize the schools. The funding will be from sales taxes alone.
Bruce does bring up a good point, however, that DC does have a fairly high debt load. They are not going to have to pay it tomorrow, but it is a cost that cannot be cut if revenues decrease, and if revenues were to decrease enough, DC could risk default, which would put us right back in the position we were in the 90's. However, while this is something to be aware of, I don't think DC should be redeeming its bonds early or should be too gun-shy about issuing new bonds. It's all a question of cash flow, not a question of how large the debt is at any one point. And also, if DC were to begin to retire its debt early, Wall St. may start charging us a higher interest rate on bond issuances due to the increase early repayment risk.
If MLB accepts the Council deal, one thing is for sure: it's a bad deal for DC. MLB does not accept bad beals for MLB.
One of the dafter lines of rhetoric I've heard in a while, and quite the zealot (position over any interest in reason) grandstanding against baseball.
MLB isn't a perfect negotiator. Moreover, there are plenty of instances in which both parties benefit from the deals they reach. Maybe this is a good deal for the District, maybe not. But trying to push the criteria as "any deal the MLB accepts must be screwing us" insults the intelligence of people I assume you're trying to persuade.
Reid hits the finance nail on the head. It's all about cash flow. So yes, we will have a high debt load, however, municipal debt is open ended, not closed end like bonds. While the bonds are closed ended and will have a call date and those already issued have their call date, the city will issue more new bonds. The rates on these bonds aren't much above inflation as they serve as a significant tax shelter to many. Munis are tax free bonds.
Oh and I said it before, I'll say it again- pay for the cost overruns by not giving DC United a new stadium. They don't attract 1/3 of the baseball crowd nor do they come close to bringing in the revenue of the baseball crowd.
Sorry about the multiple post....I had a twitch honest.
www.dcbubble.blogspot.com
The staduim for DC United will not be publicly financed--the money will come from MLS (or some other private outfit, I'm not positive which is correct). In any case it's part of MLS's plan to build soccer-specific stadiums around the country (witness the Chicago Fire moving out of Soldier Field to their new stadium, the fabulous stadium where the Columbus Crew play, etc).
Also, DC United has already shown its commitment to doing more than just plopping their staduim down in some neighborhood they will ignore. They've committed to creating community sports leagues and other community projects--and I may be wrong, but I believe they've also committed to working on creating some affordable housing type stuff around the stadium.
So maybe I'm missing something, but not building the DC United stadium that will positively impact the community and not cost the city anything will mitigate the costs of the baseball stadium...how exactly?
"If MLB accepts the Council deal, one thing is for sure: it's a bad deal for DC. MLB does not accept bad beals for MLB."
I agree that MLB doesn't accept bad deals for MLB, but I don't think that necessarily means this is a bad deal for DC in the long run. Baseball in DC isn't necessarily a zero-sum game. Sometimes a negotiated deal benefits both parties.
As I understood the DC United deal the city would still be liable for capital improvements for things such as transportation and other public services. That is money that can be used to mitigate the baseball cost.
during the debate, vincent orange blew up and accused fenty of being disbarred.........anybody got any info
That may be true--I thought MLS was contributing at least some of that, but I could very well be wrong. However, even if they aren't contributing anything, I don't see the downside in the city investing money in a part of town that could really use the attention.
Even if soccer doesn't generate baseball-sized revenue, it's still a good step to attract service industry (and jobs) to Ward 8. 10,000 people who wouldn't otherwise be there once or twice a week or so is not to be sneezed at. Add in special events, concerts, international friendlies (the Chelesea game brought a huge crowd)...it's a major opportunity for development that is accompanied by major contributions to the community.
Conversely, not making that investment means that Ward 8 maintains the status quo, absent other major service industry development offers (I don't pretend to be an expert--perhaps there are others in the offing).
Again--what's the downside?
If the city wasn't strapped to provide for multiple stadiums I wouldn't see a problem either (besides the fact that soccer is one of the dumbest sports ever, but thats another story for another day), however with all the hubub about cost overruns for a stadium that will truly have a major impact on the city i find it silly that the united stadium gets no mention in all of this.