September 27, 2006
Fenty's First Challenge -- the Stadium
Mayor-to-be Adrian Fenty is probably marveling at the sheer irony of the situation -- a project he voted against may become his first challenge as the District's chief executive.
As the Post reported last weekend, the development plans for the area around the new stadium have largely fallen apart, virtually assuring that the April 2008 opening date will find the Washington Nationals playing in an area that remains desolate and under-developed. The problem? Developer Herb Miller couldn't secure the proper financing for two 13-story condominium towers adjacent to the stadium, a project that the Nats' new owners, the Lerner Group, were never much fond of. Instead, the Lerner's are pushing for the city to find enough parking for 5,000 cars, a prospect that may permanently limit the area's development potential and starve the city of the tax revenue they need to finance the $611 million in construction bonds.
And herein lies the irony. Fenty consistently voted against the public financing of the stadium, arguing that in one way or another the city would end us using public funds to finance the bonds. His concerns were often brushed aside by Mayor Anthony Williams and other baseball boosters who contended that the sheer development of the area and the increase in tax revenue would more than cover the yearly financing charges. The development may still come, but chances are that the city will take the easy way out and pave over enough lots to provide the requested 5,000 parking spots -- thus delaying any commercial or residential growth for years after the stadium opens.
What's Fenty to do? Well, he knows he can't pull out of the deal all together. Doing so would prove what his doubters always said -- that he's bad for business. Can he try and negotiate with the Lerner Group for something that balances the city's development needs with their parking demands? Yes, but not yet. He hasn't been elected officially (he's still facing the November general election), and authority or not, Williams won't be abandoning his perch in the Wilson Building any earlier than required by law. Though he soundly defeated Linda Cropp in the Democratic primary and will likely sweep the general election, Fenty isn't mayor yet, so his word only goes as far as Lerner and Williams are willing to take it.
As the Post opined yesterday, though, the situation may prove beneficial to Fenty. Should the development be delayed, Fenty could take office in January with the full authority as mayor to tell the Lerner's that like it or not, the area around the stadium will not be just parking lots. The city is only obliged to build 1,225 parking spots (it's the Lerner's that want 5,000) by April 2008. Everything else is fair game. If the development is delayed by a year, so be it. But it will come. Fenty may not have ever liked the deal, but now that it's set in stone, he may as well flex his muscles and let the Lerner's know that it's the city's stadium and the city's land. The District can't afford another RFK, and Fenty can't afford to explain to his base why public funds might be needed to finance the stadium's construction.
Image of stadium taken from Land of JD
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Mayor-to-be Fenty will have the city build a parking lot for 1225 spot and be done with it. He lacks the attention span and probably the vision to fully appreciate the positive economic effect of development. If there is a deal to be struck for development and a parking lot on the land then it will probably be put together by Jack Evans and Vincent Gray who understand such things.
Also, the city is not risking another RFK just because this one, albeit huge, parking lot will just be a parking lot. There is a great deal of housing and retail already in the works for the stadium area. D.C. will have another Chinatown with or without development on the parking lot land next to the stadium.
This is the old DC "affordable housing" story writ large. For every major condo development downtown, the city tries to negotiate setting aside a percentage for low/middle income, and the developers assure them that they'll include it. Then, when it comes to actual construction, wouldn't you know it, they "can't make the numbers work." Au revoir, affordable housing.
Williams negotiated funding for the stadium based on the assumption that mixed-used development was a given. Now, surprise suprise, they "can't make the numbers work." So both Williams and Fenty are in the same boat as Macbeth, "I am in blood/ Stepped in so far that, should I wade no more,/ Returning were as tedious as go o'er."
Logan,
Much like Fenty, Gray firmly opposed the stadium deal, and only came around when the deal was inevitable and he could gain political points by aproving the lease. Why is he poised to be your hero now?
I'm inclined to agree with Logan on this, but I admit that I was all for the stadium and that was one of several issues I was looking at in opposing Fenty. Still trying to work out who I'm writing in instead of voting for him.
More importantly, however -- Kudos to Monkeyerotica for working in the Shakespeare reference.
He's not. I voted for Kathy. However, I do think Gray understands what it takes to expand the city's revenue base.
300 parking spaces are already included (and funded) underneath the stadium on the south side of the site.
There are only 900 parking spaces that are needed on the north side of the site to complete the 1225 parking requirement.
Also, the city cannot build free-standing above ground parking garages since it is not allowed by the DC Zoning Commission and DC law. Mixed-use development on that site is the ONLY option. The DC Zoning Commission already rejected a backup plan to build free-standing parking garages on the site.
The city should have taken this into account before they approved funding for the entire project in the first place.
The question that everyone should ask is: Why did the city have the architects draw up renderings for two free-standing parking garages when the city (Mayor and DC Council) should have known full well that DC law prohibited it in the first place at such a site? I think this is a major oversight.
Make that: "only 925 parking spaces that are needed on the north side of the site to complete the 1225 parking requirement."
DC Stadium = fiasco
. . . say it a few times if it doesn't sink at first
Do the agreements state WHERE the parking spots must be? How about creating 1500 new spaces near the Springfield metro? :)
Rich, as a Springfield born and bred girl, I can assure you there is no room out there anymore either. Not a tree left in sunny Springfield.
Too bad that Fenty doesn't understand financing to actually make this happen. Say what you will about Cropp, but fiscally she understands how a budget and a city works. This should be an amusinc circus to watch.
Re #2 - Isn't this the fault of our sorry ass elected officials who lack the stones to provide for some sort of financial penalty for developers not including the promised affordable housing? Why is the city the only entity in this deal that has to hold up its end of the bargain? Is pulling the plug on the whole deal a realistic option?
the stadium should be known at 'Tony's Folly'
"Gray understands what it takes to expand the city's revenue base."
What, bending over and grabbing your ankles?
Hill Rat, I'm with ya: Is it too late to pull plug on this whole thing? Highly unlikely. But we would all be better off, in my small opinion.
Not to be a hater, I luv sports. But this is just not good at all.
It will never happen, too much loss of face for the pols involved and it's bad business for the city to boot.
Too late to pull the plug? Uh, have you driven down South Capitol lately? The stadium is halfway built.
A bit off topic, but there's a camera trained on the stadium at all times, and you can view current and past photos of its construction:
http://clarkconstruction.oxblue.com/clarkhuntsmoot/
Too late to pull the plug? Uh, have you driven down South Capitol lately? The stadium is halfway built.
Holy Fong! I had no idea they had done that much work already. It's amazing that a stadium will go up in half the time it took them to repair Thomas Circle.
Looks like the RFK site wasn't so bad after all. Now we get a stadium with no development around it (like RFK) but without the easy highway and Metro access that RFK has.
I don't know which option will be worse, taking the Metro, and being forced to wait up to 20 minutes after a game for a Green Line train, and being forced to walk a long distance to a station that is not designed to accomodate many people, or driving and having no easy way to access any of the region's major highways after the game.
Come to think of it, that drive up I-95 to Camden Yards is looking better and better.
Halfway built? Are we looking at the same pictures?
Any lots that the city would find to pave over for 5,000 parking spaces would not be anywhere close to the stadium site. As you can see at
http://www.jdland.com/dc/corridor-map.cfm
the properties directly bordering the stadium on the north and south are all spoken for by private developers, who already have plans in the pipeline. The adjacent WASA and Southeast Federal Center sites already have buildings on them, only WASA could possibly get paved over, and the city has already said they want to put 800 residential units on that site. Perhaps Florida Rock to the south might offer some spaces on the western side of their property, since their project (starting construction in early 2008) will move east to west.
But can we please stop saying that the death of the Miller deal is the death of the Ballpark District? The Miller deal covered two blocks, and as you can see from the map linked to above, there's all sorts of projects by commercial developers that are moving forward whether the Miller deal did or not.
Nice map and key, JD
Thanks JD. The same folks saying the development is going to fail are the ones who said the stadium is being financed by general fund money that should have gone to the schools.
"... and having no easy way to access any of the region's major highways after the game."
Do any of you even look at a map before commenting? South Capitol Street and M Street, SE both take drivers to major hightways. I think the driving discussion is as blown out of proportion as is every other discussion surrounding the stadium.
There's no way in hell the DC Office of Planning will ever approve surface parking. Thank goodness for that because the Lerners insisting that they need 5000 spaces is just asinine.
The stadium is only 2 blocks from a Metro station. It doesn't need any parking at all. The Verizon Center and the new Convention Center have no public parking and they're running swimmingly. We have a great public transportation system, why not take full advantage of it?
Plus JD is right, there's absolutely no reason to be freaking out about these two little blocks of development. There's millions and millions of square feet planned for the remainder of the neighborhood that will be going up no matter what. A lot of it is already under construction, check out her site at www.jdland.com/dc for proof. So DCist please please stop telling everybody that the area around the stadium will be "desolate and under-developed" in 2008 because it won't be.
-Jim
SWester - As far as I can tell, Navy Yard is closer to the new stadium than Stadium/Armory to RFK. Also, I believe there will be modifications made to the station to accomodate the increased ridership. I'm not sure why you think the situation will be any different than it is at Stadium/Armory. The stations appear to be the same design (2 entrances, center island platform).
Fenty will have no time to deal with this nonsense; he will be busy filling potholes and fixing streetlights with his BlackBerry. Perhaps he could dispatch Sinclair Skinner to negotiate a new deal with the Lerners. Maybe he could print up some clever little newsletters to hand out, as well.
Adrian Fenty is a 21st-century Marion Barry, I'm afraid.
I love how any post that mentions Fenty becomes a grand Fenty-poking party. Nothing like a negative presumption to spice up an otherwise adequate discussion!
Using M St or S. Capitol St to get to 295 is not a major highway connection. Not compared to RFK, Camden Yards, Citizen Bank Park (Philly) or even Yankee Stadium. The majority of fans will drive, that is a fact of life and those fans should not have to drive for several blocks on surface streets (each with lights at every intersection) to get to a highway. There should be an entrance/exit on site.
As for the Metro, that station is one of the least utilized in DC proper and can not safely handle any type of large crowd. There is simply not enough room. Now there is a plan to upgrade the station, but it remains to be seen if that can be done in time for opening day. Also, remember, Navy Yard is served by one line, RFK by 2 and RFK's location allows Metro to start and end special trains there. I have not heard if Metro can do the same thing at Navy Yard.
It looks like SWester will be going to Baltimore games from now on.
"DC Statdium = fiasco" is wishful thinking without any basis in fact or reason. As long as the District continues not to take a single dollar from the treasury, and continues not to raise our personal income or property taxes by even one penny, to fund the stadium project (which is the status quo under the financing plan, though most people never seem to grasp this), then the District comes out ahead on literally the first dollar of economic development, created by the stadium, that goes into the general fund.
That means the first tax dollar or business license dollar from, e.g., any new business created by the existence of the stadium, will be a net gain in the DC coffers. And most of those dollars will be coming from VA and MD taxpayers, amounting to the District's first commuter tax.
DCist Martin loves to sprout lies every time he writes a stadium-related post. The most brutal lie this time:
"a prospect that may permanently limit the area's development potential and starve the city of the tax revenue they need to finance the $611 million in construction bonds"
Martin, please identify the portion of the $611 million that is funded by tax revenue from development surrounding the stadium.
It's not being funded by general funds that "should have gone to the schools" -- it's funded by imaginary funds provided by development which has yet to materialize at the projected oversold pace. Most of the development around SW was underway well before the stadium site was even selected (but please, give all the credit to the mighty half-built stadium), largely due to the relocation of thousands of DoD staff to the Navy Yard
STOP THE MADNESS!!
There is another way.
But, unfortunately, we don't have the kind of leadership in this town with guts or brains to do this kind of deal. Don't count on Fenty either!
CHECK OUT THIS OUTSIDE-THE-BOX IDEA:
http://www.mooreforpeople.com/html/dennis_moore_for_dc_mayor.html#EllingtonCenter
For the umpteenth time:
The DC Baseball stadium is being financed through a business tax on businesses in the city and through the continuation of a utility tax on the federal government. The business community, as a whole, supports the construction of the baseball stadium.
And to DC Stadium = fiasco:
The DC baseball stadium is an economic accelerator for the Near Southeast neighborhood in that it is speeding up development in that neighborhood where the developers, if not for the stadium, would have built an office park. The city does not need another generic office park. Now developers, because of the stadium, are and will be building more residential and retail projects which will trigger increased income tax and sales tax that will go directly to the general fund.
The Florida Rock project that is directly south of the stadium has just agreed to add 3 levels of retail to the first phase of its project, and they are also adding a 39,000 sq. ft. public plaxe which will lead from the stadium directly to the Anacostia River. These change of plans are directly related to the stadium and will add to the DC General Fund due to increased sales tax revenue from the increased retail space on the site.
I guess DC residents, generally, cannot fully grasp the concept that they are not funding this stadium. Businesses are funding this stadium - and the federal government through a utility tax. Even if they need to raise the cap on constuction spending (which I believe they need to do), DC residents still will not be funding this stadium. The amount of money that the DC government is taking in through its stadium tax on businesses is more than they expected.
Who on here does not understand this by now? Let me know. I will walk you through it.
So, lets make a wish and believe that businesses won't pass their costs onto DC residents in very creative ways. A long-winded special interest explaination does not hide a simple fact: We will still pay for the stadium one way or another.
P.S. - I read the mooreforpeople link. Looks like I'm not voting for Fenty in November.
FYI:
All DC businesses do not have to pay the special stadium tax. The largest of businesses pay the stadium tax. Most small businesses in the city do not pay the stadium tax. Small businesses make up 99.7% of all US employers. Most businesses in DC are small businesses.
Connect the dots.
Well done, Octavio and A.R.! I think many people on this site (as well as DCist) needed that clear explanation.
Dear SWester,
With comments like this one:
"The majority of fans will drive, that is a fact of life and those fans should not have to drive for several blocks on surface streets (each with lights at every intersection) to get to a highway. There should be an entrance/exit on site."
...I have no choice but to assume that you are a moron. Please move to somewhere in South Dakota or Idaho or some other boring sprawl-ridden wasteland, which is obviously where you belong. that is all.
The considerable majority of large businesses in DC that are subject to the stadium tax are huge law firms, lobbying firms, etc. Somehow I doubt they will be 'passing the cost on' to the average DC taxpayer.
I'm so glad someone so clearly explained the stadium financing.
I was on the fence about the stadium during a lot of the debate (not like anyone asked my opinion).
What swayed me to support the stadium was the outright lying that the stadium opponents did about the funding. They kept insisting that stadium funding was somehow going to result in DC schools and police getting less tax money.
That was simply an outright lie. In the end, DC schools (which we grossly overfund already) and police and such will actually get more tax revenue, as the revenue the ballpark area will bring in over the next few decades stands to be stupendous.
Yes, there would have been some development down there anyway, in particular right next to the Navy Yard. But every developer I've ever heard quoted says they are going in down there because of the stadium, and they are going in with much larger projects (including highly taxable residential and retail) because of the stadium.
That was simply not possible at RFK. Why not? We would have heard CONSTANT complaining about it from my fellow Hill dwellers that live around the stadium. And, the Feds own RFK and all the land around it. Their charter to DC does not allow for development. Period.
The detractors on this thread remind me of Vice President Cheney as he continually insists Iraq helped out with 9/11, causing us to attack. As I read all 42 of the comments on this thread, I cannot help but notice that unlike months back when the stadium deal was being debated, the majority of the comments are now pro-stadium, correcting the detractors lack of correct info, and pointing out how Fenty is completely weak on this issue (which is why he voted the way he did). This makes me almost as happy as the fact that we aren't going to get stuck with a L'Enfant Plaza Part 2 neighborhood... "because that development would happen anyway". Yeah, right, and there would be a bowling alley and a movie theater in Chinatown if Verizon Center wasn't built. And keep in mind all of that happened inspite of the fact that the Wizards and the Capitals are consistently bad teams. I can't afford Wizards tickets, but I can tell you that the Capital games are NEVER sold out, not even close.
The Lerners are envisioning another Tysons Corner in SE DC. Boxy office buildings with minimal ground-floor retail surrounded by parking garages. Sounds exciting. Put in the required 1,225 spaces, flex a little muscle with Ted Lerner, and make sure this area gets developed right. This is the biggest opportunity the city has had in years for re-development and to increase the tax base. There is a blank slate waiting - don't screw it up.
I wish that just once DCist Martin would post within the comments in a stadium-related thread a response to our descriptions of the ACTUAL stadium financing plan, not the one he invented. Hey Martin, why don't you answer my question, or disput what Octavio and A.R. wrote? Because you can't. I guess we'll just have to wait until the next time you post about how the DC taxpayers are going to be footing the bill for a baseball stadium.
While you'll never say it, you are admitting that you don't have an argument when you consistently lie about the funding plan. You type in proper grammar, so you are smart enough to know that the DC residents are paying NOTHING for this stadium. So we know you are lying. The reason you have to lie is because the truth kills your entire argument, that the stadium is a waste of money. If the truth was on your side, you'd use it.
CD - What is "right"? Did you read any of the other comments?
I'm with you Anna and Brooklander. The hype about the cost/benefit ratio is out of whack. Has anyone entertained the thought of what the Nationals Stadium deal is going to cost DC when this loser team doesn't make the real money the owners/politicians are gambling on earning in the next 10+ years? No one in Virginia or elsewhere, only us suckers in DC, could have been bamboozled on such a shaky deal. Remember the hoopla and hype over what RFK Stadium would do for DC? Oh yeahhh!
Nat:
How successful the Nats are or aren't is only a small piece of the pie. Far more important is all the retail, residential, etc. that is going in around the stadium.
That development would never have happened without the stadium. Period.
The entire reason RFK didn't make more money for the city is that it's surrounded by parking lots and low income housing (although the neighborhood is slowly changing). There was no chance for additional tax revenue, additional housing, etc.
Clearly the new stadium has tons of additional revenue associated with it. All you have to do is click on the links JD Land provided.
Even if the Nats lose every game forever and their owners hemmorrhage money, the city still wins because we get all the residential and retail around the stadium. That's hundreds of millions in tax income over the next few decades.
Would you Moore for Mayor losers please stop your postings? This isn't a forum about the Mayors race. So stop it already.
I also read the Ellington Center idea by write-in DC mayor candidate Dennis Moore.
For a REPUBLICAN!!!, he's seems ahead of the curve on solutions and what really matters in DC.
Change and real new ideas are not always easy to swallow.
But this could be the first Republican mayor I can live with as a Democrat.
I like his family-friendly-people-first-pro-business-community-partnerships-DC-development spin. Though it may be a tad too detailed for most casual DC voters.
Writing-in someone better can be lot easier than pushing a button for someone worse.
Remember Barry and Pratt-Kelly?
Besides, based on his DC Council performances, I am leery about Fairweather Fenty.
The pro stadium blowhards need to continually justify their case because it's remarkably lame. Just seeing construction cranes doesn't mean shit.
Regardless of the revenues generated vs. cost outlay, DC is on the hook for $611 million and counting. However much the supporters wish to state their assuredness about revenues, such revenues are not a given, and any shortfall will result in a budget deficit to finance the bonds. It's really that simple. How they wish to sell that deficit and the resulting budget decisions are matters for the politicians.
The only winners are the Lerners, MLB, and the Nats fans who fill 1/2 of RFK on a regular basis.
Troll Feeder says "DC is on the hook for $611 million".
That just isn't true. Once again, the tax is on very large businesses in DC. NOT on the average DC taxpayer. Law firms and lobbying in DC is about as stable a business as you can find on the planet. That income stream ain't going anywhere.
Fairweather Fenty? That works for me too! In the meantime, can Hillman the Hack stop his special interest political rants. Last time I checked, DCist made this a free speech blog. Besides Hillman, if you read beyond your own self-serving viewpoint, the comments about Dennis Moore's idea of Ellington Center has everything to do with the topic at hand. Grow-up, rent a brain, or get-off somewhere else.
Assuming what the pro-stadium folks are saying is correct, here's what I understand to be the deal:
DC is floating a $611M bond to pay for the stadium and the debt service on the bond will be paid for by a dedicated funding stream, a tax on large DC businesses.
Here are my questions for the pro-stadium folks:
1. Where does the money come from in the event of cost overruns?
2. What happens if DC's credit rating slips and the debt service increases?
3. What's to keep the taxed big businesses from launching a concerted campaign to have this tax abolished, thus bringing down the whole financial house of cards?
Hillman,
You clearly demonstrate little knowledge about the nature of taxation. Regardless of who compensates the District for the outlay, the District bears the debt burden. There seems to be an assumption that the business taxes, et al will cover an infinite cost outlay. There is a price point where the cost of building the stadium would outweigh the PROJECTED tax revenue. The tax revenue is projected -- the debt is a given.
bump
Again, for those who continue to attempt to separate the "business tax" from the taxpayers, the business tax is a new tax that could be used to support a myriad of needs in the city. Raising taxes now for a stadium makes it harder to raise taxes now and in the future for those needs. This also makes it more difficult to lower taxes now and in the future for DC residents.
And as virtually every independent economist argues, even the most successful stadiums do not generate enough economic activity and revenues to justify large public subsidies, let alone at least $611 million, plus all the risk. Almost anything else on that site (the development of which would be happening anyway), would generate more for economic development purposes than a stadium. As University of Chicago economist Allen Sanderson has famously said, you'd create more economic impact by going up over your city in a helicopter and tossing the money out the window than by building a pro sports stadium.
Shawn, allow me to give 2 pointers regarding the "independent" economists:
1) Most economists are conservatives who oppose government subsidies for ANY economic development, not just sports stadiums.
2) The economists are wrong. Their main argument for sports stadium subsidies not bringing back justifiable revenues is that the people who attend sporting events would be spending their money in some other fashion (such as at a movie or restaurant) if there were no baseball game. This argument holds no water because (a) most of the Nats fans are from Virginia, and they don't go into DC to see movies, and most stay in VA even for restaurants, and (b) most fans will do dinner AND the game in DC, meaning you've doubled up on your "nights out" from those people.
Economists, like any profession, are not always right. This is one of those cases.
MKE - That is some powerful Kool Aid you're drinking.
The primary argument against sports stadiums is that they do not generate any NEW spending. New spending is also know as growth, which is the real economic driver for a city or region.
Where is this info that "most fans will do dinner and the game in DC" coming from? Game time is 7:05, who has time to make the trek in from the hinterlands of Reston or wherever, sit down at restaurant to have dinner and make it to the ballpark by 7pm? If you're calling $6 hot dogs at the park dinner, that spending has long since been factored into projected stadium revenues.
Wow -- it's comforting to know all those VA plates in Adams Morgan every night are just looking for street parking when they come to visit the stadium. I was worried that my neighborhood was regularly overrun by assholes.
OH YEAH!!!
MKE wrote: "1) Most economists are conservatives who oppose government subsidies for ANY economic development, not just sports stadiums."
Regarding the new DC stadium, economists writing on the economic impact run across the ideological spectrum, and they are ALL in agreement. As stated in a letter (signatories below) to Mayor Williams from 90 economists on October 21, 2004: "A vast body of economic research on the impact of baseball stadiums suggests that the proposed [then] $440 million [now at least $611 million] baseball stadium in the District of Columbia will not generate notable economic or fiscal benefits for the city.... It is dubious to justify the use of public funds to subsidize construction of a DC baseball stadium on economic development grounds."
MKE wrote: "2)(a) most of the Nats fans are from Virginia, and they don't go into DC to see movies, and most stay in VA even for restaurants, and (b) most fans will do dinner AND the game in DC, meaning you've doubled up on your 'nights out' from those people."
Even taking into account that the new facility "may shift some entertainment spending from the Maryland and Virginia suburbs to the District," the signatories noted that this outcome is not likely to justify the outlay of tax dollars. Nor is a stadium likely to lead to an economic renaissance in Anacostia, because few of the financial windfalls accrue to neighboring businesses.
MKE wrote: "The economists are wrong."
These 90 economists -- who took the time to express their expertise to Mayor Williams -- would say otherwise, and they are backed-up by studies and evidence (sorry for the length, but there are just so many in agreement, and I thought MKE might like to investigate their ideologies):
Henry J. Aaron, Brookings Institution; Geoffrey Andron, Austin Community College; Robert A. Baade, Lake Forest College; Charles W. Baird, California State University - Hayward; Doug Bandow, Cato Institute; Andy H. Barnett, Auburn University; John H. Beck, Gonzaga University; M. Douglas Berg, Sam Houston State University; David J. Berri, California State University - Bakersfield; John Berthoud, George Washington University; Elizabeth C. Bogan; Princeton University; Samuel Bostaph, University of Dallas; Scott Bradford, Brigham Young University; John B. Bryant, Rice University; Dennis Coates, University of Maryland - Baltimore County; John P. Cochran, Metropolitan State College of Denver; Christian Crowley, George Washington University; Otto A. Davis, Carnegie Mellon University; Gregory J. Delemeester, Marietta College; Craig Depken, University of Texas - Arlington; John Dobra, University of Nevada; Robert M. Dunn Jr., George Washington University; Frank Falero, California State University; Arthur Fleisher III, Metropolitan State College; Micah Frankel, California State University - Hayward; Kenneth R. French, Dartmouth University - Tuck School of Business; Dennis E. Gale, Rutgers University; John M. Gandar, University of North Carolina - Charlotte; David Garthoff, The University of Akron; David E.R. Gay, University of Arkansas; Otis Gilley, Louisiana Tech University; David Gold, New School University; Peter Gordon, University of Southern California; Dennis Halcoussis, California State University - Northridge; Robert Hahn, AEI-Brookings Joint Center; David R. Henderson, Hoover Institute; Pat Hendershott, University of Aberdeen - Scotland; Brad Humphreys, University of Illinois - Champaign-Urbana; F. Jerry Ingram, The University of Lousiana-Monroe; Bruce Johnson, Centre College; David L. Kaserman, Auburn University; Raymond J. Keating, Small Business Survival Committee; David Laband, Auburn University; Thomas M. Lenard, The Progress & Freedom Foundation; Stan Liebowitz, University of Texas - Dallas; R. Ashley Lyman, University of Idaho; Doug MacKenzie, Ramapo College of New Jersey; Michael L. Marlow, California Polytechnic State University - San Luis Obispo; Victor Matheson, College of the Holy Cross; Fred S. McChesney, Northwestern University; Carlisle Moody, College of William & Mary; Richard F. Muth, Emory University; Roger Noll, Stanford University; James B. O'Neill, University of Delaware; Jeffrey Owen, Indiana State University; Allen Parkman, University of New Mexico; William S. Peirce, Case Western Reserve University; Philip Porter, University of South Florida; Barry W. Poulson, University of Colorado; Richard W. Rahn, Discovery Institute; W. Robert Reed, University of Oklahoma; Jay R. Ritter, University of Florida; Paul H. Rubin, Emory University; Raymond Sauer, Clemson University; Martin Schmidt, College of William & Mary; Michael A. Schuyler, Institute for Research on the Economics of Taxation; Carlos Seiglie, Rutgers University; Stephen Shmanske, California State University - Hayward; Rich Shields, Keller Graduate School of Management; William F. Shughart II, University of Mississippi; John J. Siegfried, Vanderbilt University; Neil T. Skaggs, Illinois State University; James F. Smith, University of North Carolina - Chapel Hill; Mark Steckbeck, Hillsdale College; E. Frank Stephenson, Berry College; Courtenay C. Stone, Ball State University; Alexander Tabarrok, George Mason University; John Tatom, DePaul University; Henry Townsend, (retired); Leo Troy, Rutgers University - Newark; Richard K. Vedder, Ohio University; Scott Wallsten, American Enterprise Institute; John T. Wenders, University of Idaho; Robert Whaples, Wake Forest University; Walter E. Williams, George Mason University; Dennise P. Wilson, University of Texas - Arlington; Gary Wolfram, Hillsdale College; Kate Zhou, University of Hawaii; Andrew Zimbalist , Smith College; Benjamin Zycher, Pacific Research Institute
Shawn - I think you laid it on a bit thick . . .
It's not that the economists don't think a city should spend money on a stadium, it's that they disagree with the justifications.
Most economists agree that the economic activity will not cover the WHOLE cost of a stadium. But they will agree that it can offset the cost of the stadium. As for whether this offset cost is justified, frankly that's not the job of an economist. I'll agree that stadium proponents have been either wrong or disingenous to say that the economic activity will entirely pay for the stadium, but the opponents have also been disingenuous by not acknowledging that at least some of the cost of the stadium will be offset. The end result is that we get a new stadium for an effective price well below the 600 million. Having a team and a new stadium has some worth to the city, and we may agree that it is equal to whatever the remaining cost of the stadium is. Even the economists would agree with that.
Opponents of public financing for the DC stadium seem less vocal of late because most of us are resigned to the bad deal in place and would rather see it succeed than fail, if for no other reason than the potentially negative consequences for our city should it fail. The perceived degree of success/failure will likely be as contentious as the plan itself. I'll concede that we're stuck with a rotten deal, but I'll still call bullshit when it stinks.
Getting back to the original post -- Fenty is uniquely positioned to shape some corresponding components of the deal for a more favorable outcome than Williams, who exhausted every ounce of political capital just to make it happen. Hopefully Fenty will continue to be skeptical about the irresponible claims made by proponents of the publically financed stadium, even if he's stuck with the principals of the deal.
East of the River: If you think I'm somehow shilling for a special interest, please pony up some proof. Otherwise, please stop impugning my good name.
As for Moore shills invading this forum, their postings aren't about the stadium. They are whoring for a political candidate generally. Big difference.
Again, pony up some proof of my supposed special-interest affiliation.
Troll Feeder:
What you are suggesting is theoretically possible but isn't likely. The tax is on big businesses in DC (law firms, lobby firms, etc.). These businesses simply aren't going anywhere. It's probably one of the most stable revenue streams on the planet.
True, the revenues coming in from the massive development around the stadium are a bit more difficult to quantify. But just a quick look at what's going in down there would indicate that the tax revenues (continuing, by the way, for decades) is going to be massive. Hundreds of millions of dollars. And that's all in addition to the special big-business tax revenue stream.
Shawn:
You say the special business tax for the stadium could have been used for other purposes.
Once again, that just isn't true. The business community almost universally actually welcomed this tax as long as it was dedicated to the baseball stadium. They would not have supported a special tax for, say, another half billion thrown into the money pit that is the DC public school system.
This tax passed only because it had the support of these businesses.
A similar tax proposed for any other purpose would have been dead on arrival.
As for this tax making it more difficult for lowering taxes on DC residents in the future.... that's just not a supportable argument. First, do you really think any DC politician is actually interested in lowering taxes? Second.... once again, this is NOT a tax on your average resident. It's specific to big businesses only. What tax burden big businesses have has no real relationship with what rate DC politicians think they can tax regular residents.
Hill Rat:
Not all games are 7:05. Many are on weekends, and earlier on weekdays, etc. Many of those games would be conducive to dinner in the 'hood.
But the new restaurants and such getting revenues from actual game-goers is really a tiny part of the overall picture. Just the fact that you'll have thousands of new residents moving into the high-ass condos down there and the fact that you've got massive new residential, office, and retail going in...... that's the real economic benefit. The actual stadium revenue is almost a side benefit.... Just the real estate and income taxes from several thousand new residents, plus the new hotels and offices (all of which pay income and real estate taxes....)..... the list goes on and on.
Assume only 2000 people move into all these new condos and such. Assume a salary of $100,000, which is what it will take to afford these new condos. Roughly, that's $16 million just in income tax revenue, per year, from these new folks. Add of course their real estate taxes, all the tax on everything they buy, etc.
And there's the hotels. Average say $200 a night. Every hotel stay nets the city $30 per nightly stay just in the hotel tax alone. That adds up pretty quickly.
We're building an actual destination neighborhood down there.
One added benefit - the SW waterfront will now have an actual decent neighborhood to the East. That'll greatly facilitate development in SW, as people are much more likely to develop housing and such when they are no longer living next to what they perceive to be unsafe slum conditions. You'll see a lot more high-end (read: more tax revenue) development along the SW waterfront and in SW generally.
Yet more tax revenue for the city, for decades to come.
And, yes, there is a very real value to actually having major sports in town. It's hard to put a dollar figure on that, but cities without sports teams are viewed as piss-ant backwaters, and sports teams do make the entire area more desireable, both for the individual and for companies seeking to locate here and lure workers to work for them.
And having a MLB team in DC really does help the city on a strictly emotional level. We do have a lack of identity locally. This helps us actually feel like a real city, a real place. Is that sad? Yes. But it's true.
Do I think we negotiated with MLB poorly? Yes. But 20 years from now it'll probably seem like a very solid investment.
This from today's Post....
$800 million project planned for the SW waterfront.
Does anyone think this would have happened if the ballpark area had remained a slum?
http://www.washingtonpost.com/wp-dyn/content/article/2006/09/28/AR2006092801442.html
HILLMAN!!! You have way too much time on your hands to be blogging 24/7. Why work when your bills maybe paid by a special interest. Save some space for someone else, without an agenda, to blog here.
Washman:
Where is your proof of my 'special interest'? Please, be specific. You've claimed I'm actually being paid by some special interest.
And exactly, specifically, what do you think my 'agenda' is?
Go ahead. Pony up the proof.
I'll save you some time. I have no ties to developers in the ballpark area. I have no property there, and I have no economic interest in it, other than the basic economic interest all DC citizens have.
So piss off with your baseless accusations already. It's tiresome, dishonest, and rude.
Shawn:
You say " Nor is a stadium likely to lead to an economic renaissance in Anacostia, because few of the financial windfalls accrue to neighboring businesses."
The stadium isn't in Anacostia.
And all you have to do to see the financial windfall to the baseball stadium neighborhood is look at the map JD Land was kind enough to do up. The effects are fairly phenomenal. Yes, some of that would be there regardless (particularly the SE Fed Center). But most would not, in large part because part of this deal with the city getting their act together and razing a lot of the crappy public housing in the area. That would have never happened if it hadn't been for the baseball stadium and because with the stadium the entire area is being developed as a destination neighborhood, not just some crappy office park (or, more likely, continuing decades of public housing, crappy clubs, and empty lots). Should it have happened without the stadium? I'd argue yes. But realistically it wouldn't have.
Do I think we negotiated with MLB poorly? Yes.
I think this is probably the source of my skepticism and discontent with the stadium deal more than anything else, we didn't negotiate from a position of strength. We went to MLB hat in hand, begging for whatever shit deal they would give us. Does anyone really believe that MLB would put a team in Portland over DC? Hell no! And even though Vegas has much to offer MLB, the hypocrisy of American professional sports will probably keep MLB, NBA, and NFL out of that market forever. So for Williams to just give away the store is pretty unpardonable IMHO.
"Nor is a stadium likely to lead to an economic renaissance in Anacostia, because few of the financial windfalls accrue to neighboring businesses."
This was an argument from the 90 economists who debunked Mayor Williams' claims, not from me. Here's the quote from the letter:
"Research also suggests that a baseball stadium alone will not revitalize the Anacostia waterfront. Because sports stadiums are not used most of the year, they do not stimulate much development outside the stadium. Most modern stadiums include restaurant and other entertainment offerings, limiting the money that goes to neighboring businesses."
Anyone believing that the Nationals Stadium will be a major long term economic benefit to DC needs to take a trip to Bronx NYC and the neighborhood surrounding Yankee Stadium. Within 10-minutes of walking the neighborhood anyone will see the future we will face here. DC seems to always be 20-30 years behind urban reality. Even when it comes to the boosters and hustlers behind the hype that hides our fiscal doom. After reading Republican write-in candidate Dennis Moore's Ellington Center idea --- though he will certainly lose in November --- he is a winner in outside the box thinking --- a standard of thinking (perhaps leadership) uncommon to the public officials who will slowly pick our pockets to pay for the Nationals Stadium.
Actually, anyone that wants to see the future around the ballpark just needs to look at the map JD Land posted earlier in this thread.
Might it eventually turn into a slum? It's possible, but not very likely.
Fiscally speaking, DC does not have the luxury and time to engage in the gamble of a possible economic benefit from a shaky big-ticket project. My best sense and view of the numbers is that DC is still on shaky fiscal grounds, and public officials are trying to sell-off land and grab for any deal to keep the District afloat.
The real story is that DC is actually on the course toward a period of major economic deficits started by reckless public spending, the usual incompetent governing and phony revenue generating projects. After over 30 years of living in DC, anyone who thinks Fenty is a better version of a new vision hasn't been paying attention to DC's deterioration and population changes.
Economics 101, regarding basic cost/benefit ratios, teaches that you are bound to lose more and fail when the actual costs are larger than the immediate and long-term economic benefits. In other words, don't spend the mortgage and tuition money on a fancy new car that loses value after you leave the dealership.
There's no doubt, those who lend lip-service support and creative distortion to this special interest boondoggle won't be so vocal about solutions to get DC out of the financial mess the new stadium will dump on DC.
Hopefully, the less vocal majority of DC voters who never voted for this project (or in the September 12th primary) will act more aggressively against the political and financial hucksters draining the economic life and social character out of our city.
Right. Because Near Southeast was just brimming with economic life and social character. I'm not so sure the city's vocal majority needs a few tons of concrete or wants to butt-bang a 65-year-old male prostitute in an alleyway.
I'm not so sure the city's vocal majority needs a few tons of concrete or wants to butt-bang a 65-year-old male prostitute in an alleyway.
Wow. Way to court the antigeriatric AND homophobic vote. Although, it's still a tie with Williams and the anti-"niggardly" crowd. He did manage to lock-in the hard-of-hearing AND illiterate vote.
Monkey - While I see your point about the whole "niggardly" flap back in the day, I have to wonder about the judgement of someone who would choose a word that's so easily misinterpreted. It's not like there were no other words that could have been used in it's place and it seems like a bit of smart ass thing to say IMHO; almost as if the word's user was trying to make a point about how smart they were.
Hill Rat,
The cnn.com/
US/9902/
04/dc.word.
flap/">David Howard flap was a case of two Barry cronies looking for an excuse to try and steal his job. Howard was indeed an unrepentant smartass; he managed to clear a lot of deadwood in the administration. However, his use of the word makes him a dumbass, but I'm not sure that's grounds for getting fired. Indeed, it seems to be a requirement for some District career bureaucrats.
Point taken that we should all be aware of appropriate and correct use of language. This is why when I say "Shaw is really gay," I preface my statement by saying "Not in the good anal fisting way but in that horrible doubleparking-in-front-of-WholeFoods-in-a-Mini-convertible-blaring-ScissorSisters-with-a-miniature-doberman-in-a-knitted-afghan-sweater sort of way."
Hill Rat and Monkey:
I have to disagree with you about the niggardly episode.
Niggardly is a real word (just like macaca). And it's not totally unheard of. I'd heard of it before, and I'm not especially bright. If I recall it was mentioned in some sort of a budgeting/fiscal conversation, and as such it's not a totally unheard of word.
Was it unfortunate? Yes. But it is a word that is succinct, concise, and to the point. It's really, really stupid for us to expect our city officials to not use words because others are too ignorant to know what they mean.
Monkey - Whatever the real motivation for the niggardly gotcha, Howard dug his own grave with his intransigent use of the word.
Hillman - Oh, come now my good man! We are all painfully aware of how often it is necessary to deal with and accomodate the lowest common denominator, it's a sad fact of life.
You gotta know what time it is with this kind of shit, especially as a gay white man that works for DC's govt. That's like me going to NOW's yearly meeting and talking about how I "went upside that bitch's head", never mind that I was talking about a rabid female dog attacking my kid, that kind of talk just isn't gonna fly in that setting.