D.C. officials are still holding out hope they can keep the Washington Wizards and Capitals in downtown D.C., despite the announcement of a deal that would move both teams to Virginia.

The deal, which Monumental Sports and Entertainment and Virginia officials jubilantly announced early Wednesday, would move the Washington Wizards and Capitals from Capital One Arena in Chinatown to a massive new 70-acre campus and complex to be built in Alexandria’s Potomac Yard.

Monumental owner Ted Leonsis framed the project — a $2 billion public-private partnership — as pretty much a done deal. But D.C. officials and lawmakers say Virginia’s deal is far from final and could fall apart — and they are keeping a deal of their own on the table just in case. If their efforts fail, the city faces losing not only two sports teams but also an economic engine of downtown D.C. — which experts say creates jobs, supports businesses, and funds much-needed social services in the District.

At a press conference Wednesday, D.C. Mayor Muriel Bowser acknowledged that the momentum appeared to be moving the teams to Virginia. Still, she said, “it’s not done.” Bowser told reporters that she’s “not sure what the Virginia process is, but we expect that it will hit some snags.”

D.C. Council Chairman Phil Mendelson echoed the mayor’s skepticism in an interview with DCist/WAMU.

“I don’t want to say anything negative about Virginia, but it ain’t over until the fat lady sings,” Mendelson said. “We continue to show to Monumental that we’re serious and that we want them to stay.”

Tuesday evening, after initial news of the Virginia deal first became public, Bowser and Mendelson unveiled legislation — with unanimous support from the D.C. Council — offering the sports and media company a $500 million deal to renovate the arena. (D.C. officials said Wednesday they had secured additional borrowing authority to fund the deal.)

The bill, Bowser said in a press release late Tuesday, represents the city’s “best and final offer” to keep the teams. The legislation — which put on paper the deal the city offered the team on Sunday, according to Bowser — is an attempt to fulfill Leonsis’s ask, first reported by the Washington Post last month, for $600 million from the city to renovate the venue.

Ward 2 Councilmember Brooke Pinto, who represents the neighborhood around the arena, and others in the D.C. government have been negotiating with Monumental for months about a deal for financing arena renovations, she said Wednesday.

“I have been taking this threat seriously for months, if not years,” she told DCist/WAMU.

What could work in D.C.’s favor — and what doesn’t

One sticking point, D.C. officials said, is the availability of land in Virginia, which D.C. just couldn’t match.

“An example of the apples and oranges is 70 acres, versus downtown with all of its pluses and minuses,” Mendelson said, adding his negotiations with Monumental mostly focused on how it could grow its footprint in the city.

But some proponents of the Virginia deal also frame the teams’ move to Virginia as a decision motivated by rising crime in the District.

“As D.C. politicians pretend they don’t have a public safety issue… and carjackings, violent crime, and robberies worsen, Virginia residents are less likely to spend their time (and their money) in the District,” tweeted Virginia Attorney General Jason Miyares. “We welcome the [Capitals], [Wizards], Monumental Sports & Entertainment, and this tremendous development to a safer Virginia.”

But while rising crime is a serious problem for Chinatown and other D.C. neighborhoods, Monumental has “repeatedly reiterated” that the potential move to Virginia “is much more about the 70-acre campus that Virginia is offering,” Pinto said.

Mendelson and Pinto said they’re still holding out hope that D.C. can keep the teams. They noted that the final deal in Virginia will still require approval by the Virginia General Assembly and the Alexandria City Council.

“It is an unsure thing. Virginia has a Republican governor, a Democratic General Assembly. There are next steps to this process,” Pinto said.

Despite the fact that the entire Alexandria City Council and a number of other Virginia officials and lawmakers from both sides of the political aisle showed a united front with Leonsis at Wednesday’s press conference announcing the deal, D.C. officials expressed skepticism. Mendelson, for one, questioned how Virginia will fund the massive project, plus the infrastructure to support a new stadium, specifically Metro, which has its own funding issues.

“Metro needs to operate in order for Monumental to work,” Mendelson says. “So he may be giving the Northern Virginians a choice here, ‘Do you want a team with no subway system or do you want a subway system?’”

D.C.’s deal is a surer thing because there are fewer governmental hurdles to clear, argued D.C. officials.

“It is a very strong offer. It is also a sure offer,” Pinto said.

D.C.’s own deal still has to go through a legislative process, which will proceed despite Wednesday’s announcement, the council chair said. It won’t be emergency legislation, bypassing hearings, Mendelson said. He declined to say how soon a hearing would be scheduled because he wanted to coordinate with the mayor and her team.

Bowser hopes the council could pass the legislation by February, which would make the dollars available to the team as early as spring 2024, she said Wednesday. She even floated the possibility of D.C. going further and making additional land available to Monumental, perhaps at the former RFK Stadium site or downtown where the FBI is expected to vacate its headquarters.

Some D.C. lawmakers criticized the Bowser administration for not acting sooner. “Today’s move wasn’t inevitable, but avoiding it required far more focus in the past year than it ever received from the Administration,” said Ward 6 Councilmember Charles Allen in a statement on Wednesday. He said District leaders were too distracted with trying to build an NFL stadium and now need to more aggressively focus on transforming downtown, with or without the Wizards and Capitals.

The teams’ move to Virginia would not mean the Capital One arena would close altogether, Monumental says. Instead, the current plan is to renovate the arena into a smaller venue that would continue to host concerts, shows, college basketball games, and more. Plus, Monumental said it would bring the WNBA’s Washington Mystics back downtown – much to the chagrin of some Ward 8 residents who saw the team as a boon for Congress Heights.

Arena has been downtown’s economic ‘engine’

Still, experts say that moving the Wizards and Capitals out of the city could prove devastating to the city’s economy.

It was Capital One Arena — formerly known as the MCI Center and then Verizon Center — that revitalized the Chinatown neighborhood and contributed to the general improvement of the city’s economy when it opened downtown in 1997, according to Yesim Sayin of the D.C. Policy Center.

Sayin, an economist who focuses on the District, said the arena was the “main engine of recovery for D.C. back in the ‘90s.”

“It really changed the trajectory of not just Chinatown but was the creator of Penn Quarter and all the neighborhoods around,” Sayin said. “Moving such an anchor is devastating for the city.”

The importance of that “anchor,” D.C. officials said, motivated their choice to make $500 million available to Monumental Sports, despite the fact that the city and region has other gaping financial needs — like Metro’s dire financial situation and soaring housing and food insecurity.

Bowser said the $500 million can’t simply go to other priorities because it’s part of the capital budget, not the operating budget. And as for other capital projects, Mendelson noted some are already hitting capacity, citing public housing projects that have more money than they can spend.

Pinto argues keeping the arena in D.C. would guarantee that the city would have money to spend on its transit system, human services, and public safety needs.

“When we have over 200 events a year, that helps funnel riders into our transit system, which helps stabilize our transportation budget … The arena also generates hundreds of millions of tax dollars every year,” Pinto said. “So the calculation is slightly different.”

Sayin, with the D.C. Policy Center, said the arena has created a “vibrant local service economy” and a revenue engine that powers other city services. Without that engine, she said, “you’re not going to be able to pay for SNAP or schools and all other social services and supports.”

What’s next for downtown?

It’s unclear what happens to Downtown D.C. without the Wizards or Capitals. Bowser has tapped two business leaders, Jodie McLean, CEO of EDENS (owner of much of the Union Market district and a large portfolio of other properties in the region), and Deborah Ratner Salzberg, former president of Forest City Enterprises and former chair of the Federal City Council, to lead a task force that would strategize the future the area near the Gallery Place/Chinatown Metro station. McLean and Ratner helped lead the transformations of the Union Market and Yards Park neighborhoods, respectively. Bowser expressed confidence in their ability to re-make neighborhoods.

Sayin said while the news has her extremely worried, she hopes the city has time to think about what to do to revive downtown’s economy. The teams won’t leave the arena until 2028, according to the plan Monumental announced.

“We have four years to think through — what are some of the investments we can make in these areas to bring back economic vibrancy?” Sayin said.

But as the city keeps making its case to keep the teams, Bowser is also banking on fans’ devotion to an arena at the center of town. She framed Monumental’s next step as a choice between an urban arena experience and a suburban one.

“People love real cities. They are hubs of history and culture and energy,” Bowser said. And, she added, Washington, D.C. teams should stay in Washington, D.C.

“National Landing Wizards doesn’t quite have the same ring,” she said.

This post has been updated to include comment from Monica Dixon, the president of external affairs at Monumental Sports & Entertainment, and Charles Allen, the Ward 6 councilmember.