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Nader to DC Council: Reject stadium lease, sign pledge to District residents promising ironclad cost cap
March 7, 2006
The Honorable Linda W. Cropp
Dear Ms. Cropp:
Major League Baseball has reportedly altered the stadium lease, effectively eliminating the stadium cap on city spending for the “hard and soft costs” of construction. Though the Council unforgivably approved the one-sided lease last month, it did so with the intent of limiting the city’s cost for the project, and with the intent -- as I was told by District CFO Natwar Gandhi -- that Major League Baseball, Mayor Williams and the DC Sports and Entertainment Commission sign the lease by March 6, 2006, “without any reservation.” Therefore, the DC Council has no choice but to reject the altered stadium lease that again leaves the District ultimately responsible for all cost overruns.
Now, in addition to the costs for land acquisition and environmental remediation which were left open-ended by the DC Council at the February 7, 2006 legislative meeting, Mayor Williams has again worked against District residents and the DC Council, and on behalf of Major League Baseball to eliminate the cap on the “hard and soft costs” for constructing the stadium.
Contrary to the Council’s intent that excess revenue money be deposited into the “Community Benefit Fund,” the Mayor is insisting that this money be used instead to cover cost overruns to protect Major League Baseball from any risk associated with their $610.8 million taxpayer gift. Consequently, according to the March 6, 2006 Washington Post, Major League Baseball has signed the lease under a condition calling for “excess ballpark tax revenue earmarked for debt service for the bonds to be available for cost overruns.” This provision would render the spending cap meaningless and would be a blank check to use stadium taxes to pay for any future costs.
Another condition of Major League Baseball’s approval of the lease, as reported in the Post, is that “it does not become legally binding if the city enacts further legislation that is contrary to the stadium funding plan that the council passed.” This arrogant bullying of the DC Council is intended to dissuade council members from rallying to pass a permanent version of last month’s lease legislation that clarifies the intent and plugs the loopholes to the city spending cap.
The DC Council -- especially those members who switched positions under the cover of a spending cap -- must reject the stadium lease. As Councilmember Barry told the Washington Post last week, after Mayor Williams’ insisted that excess revenues be used to cover overruns, “If there’s one thing I said to the mayor, it’s that I didn’t want any shenanigans, no side deals like this. If he does this, this stadium is dead again. . . . We wanted a cap that was tight. Everyone was confident, so we went with it. If it’s not tight, there will be rebellion.”
When Mayor Williams began offering public money to pay for a stadium for Major League Baseball, the price tag was $200 million. Then, it was $275 million, then $300 million (December, 2002), then $339 million (June, 2003), then $383 million (July, 2004), then $440 million (September, 2004), then $535 million (December, 2004), then $589 million (November, 2005). The DC Council’s approval of the lease at the February 7, 2006 legislative meeting increased the public subsidy to a whopping $611 million of the $631 million stadium project cost. One of the councilmembers who eventually switched his vote on the lease admitted to me that he thought the cost, in today’s dollars, could reach $1 billion for the stadium project.
As the cost of the stadium has swelled for DC taxpayers, so too has Major League Baseball’s asking price for the team. Major League Baseball originally acquired the team for $120 million. When Major League Baseball put their relocation extortion into high gear in 2003, it was estimated they could sell the team for $250 million. In September, 2004 when Baseball announced that the team would relocate to the District, estimates rose to $300 million for the sale. Today, Baseball stands ready to command $450 million for the Nationals.
To approve the lease, would be to approve the stadium at all cost and all risk. Do not allow Major League Baseball to continue to run roughshod over the District of Columbia.
In addition, please see the attached pledge. I look forward to your response.
Sincerely,
Ralph Nader
cc:
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DC Council Stadium Cap Pledge to the People of the District of Columbia
The residents and taxpayers of the District of Columbia have been told by members of the DC Council that the baseball stadium lease contains a $610.8 million cap on spending from city resources for the new stadium project. This is a request made to each council member to either sign the following pledge that promises a true ironclad cap, or to explain the reason(s) why you decline the pledge.
I, _________________________ of the DC Council, hereby pledge that -- should a new baseball stadium be constructed -- not one dollar more than $610.8 million will be spent on the total stadium project using District of Columbia public resources of any kind, including from tax dollars, tax breaks, development rights, bond revenue, private monies provided in exchange for something of value from the District or any other resource connected to the District, including those from the Anacostia Waterfront Corporation, the DC Sports and Entertainment Commission or any other quasi-governmental entity of the District.
I promise to the people of the District of Columbia that the $610.8 million cap on city spending for the new baseball stadium is a true, ironclad cap, with no loopholes.
Signed,
_________________________Date:__________
- - - - - - - - - - - - - - - - - - - - OR - - - - - - - - - - - - - - - - - - - -
(please explain the reasons for refusing the above pledge)
I, _________________________ of the DC Council, decline to pledge that -- should a new baseball stadium be constructed -- not one dollar more than $610.8 million will be spent on the stadium project using District of Columbia public resources of any kind, for the following reason(s):
Signed,
_________________________Date:__________ |