January 19, 2005
Private benjamins
Washington, D.C.'s private stadium financing plans are in, with eight companies submitting proposals to get involved in building the $500-million-plus Nationals stadium - far fewer than expected, possibly because some folks were scared off by the nonrefundable $10,000 fee. The proposals revealed so far include some that are familiar, and others that are brand-new:
- BW Realty Advisors LLC is back with its leaseback plan that would put up private money for stadium construction in exchange for the depreciation rights to the building - a plan that, as Washington Post columnist Steven Pearlstein previously discussed, would actually cost more and subsidize a guaranteed profit for the developers, but would enable D.C. to shift some of its costs onto federal taxpayers instead.
- The Cleveland-based Gates Group submitted its parking-based plan to provide $100 million in exchange for a cut of parking-meter fees in the stadium district.
- Herbert Miller, a local developer, says he'll pay stadium construction costs in exchange for getting free land nearby, where he'd build a retail complex.
None of these proposals, you'll notice, involves private funding, just private financing: In every case, D.C. would just be selling off a public asset (land, parking revenues, depreciation rights) in exchange for some quick cash. The problem, as one unnamed city official told the Washington Times, is that D.C.'s deal with MLB rules out using any actual team revenues for stadium construction: "This is a very difficult piece of business. This contract with Major League Baseball doesn't leave much else on the table." If only somebody had noticed this before...
