March 15, 2005

Private benjamins, cont'd

For all those of you wondering what was up with those private-financing plans for the Washington Nationals stadium - hello? anyone? is this thing on? - D.C. CFO Natwar Gandhi has issued his verdict, approving two of the plans submitted earlier this year.

The winners: A proposal by Deutsche Bank to buy the city's future stadium-tax proceeds for a lump sum of $493 million; and the previously discussed offer by Cleveland's Gates Group to buy future stadium-district parking meter revenue, for $100 million. Neither of these, you'll note, provide private funds for the stadium; rather, they're both ways of (economic jargon warning!) capitalizing future revenue streams, which may or may not be good public policy (the city reduces its risk if revenues fall short, but misses out on the windfall if they're better than anticipated), but still mean the public is paying the same 80% share of the $500-million-plus stadium.

Meanwhile, the six other proposals, including the stadium-for-land swap pitched by developer Herb Miller that the Washington Post touted last week as "creating the most buzz in the D.C. government," got the heave-ho from Gandhi, who determined that they would have actually increased the city's bonding costs.

It's now up to the city council to pick one or both of the plans certified by Gandhi. "This should satisfy enough people so we can move on," one unnamed city government official told the Post - but you know what he really wanted to say.