Under the legislation, companies with annual revenue of at least $4 million would have to pay the gross-receipts tax, with larger companies paying progressively more. Officials said the tax is expected to bring in $26 million annually, of which $24 million would be used to pay debt service on the stadium bonds.
The city would use $2 million a year to help set up the community investment fund. After the stadium is completed, about 2008, the fund would receive up to $450 million from bonds to be financed by establishing a "tax-increment financing district" around the stadium. A portion of taxes from businesses in the financing district would be dedicated to paying debt service on the bonds.
Jack Evans (D-Ward 2) used an expletive during a heated exchange with another council member.
(The Washington Post)
Some business leaders object to the use of gross-receipts tax money for the community investment fund. Any extra money from the tax should be used to pay off the stadium bonds early, they said.
The stadium financing legislation "was presented last month to the city's business leaders as a dedicated tax specific to the construction of a new ballpark," said Len Foxwell, director of government relations for the Greater Washington Board of Trade. "We feel very strongly that the mayor and the council should abide by the terms of that commitment."
Gregory McCarthy, legislative affairs chief for Mayor Anthony A. Williams (D), said the city will try to reach a consensus with the business community by Tuesday.
"We need to tell the business community that the whole thing, over 30 years, will gain a lot more broad-based support if we have the community benefits along with the stadium," McCarthy said.
Martin Trimble, an organizer for the Washington Interfaith Network, said his group is concerned that the community investment package is not sufficiently structured to produce enough revenue.
"We need a dedicated stream of money," he said. "We're prepared to make a major issue of it if we have to."