District leaders may reduce the public investment in a new baseball stadium by accepting a $246 million payment from Deutsche Bank and granting development rights at the site to a private firm.
The plan, which is not finalized, would use aspects of two proposals that have been made to the city by private entities. The D.C. Council has been seeking ways to find private funding for the stadium project, which has been estimated to cost up to $581 million.
Robert Siegel, who owns land at the proposed stadium site, including this property on O Street SE, has filed a lawsuit to block the city from acquiring it.
(Marvin Joseph -- The Washington Post)
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Yesterday Natwar M. Gandhi, the city's chief financial officer, recommended that the D.C. Council adopt a plan that combines pieces of a previous proposal from Deutsche Bank with the city's public financing plan.
In exchange for a $246 million payment from Deutsche, the city would give the international banking giant a revenue stream estimated to reach $18 million per year in taxes from ballpark concessions and parking.
The plan would limit the District's debt by reducing the city's need to issue bonds from about $550 million to $313 million, Gandhi said. Also, the gross receipts tax on city businesses that would be used to help pay for the stadium would be reduced after 10 years from $14 million per year to $8 million, Gandhi said.
D.C. Council Chairman Linda W. Cropp (D-At Large) and member Jack Evans (D-Ward 2) said they like aspects of the Deutsche Bank plan. But they said they also are considering a new proposal from developer Herbert S. Miller.
Miller had previously proposed to pay for the stadium if the city gave him rights to develop other land outside the ballpark site along the Anacostia waterfront in Southeast. That idea was rejected by Gandhi, who said it would increase the cost of the stadium and be difficult because the city would have to acquire more land for Miller.
Recently, Miller revised his proposal, saying he will pay more than $200 million if the city grants his firm the right to develop 1 million square feet at the stadium site, which at 20 acres is big enough for a ballpark and other development such as a parking lot, office buildings, a conference center and restaurants, according to city officials.
The city could decide to combine the Deutsche Bank plan and Miller's proposal, Cropp and Evans said.
"All of it is intriguing," Evans said. "And it clearly satisfies the private financing concept."
The council, which was sharply divided, narrowly approved a stadium financing package in December with the stipulation that the city secure at least $140 million in private money.
Eight companies submitted private financing plans to Gandhi, but he certified only two: the one from Deutsche Bank and one from the Cleveland-based Gates Group that relied on revenue from parking near the stadium. Council members have objected to the parking idea.
Gandhi said yesterday that the Deutsche Bank plan would help limit the city's risk because the bank has agreed to give the city an upfront payment in exchange for a revenue stream that is unreliable and would be difficult to sell on the bond market.
Some city officials said they need to know more about the Miller plan before endorsing it.
