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Council Forges Deal on Stadium
Late Vote Reverses Initial Rejection, Adds Spending Cap

By David Nakamura
Washington Post Staff Writer
Wednesday, February 8, 2006

The D.C. Council voted to reject a baseball stadium lease agreement last night, then reconsidered four hours later and approved the deal after a plea from Mayor Anthony A. Williams and a threat from Major League Baseball President Robert A. DuPuy.

The dramatic about-face came at 12:40 this morning after the council added its own price cap to the lease, limiting the District's spending to $611 million for the project along the Anacostia River in Southeast Washington. With the cap in place, the council voted 9 to 4 for emergency legislation that approved the lease deal.

It was not clear whether baseball would endorse the spending cap, but Williams's aides said the mayor supported the council's final plan.

"The agreement we approved caps the city's investment . . . and protects the District from potential cost overruns," council Chairman Linda W. Cropp (D) said. "Major League Baseball did not get an open checkbook. . . . Now we will present this package to baseball and hope they agree it is a better deal for everybody."

DuPuy, who had threatened to take the city to binding arbitration after the council initially rejected the lease, reacted cautiously to the approval of the deal with the spending cap.

"I have no comment until we study this," he said. "The city has an obligation to build a stadium in conformity with the Basic Stadium Agreement."

Asked whether baseball officials would support the revised deal, Williams (D) said: "We're going to get them on board. . . . They should appreciate what Chairman Cropp has done. She improved the deal and got nine members in support of baseball."

There were stronger clues that baseball officials might endorse the deal. After the vote, Mark H. Tuohey, chairman of the D.C. Sports and Entertainment Commission, approached Cropp and told her: "Good job, you really pulled this through, and DuPuy says thank you."

About 8:40 p.m., after a day of negotiating, the council voted 8 to 5 to turn down the lease deal that had been negotiated between baseball officials and the Williams administration. The council had been unable to agree to a spending cap after determining that a cap offered by Williams did not fully protect the city.

Without a lease, the city would have been unable to issue bonds to build a stadium along the Anacostia River in Southeast, and baseball probably would have halted its plans to sell the Nationals to an ownership group.

Within half an hour of the council rejecting the lease, DuPuy issued a statement saying baseball would pursue arbitration and consider "all other options." Williams descended from his sixth-floor suite in the District building and urged the council members to move for a reconsideration of their vote.

"I beg and implore the council to reconsider the deal, even tonight," Williams told reporters. "I think we're in danger of losing baseball."

If baseball were to pursue arbitration, the process could take six months, result in large financial penalties for the District and even lead baseball officials to move the Nationals to Northern Virginia or another locale, Williams warned.

The council had resumed its legislative meeting, taking up unrelated issues. But mayoral aides, including City Administrator Robert C. Bobb, began huddling with members in conversations about how they could resurrect the deal.

"The defeat of the lease caused everyone who saw it go down to reconsider where we were," said Jack Evans (D-Ward 2), a staunch stadium supporter. "It was the catalyst for people to go back and to say, 'Maybe I should moderate my position.' "

A chief concern from some council members was that the first spending cap drafted by the council allowed the city to use funds from the sale of development rights on stadium land to cover cost overruns on the ballpark structure. Mayoral aides rewrote the spending cap to disallow such spending, limiting the flow of money from development rights to go only toward cost overruns related to the city's purchase of 14 acres for the project.

The council then voted to approve the spending cap of $611 million and voted to approve the stadium lease. The legislation allows an additional $20 million contribution Major League Baseball promised in December to go toward the project. All other costs must be covered by the Nationals' future ownership group, developers or federal sources, the legislation said.

In the first vote, the members who voted to support the deal were Cropp, Evans, Kathy Patterson (D-Ward 3), Vincent B. Orange Sr. (D-Ward 5) and Sharon Ambrose (D-Ward 6).

But on the second vote, when the council approved the lease with the spending cap, Marion Barry (D-Ward 8), Carol Schwartz (R-At Large), Kwame R. Brown (D-At Large) and Vincent C. Gray (D-Ward 7) also voted to support the deal.

Voting against the lease both times were David A. Catania (I-At Large), Phil Mendelson (D-At Large), Jim Graham (D-Ward 1) and Adrian M. Fenty (D-Ward 4).

"I hope everyone who voted for this gets a thank you note from baseball," Fenty said. "We are voting on a very unfair deal that every member of this council would say is a bad deal."

The council's action to approve the lease and spending cap ended weeks of intense negotiations, during which Williams tried to meet the council's demands that the city win new concessions from baseball and cap the District's financial input. Council members have expressed alarm over the city's liability for increasing project costs. Although the council approved a $535 million stadium financing package in December 2004, recent estimates from city financial officials put the cost at $667 million.

In late December, Williams asked Cropp to remove the stadium lease from council consideration a day before a scheduled vote because he lacked support. Since then, he has renegotiated with baseball officials and a mediator, former Detroit mayor Dennis W. Archer.

Williams also developed a ballpark cost cap with several construction companies and got commitments from developers to pay $70 million for land rights to help pay for stadium costs. But the council's consultant, DLA Piper Rudnick Gray Cary, said Monday that the mayor's cost cap did not protect the city fully from potential overruns.

Cropp vowed Monday to develop another cost cap that would win council approval for the lease. However, when she unveiled it yesterday at the council's closed-door breakfast meeting before the legislative session, Williams objected because the cap appeared to leave baseball responsible for cost overruns.

Staff writers Thomas Heath, Thomas Boswell, Lori Montgomery, Eric M. Weiss and Yolanda Woodlee contributed to this report.

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