D.C.'s Mayor Draws Fire on Stadium Plan

The city is funding the stadium through a gross receipts tax on local businesses, a utilities tax on businesses and federal buildings, a stadium concessions tax and the Nationals' annual rent payment. Mayoral aides told baseball officials that the city will collect about $20 million more in tax revenue over the next two years than is necessary to pay debts on the construction bonds.

Under the council's spending cap, all overruns must be paid by the Nationals' owner, the federal government or private sources. There is one exception. The legislation says, "District government non-General Fund funds may be used if required by the bond indenture to finance the Ballpark project."

That is the provision that mayoral aides said allows the excess tax money to be used to cover overruns. The administration has asked D.C. Attorney General Robert J. Spagnoletti to review the legislation and issue an opinion. A spokeswoman for Spagnoletti said yesterday that he has not completed his analysis.

The exception was added to the council's legislation to help the city persuade Wall Street bond raters to give the stadium project an investment-grade rating, city officials said. Bond raters want to be sure that if the stadium project exceeds the spending limit there is money to cover construction, said D.C. Chief Financial Officer Natwar M. Gandhi.

Council members said they agreed to leave that provision in the legislation to avoid complications on Wall Street. But they added that the intent of the spending cap was to force the mayor to find other entities, such as MLB, to pay for costs above $611 million. Excess tax revenue could then be used to pay off the bond debt early, freeing revenue for other city needs, members said.

"It had nothing to do with paying cost overruns," Brown said.

Barbara Lang, president of the D.C. Chamber of Commerce, said business owners would prefer that excess tax revenue be used to pay off the debt so that the tax can be lifted earlier than anticipated.

It is not clear what council members could do to stop the deal if Spagnoletti rules that the money can be used for overruns, and MLB endorses the spending cap by Monday. Barry suggested that the council could introduce an emergency disapproval resolution of the stadium lease at its legislative meeting Tuesday. Such a measure would need the support of nine of the council's 13 members for passage.

"People feel betrayed on both sides," Williams said of the council and MLB. "There's bad faith on both sides. And I think the only thing everybody agrees on is they don't like me."