By David Nakamura
Washington Post Staff Writer
Thursday, October 5, 2006
Six months after the D.C. Council voted to cap the rising costs of the Washington Nationals baseball stadium at $611 million, Mayor Anthony A. Williams now says the city needs an additional $75 million in public funds to finish the job.
The extra money, which would require approval from the council, would be used to help pay for parking garages on city land just north of the ballpark, near South Capitol Street and the Navy Yard in Southeast Washington.
Mayoral aides said they are working with Council Chairman Linda W. Cropp (D) and Marion Barry (D-Ward 8) on a legislative bill that would ask the council to alter the spending cap. But several other members objected vehemently yesterday when informed of the plan by a reporter.
Although the council included $25 million for parking in the initial budget, Williams (D) and his top aides say that is not enough to build the garages in a way that would allow for additional development on the site, such as condominiums, shops and restaurants. The mayor has promised that the ballpark project would spur new business and produce millions of dollars in tax revenue.
Under the proposal being developed by Williams, the D.C. Sports and Entertainment Commission and some council members, the council would be asked at its Oct. 18 meeting to alter the cap and allow additional public money to pay for stadium parking.
"All the council members agree that we need to maximize the economic benefits of the stadium," mayoral spokesman Vince Morris said yesterday. "If we do not do this, we lose out. . . . To not do it would be irresponsible."
When Williams announced that the District would be getting a Major League Baseball team in September 2004, he said the stadium and parking would cost $435 million. But the cost estimates were quickly raised -- to $535 million in December 2004, then to the $611 million limit set by the council in April.
David A. Catania (I-At Large), who voted against the stadium, said city leaders misled residents when the initial budgets were set.
"This is just the beginning of what will be a project that is far more expensive than promised," Catania said. "They are a minimum of $100 million over budget in the first six months" since the council approved financing for the stadium.
Jack Evans (D-Ward 2), an ardent stadium booster, said he did not think the council would approve any proposal to alter the cap and allow more public spending.
"There is no legislative remedy for the parking," Evans said. "Under no scenario will the council raise the cap, in my view."
A spokesman for Adrian M. Fenty (D-Ward 4), the Democratic mayoral nominee, said Fenty had not been briefed and was not prepared to comment. The issue is on the agenda for the mayor's regular breakfast with the council this morning.
The cost of parking garages is only one part of the stadium budget that has been strained since workers broke ground in May.
According to documents provided by the sports commission, the city has allocated $17 million more in spending than anticipated, mostly to remediate environmental contamination at the site and to change the designs of retail shops outside the stadium.
Sports Commission Chief Executive Allen Y. Lew said yesterday that those changes did not affect the cost cap because the city spent $17 million less than expected in financing fees for stadium bonds on Wall Street.
But as workers prepare to install a major purchase of steel for the ballpark frame next week -- a key step in the construction process -- the project's budget appears to have run out of wiggle room, 1 1/2 years before the scheduled completion in April 2008.
Sports Commission Chairman Mark H. Tuohey said the commission was not in danger of exceeding the stadium budget. He said the council's cost cap legislation allowed for overruns for cleaning up environmental problems because no one knew for sure how contaminated the soil was at the site, once an industrial area.
Tuohey added that the cleanup, which has cost $15 million, about $7 million more than the budget authorized, is nearly complete.
"From the people I talk to, the worst is over," Tuohey said.
The question of how to build parking garages at the stadium has vexed city officials all summer. Under the stadium agreement, the city is required to provide 1,225 parking spaces to the Washington Nationals on the 20-acre site.
The Nationals' ownership group, headed by Bethesda developer Theodore N. Lerner, has lobbied the city to build two free-standing garages on the north parcel to house 925 vehicles, with a garage on the south side for the remaining 300.
But Williams and his aides have pushed for a more ambitious mix of underground and aboveground parking, along with condominiums, shops and restaurants -- the center of a larger entertainment district that would lure fans and new residents, as well as generate additional tax dollars for the city.
This summer, the city struck an agreement with developer Herbert S. Miller to build two 13-story condo towers, along with parking garages. The deal was approved by the council and the D.C. Zoning Commission, but it collapsed recently when Miller and the sports commission could not agree on financing terms.
Among other plans the city is considering for parking is paving over the five acres and providing temporary surface-level spaces, officials have said. Under that scenario, the city would try to build garages and additional development after the stadium opens.
Under the new proposal, the sports commission would build two levels of parking underground and one level aboveground on the north parcel and another garage on the south side at a cost of $100 million.
Those garages would be engineered so that further development could be added in the future, officials said.
Since the city has $25 million for parking in the current budget, it would need an additional $75 million. Of that, $17 million would come from excess from a special tax on businesses and utilities that the city has collected during the two seasons the Nationals have played at Robert F. Kennedy Memorial Stadium.
The remaining $58 million would come from either a private developer, who would pay the city for the right to build above the garages, or from publicly financed bonds, city financial officials said. Either option is considered public funding and is barred by the council's cost cap.
D.C. Chief Financial Officer Natwar M. Gandhi is reviewing the financing options, his office said yesterday. A spokesman for the Lerner group said only that discussions are continuing between the owners and the city.
Mayoral spokesman Morris said building parking underground is critical because that is the concept the Zoning Commission approved under Miller's plan. Furthermore, he said, building mixed-use development at the site would be far better for the city than having only parking garages.
"The more valuable the property is, the more District residents will benefit," he said.
Staff writer Thomas Heath contributed to this report.