Wizards Owner's $50 Million Request Gets Initial Approval

By Nikita Stewart
Washington Post Staff Writer
Wednesday, April 4, 2007

The D.C. Council gave initial approval yesterday to a request from Washington Wizards owner Abe Pollin for $50 million to upgrade the Verizon Center.

In a 9 to 2 vote, the council favored borrowing the funds so that Pollin and his company can purchase a $5 million scoreboard and make other improvements to the nearly 10-year-old arena. The city plans to raise the tax on tickets and merchandise at the downtown arena to repay bonds issued for the project. The council must take a second, final vote on the request.

Under legislation that Pollin sought in January, the tax rate on tickets at the 20,674-seat arena would increase from 5.75 percent to 10 percent -- the same percentage for tickets and merchandise at Washington Nationals baseball games.

Council member Jack Evans (D-Ward 2), who co-sponsored the legislation, said the levy would be a "user tax" that would mostly burden nonresidents of the District.

About 60 percent of patrons at the Verizon Center are from Maryland and Virginia.

Council members expressed consternation about their affirmative votes but said they were willing to invest in the Verizon Center, which will belong to the city by 2047. They also said they admired Pollin's decision to use $220 million in private financing to build the arena, which is credited with rejuvenating the Chinatown area.

"For me, this is a business decision," said Chairman Vincent C. Gray (D).

Gray said the upgrades, which include a $3 million renovation of luxury suites, will help attract "top-drawer, first-class, top-level events" to the arena that could generate millions in tourist dollars. With an event such as an NCAA Final Four, "we could recoup those dollars in one weekend," he said of the $50 million.

But council member Tommy Wells (D-Ward 6), who dissented, said such borrowing should be used for neighborhood projects and worried that the council was giving Pollin $50 million because the city is pumping $611 million in public funds into a new baseball stadium complex.

Council member Mary Cheh (D-Ward 3) said she did not see proof that Pollin could not pay for the improvements himself and said the council may be setting a precedent for other businesses to request public funds for private endeavors.

Representatives for Pollin have said that he would have difficulty paying for upgrades because he owes $110 million on money borrowed to build the arena.

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