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Nationals Withhold Rent on Ballpark

The family of Theodore N. Lerner spent more than $450 million to buy the franchise. There have been many disputes between the team and the city.
The family of Theodore N. Lerner spent more than $450 million to buy the franchise. There have been many disputes between the team and the city. (By John Mcdonnell -- The Washington Post)
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A "punch list" of hundreds of items remains incomplete, according to team officials. More than 100 construction workers are still at the stadium during off-days, a source close to the Lerners said.

That source stressed that the overriding issue for the family is living up to terms of the contract between the city and Major League Baseball, which the Lerners inherited upon buying the team in 2006. The source spoke on condition of anonymity because negotiations are continuing.

"In the mind of the city, there's an attitude that, 'Hey, you got a free stadium. Cut us a break,' " the source said. "But if you read the letter of the agreement, this is not subjective thinking. . . . This has nothing to do with the Lerners trying to take advantage of ambiguous language."

In addition to the rent dispute, the Nationals and the D.C. government are fighting over the timing of payments on several million dollars in taxes from ticket sales, according to other sources familiar with the conflict. They, too, spoke on the condition of anonymity because of the sensitivity of the issue.

Instead of turning over the tax money as soon as the bulk of full- and partial-season ticket packages were sold last winter and spring, the Lerners are making payments on a game-by-game basis, the sources said.

The District is counting on the rent and sales tax, along with a special tax on city businesses, to help pay off construction bonds for the ballpark. Last week, the city's Office of Tax and Revenue sent a letter to the Nationals demanding the money, the sources said. District finance officials declined to provide The Washington Post a copy of the letter, citing privacy laws governing individual tax payers.

D.C. Mayor Adrian M. Fenty (D), who as a council member voted against the stadium package, declined to comment, according to a spokeswoman. Acting Attorney General Peter J. Nickles said he is confident that the city will win a legal fight.

"We feel the stadium is substantially complete and that we'll be able to work it out," Nickles said.

The escalating dispute is drawing the ire of stadium critics.

"Now everyone has buyer's remorse and can't believe this was such a bad deal. But many of these bells were rung," said D.C. Council member David A. Catania (I-At Large). "This whole process has happened because it was so hastily put together and because the city has not bothered to look out for its long-term interest, and there is going to be one issue after another for years to come."

The Nationals owners have already been through a round of arbitration over ballpark costs, including over a demand that the city pay for the team's uniforms. The arbitrator ruled in the city's favor, but since then some city officials have privately expressed increasing frustration over the family's stands.

The Lerners were selected by Major League Baseball to purchase the Nationals; the city had supported a different potential buyer. The family has earned the bulk of their development fortune in the suburbs, with such projects as Tysons Corner.

"The owners of the team are very strong business people, and they take a very businesslike approach to the whole relationship. They enforce their rights to the extent they can," said council member Jack Evans (D-Ward 2), an ardent baseball booster.

"The city needs to behave accordingly and enforce our rights within the contract. And then if that's done, the relationship should be fine, as long as everyone complies with the documents."

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