A July 15 article about subsidies for three major projects in the District misspelled the name of D.C. Council member David A. Catania R-At Large). (Published 7/16/04)

The D.C. Council has approved spending $107 million to help launch major projects in three different parts of the District.

The money will be lent to each project using a mechanism known as tax increment financing, which allows the developers to use tax revenue generated as a result of the project to repay the debt.

The three projects are an addition to the Corcoran Gallery of Art, designed by architect Frank Gehry; a large retail complex in Columbia Heights, to be anchored by a Target store; and a redeveloped Skyland shopping center in Southeast Washington that has also drawn interest from Target Corp.

While the two shopping centers are projected to produce significant new property and sales taxes on their own, studies of the Corcoran project suggest that any major tax revenue increase from the Gehry addition probably would come from hotel and restaurant taxes paid by out-of-towners who come to visit the building.

D.C. Council member Jack Evans (D-Ward 2) argued that the architecturally stunning Gehry addition -- projected for completion by 2009 -- will be such a draw for the city that the $40 million subsidy is worthwhile. City economic development officials agreed. The measure passed the council 9 to 2, with Adrian M. Fenty (D-Ward 4) and Carol Schwartz (R-At Large) dissenting. Vincent B. Orange Sr. (D-Ward 5) was absent and Kevin P. Chavous (D-Ward 7) left before the vote on Tuesday.

"It's not the retail from the building, it's retail around the building" that will generate revenue to repay the loan, Fenty said yesterday. "I think that becomes too speculative," he added. He said he would prefer to use tax increment financing for more struggling areas. "This program was designed to turn around blighted neighborhoods, not to add multimillion-dollar wings to multimillion-dollar buildings downtown," he said.

The Columbia Heights project, called DC USA, will receive a $42 million subsidy that will help pay for an underground parking lot. That measure passed 10 to 1, with David A. Cantania (R-At Large) voting against it.

The funds will allow the developers to secure other financing, officials said, to finalize purchase of the property by year's end. The retail complex, first announced in 1999, would be among the largest in the city. It is slated to open in early 2007.

The $25 million Skyland subsidy will help city officials acquire land at the existing shopping center, which is fully leased but includes few large stores and a lot of vacant land. The city has chosen a developer to create a larger complex with more upscale shopping options and possibly a sit-down restaurant. It is scheduled to open in 2008.

The project, in Ward 7, is being championed by Chavous, who joined in the unanimous 12 to 0 vote for the subsidy. But the existing Skyland property and business owners, and a few nearby residents, oppose the redevelopment plan. Several of them sued this week in U.S. District Court to try to stop it.