The D.C. Council will be asked to approve three amendments to the baseball stadium financing package to satisfy Wall Street bond raters that there will be enough tax money to pay off bonds issued for construction:
* Gross receipts tax reduction: Under Mayor Anthony A. Williams's original financing plan, the city's larger businesses were expected to pay $26 million a year in gross receipts taxes. The council moved to reduce that last fall by using a utilities tax to pay for about $12 million. The final legislation mistakenly included the original $26 million, so the council will vote on changing the gross receipts tax to $14 million a year.
* Utilities tax: Wall Street wants a guarantee in the legislation that the utilities tax will bring in at least $12 million a year, enough to help cover the ballpark debt service. Bond raters fear that the utilities tax could bring in less money if, say, telephones become obsolete because of other means of communication.
* Tax-increment financing districts: The council created two "TIF districts" around the proposed ballpark to impose a special tax on businesses that will move into the area. One TIF district is within the 21 acres of the stadium site, and money from that district was to be used to help build the stadium. The second TIF district, on land just beyond the stadium's 21 acres, was created to help pay for a community benefits fund for schools and other programs. The final legislation mistakenly pledged the money from the first TIF district to both stadium construction and the community package. The council will be asked to correct that.
SOURCE: Staff reporting