Advisory, May 20, 1998
For more information, (202) 789-7864
Deal reached on convention center
guaranteed maximum price?
Authorities claim price will be fixed
But new study predicts escalation in Mt Vernon convention center costs
Union Station offers better and cheaper alternative
Inside sources say an agreement for a
guaranteed maximum price of $650 million for the Mt. Vernon proposal for a new
convention center may have been reached. But a new study says the proposed convention
center at Mt. Vernon Square cannot be built for $650 million as officials have stated and
will actually cost taxpayers about $900 million, excluding bond interest.
Sources said a preliminary agreement was
reached between Clark Construction and the Washington Convention Center Authority to build
the Mt. Vernon convention center for $650 million. Many members of the D.C. council said
they would not support the Mt. Vernon plan if its price exceeded that figure.
But a new financial study prepared by the
prestigious Committee of 100 on the Federal City says the Mt. Vernon convention center
would actually cost almost $900 million.
The study will be released Thursday, May
21 at 11 am at the Sumner School, 17th and M Sts. NW, Ground Floor.
The release of the guaranteed
maximum price agreement and the new study raises questions as to how much the Mt.
Vernon center would actually cost. The Mt. Vernon proposal has come under heavy fire as
costs have escalated from $450 million to $737 million before one shovel is in the ground.
Critics have charged that a guaranteed maximum price may include loopholes
that could cost the city millions of dollars once construction begins.
The new Committee of 100 study, prepared
with the help of nationally recognized financial and construction cost consultants, makes
the case that a convention center at Union Station could save the city an immediate $227
million and be open for business as soon as the proposed Mt. Vernon version.
The D.C. Council has planned a hearing on
convention center finances May 29. The Control Board and Congress must also approve any
convention center financing plan.
For more information, contact Beth Solomon
at (202) 789-7864.