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Councilmember Harold Brazil
Opening Statement
Committee on Economic Development and Committee on Finance and Revenue Joint Hearing on the “Ballpark Omnibus Financing and Revenue Act of 2004,” Bill 15-1028
October 28, 2004




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Opening Statement of Councilmember Harold Brazil
Thursday, October 28, 2004

Joint Hearing of the Committees on Economic Development and Finance and Revenue on Bill 15-1028, `Ballpark Omnibus Financing and Revenue Act of 2004 "

As Co-chair of today's hearing, I am thrilled that after many years of hard work on the part of the Council, the Mayor, and the Sports Commission, Major League Baseball has decided to return to the Nation's Capital! I began pitching for the return of major league baseball to Washington, even before I ran for Council-back when former City Councilman Frank Smith was the head of the Baseball Commission. Back then, as now, we were a teambusiness, the government, the fan club and residents all working together to bring baseball back. We even sold season tickets for a team we did not have, to impress MLB, and let them know that we were serious about baseball in Washington.

There has been an immense outpouring of emotional support for baseball's return.

People have stopped me on the street and expressed their excitement as well as appreciation.

You can see the civic pride that baseball will generate, and has already brought to our residents.

And I am even more excited because Major League Baseball's return is not only a great civic investment, it is also a strong economic investment.

By placing the new ballpark in an underdeveloped area near the waterfront, Washington can follow on the success of cities like Denver, Baltimore and Cleveland. These stadiums have been catalysts for development, and these and other cities have generated millions of dollars in revenue for the government and private industry and thousands of jobs for their residents. Their stadiums have become civic landmarks and a source of pride and prestige.

Bringing baseball back to the District will create thousands of jobs for our residents and pump millions of dollars into our restaurants, stores, and neighborhoods. A 1999 study conducted for the District estimated that there would be over $1.4 billion in direct spending and over $2 billion in total spending generated by a stadium in its first 20 years. In addition, the study showed that over 2,000 jobs would be created and over $750 million in salaries generated - jobs and money for District residents.

These are conservative estimates. A more recent study conducted for Virginia estimated that a new baseball stadium would create over 3,000 jobs and have a 30-year economic impact of over $8.5 billion dollars and generate salaries of almost $3 billion.

Other cities that have done a baseball stadium right have seen these types of results. Denver's Coors Field, for example, was estimated to have generated $200 million in overall economic impact and $56 million from sales tax in 1995 alone. Cleveland's planning department estimated that the city's Jacobs Field generated over $500 million in new development and over 25,000 jobs in a 5-year period. And, Baltimore's Camden Yard has been credited with revitalizing Baltimore's downtown and giving a shot in the arm to its Inner Harbor.

But we don't even need to look, that far away. No more relevant example exists than Washington's own MCI Center. It revived the East End of downtown, serving as a catalyst for hundreds of millions of dollars in investment and thousands of job opportunities for District residents. A baseball stadium will similarly revitalize the Waterfront and South Capitol Street Corridor.

I also want to address specifically the funding mechanism set forth in the legislation before us today. It will have a minimal impact on the District.

There are three main elements to the funding: 

  1. A team owner's payment 
  2. In-stadium taxes 
  3. A business gross receipts tax

The first two funding streams have no impact on District residents, except those who choose to go to the stadium.

Some people have argued that the third stream, the business gross receipts tax, would trickle down to DC residents. But the businesses, which will be impacted with this tax, are regional and national and international players. If the tax trickles down, the impact if any is going to be spread out far and wide, to many jurisdictions.

There may be ways we can improve the legislation. I certainly think that the impact of the gross receipts tax on businesses that have low margins must be considered.

And we must look at ways to improve the community benefits package that is being offered. But we must reject the baseball vs. schools argument as a red herring.

We already invest a billion dollars a year in just the operation of our schools. And we have steadily increased that level - from FY1999 to FY2004, the operating budget of DCPS has gone up almost $200 million, even as enrollment has decreased. And funding for charter schools has gone up six-fold.


  DCPS Charter Schools
FY99 $551 million $27 million
FY00 $604 million $28 million
FY01 $629 million $105 million
FY02 $661 million $142 million
FY03 $741 million $125 million
FY04 $743 million $137 million
FY05 $767 million $189 million
NOTE: The figures for DCPS do not include federal or intra-District funding, which total $180 million for FY05.


FY99 $97 million
FY00 $59 million
FY01 $168 million
FY02 $169 million
FY03 $222 million
FY04 $168 million
FY05 $172 million
We recently started a $40 million per year affordable housing fund, through legislation I championed, in addition to the many tens of millions of dollars we already spend on housing through federal support. Last year, legislation Councilmember Evans and I worked on created a new $10 million-a-year neighborhood investment trust fund. And of course we spend hundreds of millions of dollars each year on health care and other social services.


  Human Services Health Mental Health Child   and Family Services
FY02 $205 million $422 million $178 million $152 million
FY03 $218 million $479 million $237 million $140 million
$128 million
FY04 $225 million $458 million $126 million
FY05 $259 million $513 million $158 million $142 million
NOTE: These figures are local funding_ For FYO5 alone the Department of Health is to receive over $1 BILLION in federal funding.

And this is not one area versus the other. No money is coming from existing revenue streams to fund our baseball investment. Not a penny is coming from the schools or social service budgets. And even more importantly, if we do no get baseball, there still won't be a penny more for the school budget.

Our District budget has grown by billions of dollars in the last decade because we have been willing to invest in the city to grow the tax base. Our investments have produced multimillion increases in programs for housing, healthcare, and education.

I'm sure you will also hear from some witnesses who will say that studies have shown that investments in baseball stadiums do not make money for a city. When you listen, though, keep a couple of issues in mind:

  1. Their studies almost always look at cities where a team already plays, and the city is building a new stadium; of course, in situations like these the benefits are minimized. With DC though, we are bringing in a new team and with it a huge amount of new benefits.
  2. Opponents will argue we're shifting entertainment spending from one area to another, and creating no new benefit. But here, people can choose to spend their money very easily in 3 different jurisdictions. We want to take dollars that are being spent in Maryland and Virginia and bring them here! And on top of that, with a growing population in the region, we want to capture even more of this spending pie.
  3. Keep in mind the funding structure we've developed. These are not general obligation bonds that will come directly from people's taxes, like has been done in other jurisdictions. We've developed a very targeted funding program that has a minimal impact on the general population and pulls its funding almost entirely from those who are benefiting from the stadium - the team owners, the fans, and big businesses.

These financing plans, and the economic development benefits of the stadium, are going to be a home run for the District!

On top of the financial benefits, can you imagine the thrill of seeing Barry Bonds smash a home run into the Anacostia River in the 9th inning to win the game for the Senators; or, the excitement of opening day when the president throws out the opening pitch? Baseball might also inspire our kids to try to become major league stars, or star athletes on their high school teams. We support the arts, music, and culture for the same reasons. Sports and entertainment give people an outlet from the daily sameness - people don't live on bread alone - and it provides personal inspiration, especially for our youth.

We have a great opportunity before us. Let's not strike out!

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