Councilmember Carol Schwartz
November 30, 2004
Madam Chair, I was excited about the prospect of baseball returning to
the District. I was looking forward attending a major league game in this
city and rooting for the home team. But, then I saw the deal.
I understand that the District must be willing to concede certain
things to Major League Baseball to get a team and I am more than willing
to do so. However, I am not willing to give the store away—and
that is exactly what the legislation before us, as it stands today, will
This deal was negotiated grossly in favor of Major League Baseball. I
often wonder who was negotiating for us – who was protecting the
interests of the District!
There are so many examples of why this is a bad deal for the
District, but—because of time limitations—I will only elaborate on
what I think are the most egregious.
The District is required to pay for any cost overruns for the
construction of the stadium, and who knows how much that could be? We
haven’t even broken ground yet, and the CFO has already upped the ante
by $91 million, and our auditor even more! In addition, the cost of any
environmental cleanup of the site has not yet been factored into the
current figures, nor have costs associated with any water level problems
caused by the site’s proximity to the river. And we don’t even own any
of the land, so we will have to negotiate with 65 different property
owners with great potential for additional costs, court cases, and delays.
Those delays would mean not just construction cost overruns, but huge
compensatory damages that would be owed under this agreement to the team
owners. And this is perhaps my greatest concern.
And – listen up here folks. If the stadium is not completed by March
1, 2008, the team is entitled to recover compensatory damages from the
District, including without limitation, lost profits derived from private
suites, club or other premium seats; parking, concessions, naming rights
and other advertising, signage and sponsorships, and other costs incurred
by the team as a result of the missed deadline, and this is irresponsible.
So, in essence, the Council would be writing a blank check to Major
League Baseball. And, when all is said and done, it is not hard to imagine
us looking at a final price tag of closer to $1 billion.
On the other hand, if the District builds the stadium and the team
decides to leave DC before the end of the 30-year lease, the District is
then entitled to damages. How much? We don’t know because the agreement
provides that that little detail will be negotiated later in the lease. I
can just see it now…when we finally get to the lease, the team offers us
$3.00 if they leave early, and we balk and say it should be $300 million,
not $3.00. Then people start saying we have to take the $3.00 or the team
will walk. And, of course, we take it – tough negotiators that we are.
I am also not convinced that the Anacostia Waterfront is the best
location for a stadium. This site is already home to tax paying
businesses, whose tax dollars we will lose when we displace them.
Furthermore, there are numerous construction cranes dotting the skyline in
that area, so economic development around this site has already begun in
earnest without the stadium. I recently spoke with a developer’s
representative who told me that they attempted to do another project in
that area but was told "No" by the city. I can’t understand
why the city would impede a private developer’s efforts to develop the
waterfront and then ask the taxpayers to subsidize a stadium in that area
to spur development.
I also have concerns about the level of business taxes that would be
levied to pay for the stadium. Now, proponents of this legislation have
often indicated that the same thing was done for the MCI center. But, it
was really quite different. The legislation before us today would require
the top tier businesses to pay $48,000 per year for the next 35 years.
That’s $1.68 (one-point-six-eight) million for each business! That’s
quite a burden to place on businesses that can easily walk away from the
District and take their jobs with them. By contrast, according to the CFO’s
office, the top tier businesses under the MCI legislation paid a mere
$11,000 per year for 6 years for a total of $66,000. That’s not even
close to comparable in my book.
For all of this investment of District taxes the District gets a team
and not much else. We don’t get any portion of the naming rights of the
stadium that we are building and will own. And, we only get to use the
stadium for other purposes for 12 days per year. Whoopee! The rest of the
time the team owners can rent our stadium out and get paid for it.
This baseball proposal has caused me great consternation, and rightly
so. Do I want to be remembered as someone who helped kill off baseball?
And the answer is no. But do I want to be remembered as someone who helped
cause financial instability to return to the District, after working so
hard to regain it, and then to maintain it? The answer is an even more
For these reasons – and more – I intend to vote "no" on
the legislation before us today. I do hope a better deal will be
negotiated before the second vote, so that I might be able to vote
Thank you Madam Chair.