DC Council Vote For Nats Lease and Construction Contract
7th March 2006
Today, the DC council will vote whether to reaffirm a $611 million package to allow construction of a new facility for the Washington Nationals on the Anacostia waterfront.
Those that have Windows Media Player will be able to watch the Council vote by selecting this link. I will be blogging the proceedings, adding commentary, and adding — if an — news that I recieve on the deal.
As of last night, here’s where things are now at. Read Is Our Long Nationals Nightmare Over? for an overview from yesterday:
- Chief Financial Officer Natwar M. Gandhi yesterday certified by letter that the deal brokered by MLB, Mayor Williams, and the DC Sports and Entertainment Commissioner (DCSEC) has a legal “acknowledgement” to cap the total public expenditure cost at $611 million.
- By Gandh’s review, “the Team and the Commission have agreed that the Cost Overruns, if any, shall be paid solely and only by sources identified”. Those sources are the Nationals, the federal government, developers, other private funds, or excess tax revenue. The later can only occur be approval through the DC council.
- Mayor Williams, Mark Tuohey of the DCSEC, and CFO Gandhi have signed the lease agreement.
- The DC council will vote whether to reaffirm the spending cap within the lease today.
- In a seperate vote, the council will vote on the Design Build and Completion Guarantee Agreement, which will allow the three construction companies hired to build the ballpark — Clark Construction Group, Hunt Construction Group and Smoot Construction — to start construction of the stadium.
- The Design Build and Completion Guarantee Agreement, if approved, places would cap construction costs at $320 million and reduce the companies’ fees by $100,000 a day if the stadium was not completed by March 1, 2008. This contract places control of the stadium construction project with the companies building the facility (Clark Construction is the lead contractor), removing the risk from the city to complete the stadium on time, and on budget.
- The contract also includes a cap of an additional $68 million for “soft construction costs,” including fees to architects and consultants.
- As of this writing, the general consensus is there are enough votes on the council to approve the two seperate votes today.
Stay tuned here as I post comments throughout the day. The time of the actual ballpark releated votes is not lsited on the council’s agenda.
Related articles from today:
- Washington Times: Mayor, officials sign off on lease
- Washington Post: D.C. Exempt on Stadium Overruns
- Washington Post Editorial:The Council at Bat
March 7th, 2006 at 8:14 am
11:11am EST update: I am hearing rumblings at this early hour that at this time all the votes are not lined up for passage. This appears to be nothing more than non-committal conversation due to the actual lease document being given to all members of the council over the weekend, with little time to absorb the contents.
March 7th, 2006 at 8:56 am
11:51am EST update: Proceedings in the council chambers have started. Councilman David Catania, one adamantly opposed to the stadium deal, asked about parliamentary procedure within the Council.
Catania asked about where on the agenda the reaffirm vote was at – it was originally on the consent agenda but is now on the non-consent. Councilchair Linda Cropp pointed out where it was at on the agenda, and mentioned that she would be happy to move it to the consent agenda (doing so would have signaled a unanimous vote). This was all done with much laughing and smiles. Catania, needless to say, asked for the matter to remain on the non-consent part of the agenda.
The consent agenda has now been completed, and the council has ajourned for lunch (one wonders if crow will be served in some capacity).
The Final Reading and Final vote is where the lease deal is.
March 7th, 2006 at 9:16 am
12:15pm EST update: While the council is at work, the game isn’t on yet (other matters on the agenda are being addressed, and the ballpark related items have not yet come up).
With some time to burn, something to digest while waiting…
There has yet to be a stadium deal with any level of public subsidy that has not been divisive in the jurisdiction which the planned ballpark is being built.
In the case of DC, the protracted process, and passions on both side of the aisle has created a good deal of acrimony.
For one, Major League Baseball had been absent from DC for 34 years. Attempts to bring about the return of MLB to the District over the years has brought up the discussion as to whether the market was truly interested in MLB, given the loss of the Senators (twice). Race, unfortunately, was part of this discussion when Bob Short ran the Senators, and Orioles owner Peter Angelos said in 2004, “There are no real baseball fans in DC,” and said that his franchise would be impacted to the tune of $40 million a season, fueled the debate within baseball circles.
On the other side of the ledger is the fact that eminent domain is going to be applied to the procurement of the land parcels needed for the stadium footprint. To add more controversy to this issue is the fact that businesses that cater to alternative lifestyles are within the path of the stadium development. This has brought the gay community into the discussion.
If today is indeed the day that the stadium in DC becomes a reality and the roadblocks are removed, it should come as no surprise that many are breathing a sigh of relief. The DC councilmembers, alone, have aged faster than normal over the course of this circus.
March 7th, 2006 at 9:28 am
12:30pm EST update: WTOP is reporting that Catania has relented and believes that passage today is imminent. As mentioned, Catania has been vehemently opposed to the stadium deal.
March 7th, 2006 at 10:12 am
1:10pm EST update: There are still no ballpark related activities occurring at this time from the dais.
March 7th, 2006 at 11:23 am
2:25pm EST update: We’re still on the Living Wage debate. No baseball… yet.
March 7th, 2006 at 12:51 pm
3:51PM EST update: This is what we call a teaser… the council is now debating school improvements. Any hope of getting the ballpark related items out of the way early are clearly out the window.
Back to the “teaser”…
Last time the day went like this on the council and baseball, there was a sudden rush of motions and suddenly the baseball related issues were front and center. Check… back… often.
March 7th, 2006 at 2:33 pm
5:30pm EST update: Not quite an update… Folks, the baseball related matters will be arriving later in the evening. At 5:15, Councilwoman Cropp said, “Come on people, we’re only half way through the agenda.” As I was typing here, Cropp announced that the Council would take a 15 min. break to come back, “refreshed.”
I’m sure the suspense is killing you.
March 7th, 2006 at 2:38 pm
5:40 pm EST update: BALLPARK MATTERS SHOULD BE NEXT:
I have gotten word that the Construction Contract will be up after the break. The vote to affirm the lease will be later. One would think that is the Construction Contract passes, the lease would be a go, as well. After all… why vote yes on the contract if the lease somewhat nullifies it in terms of execution?
March 7th, 2006 at 3:01 pm
6:00 pm EST update: Gotcha! Well, it was supposed to be coming up right after the break.
Cropp is going to move through votes on resolutions in blocks. Get ready…
March 7th, 2006 at 3:03 pm
6:03 pm EST update: Construction Contract up… Evans at the mic.
March 7th, 2006 at 3:07 pm
6:07:
Evans is reminding the Council on these points:
The Design Build and Completion Guarantee Agreement, if approved, places would cap construction costs at $320 million and reduce the companies’ fees by $100,000 a day if the stadium was not completed by March 1, 2008. This contract places control of the stadium construction project with the companies building the facility (Clark Construction is the lead contractor), removing the risk from the city to complete the stadium on time, and on budget.
The contract also includes a cap of an additional $68 million for “soft construction costs,” including fees to architects and consultants.
As well as District resident hiring, etc.
There are exceptions… Natural acts of God, terrorist attacks, strike, etc.
March 7th, 2006 at 3:13 pm
6:09:
Cropp talking oversight. Reason? If the costs are capped, the council wishes to be kept abreast of the issues. Cropp proposes a taskforce for regular updates on the status on costs, etc. of the construction timeline. Cropp wants updates on “Value Engineering.” Appoint one or two members of the council to give advice. Ongoing reporting by the council member, or members that are on the oversight committee and report to the committee of the whole so that the council and the public can be made abreast of the construction process.
Stay within cost and be timely. Cropp will come back with specific structures of the task force.
March 7th, 2006 at 3:17 pm
6:13:
Catania up…
Not surprisingly, he’s zeroing in on the cost overrun issues. Talking to the “change to work orders.”
His points… If a cost is projected and the actual costs. Catania saying that Clark has lowballed line items, and that MLB will balk.
But… Catania says, “It’s clear this thing is going to pass,” in reference to the lease agreement. Key comment
March 7th, 2006 at 3:25 pm
6:18:
Brown at the mic…
To Evans… How did the GNP come to play?
Referencing the Building Program to which the costs were projected by Clark. The question is, “If a projected cost is $7 mil. for a scoreboard, and they come back with a $50 mil. price, who is on the hook?”
Evans responds that it is not disputable. “They would be responcible.”
Discussion is now on the timely turnover of the site if it goes past June 1st. This deals with getting the project in on time (March 2008). Evans is not sure who is responcible for the costs if this date is missed. This relates to extra man hours to get the project done by the March 2008 date.
March 7th, 2006 at 3:30 pm
6:24:
Fenty up for discussion…
He believes that cost overruns will fall on the District of Columbia. Subject is the ballpark revenue funds. Taxpayers (general fund) may not be targeted, but Fenty sees the ballpark revenue funds having to go to cost overruns, as opposed to paying the debt service.
Fenty says no project never comes in under a guarenteed maximum price. Lists 8 itmes like inspections, permits, qualification and exclusions, et al.
Mentions that project costs such as these that total costs will be 20% over the GNP.
Fenty says he will vote no.
March 7th, 2006 at 3:33 pm
6:30:
Catania mentions that this agreement is between the city and Clark, and that MLB will, most likely, not approve many facets of the agreement that Clark and DC make. Catania sees this as an issue, and if there is conflict and DC challenges it goes to arbitration, it would greatly impact the deadline… Clock runs, and that creates overrun.
“MLB hasn’t agreed to these low budget items. They do have a roll as to how it is implemented.”
March 7th, 2006 at 3:37 pm
6:34:
Evans takes issue as to comments as to whether this deal is the same as the deal that was brokered in 2004. Mentions that a new owner should be in place within a month.
Evans says that the deal was altered from the BSA originally brokered between MLB and DCSEC and Mayor Williams to cover costs.
March 7th, 2006 at 3:48 pm
6:40:
Barry at the mic (bare with me as I try to decipher)…
Says that he thought (thinks) it was the worst deal since the great train robbery and Jesse James. Thinks the deal is better, but still not good.
He feels that the DCSEC will be on the hook if there are overruns. Mentions that he doesn’t see the feds jumping in to bail out the DCSEC.
Question to the chair: Can the Council pass emergency legislation to stop all funds if Clark were somehow spending inappropriately over the hard and soft monies costs?
General council says, “Can go to court. Could be remedies by going over what has been mandated.”
Barry: “What happens if the stadium is 90% finsihed and the funds run out? There would be too much pressure to stop from helping.”
Cropp: “Completion guarentee would cover the deal and value engineering should be in play from the beginning.”
Cropp brings up that ownership would not let it sit if it was 90% completed and funds ran dry. Cropp sees ownership losing $40 million in luxury suite revenues.
She sees that ownership and MLB want to move forward.
March 7th, 2006 at 3:53 pm
6:48:
Graham…
Opposition was swept aside on the initial vote, and doesn’t see enough votes to overturn tonight. His point? Why debate? The deal is going to go through.
He sees this deal as “financial musical chairs.”
He sees MLB/”the team” is off the hook for cost overruns.
Graham listing provisions that will cause overruns due to delays (read: red tape).
March 7th, 2006 at 3:57 pm
7:00:
Motion to close debate.
Vote to close.
Vote fails.
More debate.
March 7th, 2006 at 4:00 pm
7:00:
Schwartz…
“The deal was shoved down my throat by other members.” I feel like I’m stuck between a rock and a hard spot.
“I do love baseball.” (yes, she said this again).
March 7th, 2006 at 4:04 pm
7:01:
Fenty… “How much money is baseball going to make on this deal?”
$300 million will be made on top of the aforementioned $40 mil. in revenues through luxury suites.
Back to the city picking up the tab. Believes the reality is that the feds, owners, or MLB, will not pick up the charges.
March 7th, 2006 at 4:08 pm
7:05:
More Catania…
Excusable delays. Mentions that under terms of the agreement to get the project completed, the contract outlines that the land was to be available by March 1st. His point being that already Clark has loopholes in which they are off the hook.
Let’s be honest. We need cost oversight. Need to get creative to lower costs.
March 7th, 2006 at 4:09 pm
NOTE: I WILL NEED TO STOP BLOGGING AT 7:30PM AND WILL PICK UP ASAP.
March 7th, 2006 at 4:12 pm
7:07:
Evans mentions that the vote needs to move forward. That this is the best deal they can get.
March 7th, 2006 at 4:14 pm
7:15:
Schwartz: Hates the lease, “If I could destroy it, I’d destroy it. If we went to arbitration we’d not do well. We’ll be stuck with this deal regardless of how the deal goes.”
“I feel stuck. And I don’t like being stuck.”
Threatens members of the DCSEC that if the deal goes bad, she’s voting to remove members (assuming this is pointed at Tuohey)
March 7th, 2006 at 4:19 pm
7:16
Cropp…
“The $20 mil. being argued on that wouldn’t be there if not for baseball.” Talking about the rent the team will have to pay.
“Let’s be clear. We as legislators need to look at the large picture.”
The Council has to approve any tax revenues being used for overruns.
March 7th, 2006 at 4:21 pm
7:21:
Barry… It was a bad deal, but I made some adjustments and I want baseball here.
(NOTE: Much of these comments are so that they are captured for the public record. Clearly, it looks like the vote is going through.)
March 7th, 2006 at 4:24 pm
7:23:
Cropp goes over more details of the proposed task force. Asks for input from the council.
The taskforce would, “Monitor, evaluate, and be watchdogs.”
March 7th, 2006 at 4:29 pm
7:25:
Orange…
Says the deal being discussed is the same deal that was done on Feb. 7th.
“This law has not changed.” He sees the point of contention being the $20 mil. in ballpark tax revenues.
” It’s not going to get any better. We don’t like MLB and MLB doesn’t like us.”
March 7th, 2006 at 4:34 pm
7:32:
Move to close debate
Motion to close.
Motion fails
March 7th, 2006 at 4:36 pm
7:35:
I need to tend to life outside of this all-day event for a bit. I will be back ASAP.
To continue to monitor matters, see Maximus and my friends at The Ballpark Guys
March 7th, 2006 at 6:01 pm
9:01:
As I come back, I see that the vote has occurred:
It passed 9-4 on the Construction agreement passed.
The reaffirm vote on the lease passed, as well… 9-4, without the need for a rollcall.
That’s it folks…
2 solid years is now done as far as DC politics goes. There will be a new Nationals ballpark on the Anacostia waterfront.
Thanks for reading today.
–Maury Brown
March 8th, 2006 at 6:57 am
Great update Maury. If I didn’t know better, I would say the DC Council was waiting until you left your computer, before voting on the stadium?
March 9th, 2006 at 10:56 am
[...] With articles coming due for The Hardball Times, and Rotoworld, I have bumped into a bit of writers block for the blog today. When all else fails, I can rip off Brian Borawski and do a Business of Baseball report. Since I covered the situation in DC regarding approval of stadium funding for the Nationals, let’s get caught up elsewhere… Selig reponds to Game of Shadows: He said he’d rather have a root canal than have to deal with this issue, but none the less, Selig was peppered with questions yesterday about the book forthcoming by two highly respected investigative journalists for the San Francisco Chronicle about Barry Bonds and steroid use. I have the complete transcript of Selig’s Q&A here on the blog, but needless to say, Selig is going to be looking it over closely. Said Selig, “I will review all the material that’s relative in every way. And obviously, we’ve only seen parts of things. And the book itself doesn’t come out until the end of the month, but we’ll review everything that there is to look at.” [...]