Washington baseball stadium clears last big hurdle

By David Lawder

WASHINGTON (Reuters) – Washington’s planned waterfront
baseball stadium cleared its last major obstacle on Monday
after the city and Major League Baseball signed a 30-year lease
that caps city-funded costs at $611 million.

District of Columbia Mayor Anthony Williams said on Monday
that he and the D.C. Sports and Entertainment commission signed
final lease documents for the Washington Nationals’ new home,
clearing the way for a $534.8 million sale of revenue bonds to
finance construction.

Major League Baseball, which owns the Nationals, signed the
agreement on Sunday, ending nearly a month of suspense over
whether the league would accept the cost cap or seek to move
the team elsewhere.

The city council imposed the ceiling on February 8 in
emergency legislation specifying that any cost overruns were
the team owner’s responsibility.

City officials said the bond sale could take a month to six
weeks to complete. District of Columbia Chief Financial Officer
Natwar Gandhi is traveling in India until March 23 but is
expected to work on the transaction while he is away.

The lease signing, coupled with a contract with Clark
Construction Co. expected to be approved by the city council on
Tuesday, ends more than a year of wrangling over project costs
since the city first agreed in December 2004 to build the
stadium — a deal that brought the former Montreal Expos to the
U.S. capital last year.

“The signed lease is the green light we needed to turn this
dream into a reality,” Williams said in a statement.

Williams sees the stadium as a catalyst to revitalize a
run-down neighborhood of vacant lots and warehouses on the
Anacostia River one mile south of the U.S. Capitol building.
The city has sold development rights for adjacent properties to
develop bars, restaurants and retail stores to capture game-day
traffic and bring in new revenue to the city.

Although Major League Baseball nominally accepted the $611
million cost cap, it stipulated in a letter to Williams that
contingency funds required by its bond indenture be made
available to help finance the project if necessary.

It also stipulated that the lease would not become
effective until the bond sale is complete and that any new
conditions imposed by the council would void the lease.

“Everyone has to compromise so the Nationals can enjoy a
strong future,” MLB President Bob DuPuy said in a statement.

MLB, which bought the Expos in 2002, has held off on
selling the team to one of several bidders until the stadium
deal is finalized. The 29 major league franchise owners are
expected to pocket a hefty profit, partly because of the
lucrative stadium arrangement and the strong Washington-area
economy.

The city is required to complete the new stadium in time
for the 2008 season. The Nationals intend to play in the
45-year-old Robert F. Kennedy Memorial Stadium until then.