Job Creator or Tax Handout?
Advocates say the project would be job creator so lucrative it will pay for itself while critics argue the proposal will amount to an extravagant taxpayer handout to the wealthy owners of the teams’ parent company.
Virginia lawmakers will have to stake their positions on that divide as they take up legislation to make the move possible.
The plan calls for a $2 billion development in Potomac Yard. Monumental has pledged to put $403 million up front while Alexandria would commit $106 million for the performing arts venue and parking. All is pending city council approval The rest of the $1.5 billion in funding would come in the form of bonds that would be issued by a stadium authority which would own the land and buildings and lease them to Monumental.
$1 billion in bond revenue would be repaid by new tax revenues from the project.
Another $416 million in bonds would be repaid through rent paid by the Capitals and Wizards with a commitment to Alexandria for 35 years. Monumental would foot the bill of any outstanding authority debt if they leave.
“Ninety-five percent of this project is being funded by Monumental” according to Alexandria City Manager James Parajon.
But opponents take issue with that characterization. Andrew Macdonald, a former Alexandria council member and an organizer of the Coalition to Stop the Arena at Potomac Yard, pointed out that taxpayers would be on the hook if the arena project generates insufficient revenue.
“Tax revenue is taxpayer money. It does not belong to the governor. It does not belong to the mayor. It does not belong to Ted Leonsis,” states Alexandria resident Shannon Curtis. “It’s public money.”
The group also questioned the projections citing work from sports economists who say that the economic benefits from professional sports franchises are overstated.
Many officials say the Wizards’ and Capitals’ presence is crucial to support to DC’s downtown and do not agree with Virginia poaching the DC teams.
“At any step of the way, this could absolutely still die,” said Justin Wilson, the Alexandria mayor, that supports the deal.
