An oppressive silence reigns over the intersection of N and Half Streets S.E. on a warm Sunday afternoon. Perched sparrows chirp loudly over deserted streets that run through a decaying industrial landscape of warehouses, grassy lots and the occasional abandoned car. By the year’s end, the city government hopes to have these 20 acres of land purchased and flattened to make way for the new home of the Washington Nationals baseball team.
But the land is not as uninhabited as it seems at first sight. On O Street a male sex worker wanders by, declining to offer his real name. He explains that at night, the three shuttered clubs on the block open up to offer a bustling gay and transvestite social scene.
Around the block, on N Street, two elderly gentlemen take in the afternoon sun in front of a low brick row house, one of only a few residences on the site.
From the comfort of his friend Ernest Jay’s stoop, Thomas Butler reminisces about the surrounding neighborhood where he has lived for 71 years. He remembers a time when the sprawling warehouses were all homes, and commuters crossed the Anacostia River in trolleys on a rickety, wooden slat bridge at Eighth Street. Nonetheless, he seems resigned to the fact that the city will purchase his rented house for over $210,000 and probably turn it into a parking lot for baseball fans.
“They’re going to take all of this,” he said, gesturing with his arms over the blighted landscape spread out before him.
Jay, Butler and the other people who live and work in the area are mere cogs in a much larger, several hundred million dollar project to bring professional baseball back to the District. As the Nationals take the field at RFK Stadium for their very first home-opener tonight, the city’s government is betting that the construction of a baseball stadium in Southeast has the potential to transform the economic fortunes of the surrounding neighborhood and the entire city as well.
On Sept. 29, 2004, after years of bids and offers by several competing cities, Major League Baseball announced that it was moving the Montreal Expos to D.C. to play at RFK Stadium for the 2005-2006 season. According to the contract between MLB and the city, the move came in exchange for a promise by the city government to complete a baseball stadium for the team on the Anacostia waterfront no later than March 1, 2008.
The cost for the project was estimated in September by Mayor Anthony Williams’ administration to be about $435 million. According to an estimate released several weeks ago by D.C. Chief Financial Officer Natwar M. Gandhi, however, the total cost could very well balloon to $581 million. Gandhi’s report attributed many of the increased costs to a recalculation of the value of land in the neighborhood that must be purchased by the city.
Gandhi’s higher estimate of the cost of the project remained within the cost limits that the D.C. City Council mandated when it approved financing for the stadium on Dec. 21, 2004. That legislation specified that a proportion of the cost be covered by private funding and placed a ceiling on initial land and infrastructure costs.
To foot the enormous bill for the stadium, the Williams Administration has proposed issuing public bonds for whatever sum cannot be covered by private financing. According to a proposal announced in a Dec. 23, 2004 press release, those bonds are to be paid off over a 30 year period by a rent payment from the Nationals for use of the stadium, taxes on ticket sales and team merchandise and the introduction of a special “ballpark fee” on businesses that gross over $5 million in revenue each year in the District.
On Tuesday, the Washington Post reported that council members were considering two private financing proposals by Deutsche Bank and developer Herbert S. Miller, which would more than adequately provide the required proportion of private financing. The Council has not yet taken up either of the two proposals.
For supporters of the stadium, debates over the nitty-gritty details of costs seem less important when put in the context of the large economic benefits they claim will undoubtedly be showered on the District.
In a March 2003 report to the City Council, analysts concluded that the city should expect to receive well over $500 million over 30 years in total economic benefits. The report, prepared by the facility consultant firm Brailsford & Dunlavey, also concluded that it will provide new jobs for D.C. residents both inside the stadium and in surrounding hotels, restaurants and stores.
With these numbers behind him, Mayor Williams has said that the new stadium will “amplify” a continuing process of development that is taking place along the Anacostia waterfront.
In a triumphant speech announcing the stadium legislation in December, Williams compared the benefits of constructing a new stadium with the successful revitalization of the neighborhood around the MCI Center after 1997.
“The ballpark can have the same impact along the Anacostia Waterfront-creating 3,500 construction jobs and $15 million in direct annual revenue to the city,” he said in his speech.
The economic impact report by Brailsford & Dunlavey estimated that the MCI Center had created 15,600 jobs in D.C. as of Dec. 2002.
Currently the view of the riverbank at the proposed stadium site is dominated by a sprawling asphalt plant and heaping piles of old construction rubble. Under the Anacostia Waterfront Initiative Framework Plan, however, the site will soon become part of Williams’ hope to remake the neighborhoods around the filthy river. Announced five years ago, the plan imagines the development of housing, office space and hiking trails in a wholly marginalized part of town.
According to Andrew Zimbalist, an economist at Smith College and a nationally renowned specialist in stadium economics, the stadium is unlikely to have the direct effect on Southeast’s economy envisioned by supporters. Calling the touted benefits of the MCI Center “overstated,” Zimblalist said that the real benefits of the project would not come from economic activity at the stadium, but from the chance for developers to buy cheap land from the city in exchange for pitching in to offer financial support to the project.
“You have a city that has been growing very successfully and this area is sort of on the periphery,” he said. “It’s the next area of development that can be profitable.”
For a city that has historically lost both population and wealth to the suburbs, the stadium also holds out the possibility of steering suburban dollars back into the District.
That effect will depend on whether the stadium is able to attract suburbanites who do not normally spend their money in the District, according to Zimbalist.
“It doesn’t have a positive effect for the metropolitan area’s economy per se,” he said. “But there’s an opportunity for D.C. to cannibalize revenues from the suburbs.”
Of course, support for the stadium is not all about money. Ever since the riotous final game of the Washington Senators in 1971, when fans stormed the field and carried away the bases, many baseball fans in D.C. have wanted a team of their own. Prominent supporters of the stadium see the project as a way to reconstruct city spirit and raise the image of the city in the nation’s eye.
Williams has hardly ever let an opportunity go by without trumpeting baseball’s ability to unify the community through tradition and a common experience.
Non-economic effects such as these should not be disregarded in the debate over a new stadium simply because they cannot be quantified, emphasized Tim Chapin, who studies stadium projects as an Associate Professor in the Department of Urban and Regional Planning at Florida State University.
“It’s worth something,” he said. “I think a ballpark in D.C. sends a signal to the world that this city is really a neat place beyond the Mall.”
The Mayor’s upbeat predictions have failed to convince Councilmember David Catania (D. At-large), who vehemently opposed the stadium last fall and has publicly refused to attend tonight’s home-opener in protest.
“This is a colossal waste of taxpayer money when we have to fund schools and healthcare centers,” he said.
Catania argued that the stadium should be constructed on land adjacent to RFK stadium that the city already owns. He accused the CFO Gandhi of deliberately undervaluing the land to be purchased in Southeast in order to squeak under the $165 million cost cap imposed by the Council in December.
“Every 10 minutes the price is going through the roof,” he said. “The CFO came forward and said $161.4 million in a very cynical act-he knows damn well that the cap is $165 million.”
Outside the halls of city government, opposition to public financing of stadiums and D.C.’s deal with MLB in particular runs deep among the vast majority of economists and sociologists, who say that expected returns are hardly ever realized.
Kevin Delaney (CAS ‘82), an Associate Professor of Sociology at Temple University, said that tight control of team franchise locations by professional sports associations like MLB and the National Basketball Association, has resulted in a system where cities offer too much to acquire teams.
Cities, he said, are overwhelmingly negotiating from positions of weakness and end up allowing teams to extract unreasonable concessions.
In an open letter to the D.C. City Council last December, Delaney and two colleagues warned the Council that they were essentially being swindled into “the most unequal agreement in the most recent wave of stadium construction that began in 1997.” The agreement, Delaney said, is a giveaway to the Nationals because it requires the government to assume all the costs of constructing the stadium while the team rakes in all the direct benefits.
For Chapin, the D.C. government has approached the economics of stadium building with an almost naively optimistic view from the start.
“I don’t think they’re realizing that the tax revenues they can get from all that spending is not even close to what they actually will be spending,” he said.
The costs of the project, he said, will inevitably go up from those initially provided by industry consultants. “It’s the nature of the industry to go in with very rosy estimates of the costs and benefits,” he said.
Asked to compare D.C.’s proposed ballpark with stadium projects in other cities, Chapin listed Camden Yards in Baltimore and Jacobs Field in Cleveland. The former, he said, had been a failure in stimulating the local economy; the latter, a resounding success.
If D.C. wishes to successfully develop the neighborhood around the new stadium in Southeast, Chapin said, a concentrated development effort must be exacted on the neighborhood around as well. Limiting a wasteful spread of open parking lots, maintaining some of the old urban landscape and investing heavily in local businesses all would help to make or break the local neighborhood’s economy, he said.
“These ballparks are not guaranteed to have that catalytic effect on the surrounding neighborhoods,” he said.
The debate over how to approach development in Southeast is both very relevant and very far away for Dinesh Tandon, who owns a local cab shop and 15 cabs within one block of the proposed stadium. Through the open window of one of his aging Crown Victoria taxis, Tandon said that he has not yet heard from any city representative, but privately he expects to have his business forced out by the end of the year. After having purchased the business only three years ago, he worried that he his business might necessarily fold under the intense cost of relocating the heavy equipment of his shop to another neighborhood.
Wondwossen Bka, the manager of a neighboring garage, merely shrugged his shoulders in resignation when asked how he felt about possibly not having a job by the end of the year.
“But what can we do? It’s the government, you know. There’s no use complaining about it,” he said.
