As the dust settles around Ted Leonsis’ explosive announcement about the Washington Capitals and Washington Wizards’ likely move to Potomac Yard, local advocates ponder what, if anything, could’ve prevented this economic conundrum.
Niciah Petrovic Mujahid, executive director of the Fair Budget Coalition, said the writing was on the wall this summer when elected officials and constituents warned D.C. Mayor Muriel Bowser (D) against focusing on developing the dormant RFK campus rather than Capital One Arena.
Shortly before Leonsis and Virginia Governor Glenn Youngkin (R) revealed their plans for a $2 billion state-of-the-art stadium in Alexandria, Virginia, Bowser and the D.C. Council unanimously introduced legislation that infuses half-a-billion dollars into the Capitals and Wizards’ current home.
While Mujahid understands the logic behind that move, she told The Informer that the situation in its totality reveals an ongoing problem within the Bowser administration. “There’s a lack of political will to prioritize folks’ needs,” she said. “The council and mayor are struggling to allocate resources [to address] domestic violence and harm reduction. We don’t have groceries in Wards 7 and 8.”
A Question of Priorities
If passed, the legislation, titled the Downtown Arena Modernization and Downtown Revitalization Act of 2023, will facilitate upgrades to Capital One Arena, based in Gallery Place-Chinatown. Upon receiving the authority to extend a lease agreement, the District would finance $500 million toward a three-year, $800 million renovation project slated to start in 2024.
On Dec. 13, Bowser mentioned a refinancing deal that gives D.C. more latitude to utilize funds from its capital improvement budget. This happened amid attempts by D.C. Councilmember Christina Henderson (I-At large) and others to stop Bowser’s use of nearly $40 million in Supplemental Nutrition Assistance Program benefits for other budgetary matters.
As it relates to D.C.’s budget, public transportation patrons are also railing against a Washington Metro Area Transit Authority (WMATA) proposal that reduces service, closes nearly a dozen stations, and triggers layoffs.
Days before WMATA General Manager Randy Clarke released that proposal, the D.C. Tax Revision Commission drafted “revenue neutral” recommendations that didn’t include an increase of tax revenue, either on businesses, homeowners, or other entities.
Civil rights attorney Ari Theresa tied the District’s current economic woes to what he described as the prioritization of corporations over the collective well-being of District families. He expressed his desire for a revitalized Capital One Arena that includes free, public spaces for all D.C. residents and visitors.
In 2018, Theresa, a Southeast resident and attorney with Stoop Law DC, filed a class-action lawsuit against the D.C. government for its alleged enactment of policies he said decimated the affordable housing stock for District families. A District judge dismissed that case years later, citing no constitutional violations of property rights and renters rights.
Theresa told The Informer that, since then, prominent areas of commerce, like the D.C. Wharf in Southwest, and City Center in Northwest, have further marginalized working-class Washingtonians, especially young people.
“The D.C. Council should really explore some new ways of doing things,” Theresa said. “Some of the places [across the city] are awash in government money. The parking costs too much and the businesses have left. A lot of the venues are expensive. The housing is expensive. Very high-end development that’s not inclusive.”
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A Discussion That’s Just Starting for Virginia
Youngkin’s deal with Leonsis, subject to Virginia General Assembly approval, issues $2 billion in bonds to a newly formed Virginia stadium authority for the construction of the Potomac Yard-based entertainment district.
The project, to be completed by 2028, will include a sports arena, Wizards practice facility, performing arts venue, and expanded e-sports facility.
Monumental Sports & Entertainment, through a 40-year lease, would repay the bonds via rent payments, revenue from arena parking, and incremental taxes. It would also invest $403 million into the project, while Alexandria will contribute a total of $106 million toward the construction of the performing arts venue and underground parking facility.
The deal elicited criticism from protesters who converged on Potomac Yard on Dec. 13. Some state lawmakers also reportedly expressed concerns about other budget priorities relevant to Virginia’s most vulnerable residents.
On Monday, Alexandria Councilmember John Taylor Chapman (D) took to the social media platform X and responded to Sen. Mark Warren’s support for the deal with a retweet and “Yessir!”
Chapman, a member of the Alexandria Economic Development Partnership, said that, as the Virginia General Assembly prepares to mull over the $2 billion deal, Youngkin will have to yield to the demands of state house and senate Democrats.
While Chapman acknowledged constituent concerns about the financing structure of the deal, he told The Informer that this particular deal differs from others, much to the benefit of Virginia taxpayers.
Chapman still cited the need to further explore the economic ramifications of a new arena and how it would affect traffic in Alexandria and Arlington. To that end, he suggested that some thought go into expanding the region’s public transit and commuter capacity.
Those conversations, Chapman said, would take place at public forums in his jurisdiction and throughout the state in the coming weeks and months.
“The deal is far from done. There are areas to be negotiated,” Chapman said. “If this deal moves forward, fully funding Metro on the Virginia side would happen. You’ll see the enlargement of certain Metro sites. You’ll see more discussion about housing, small businesses, labor and worker rights, and pay and equity. There’s a lot to discuss that hasn’t caught attention yet.”