Parking at the New Stadium

Today’s discussion will focus on parking at the new stadium. While parking is a critical issue, it must be viewed within the context of building the overall baseball stadium project on time and on budget. We must assess carefully whether any parking proposal adds significant risks of delays and/or risks of not completing the project within the hard and soft caps that the Council set.

The costs of not completing the stadium on time must be considered. If the Sports Commission and the District use reasonable best efforts to complete the stadium by opening day 2008, and it is not completed until after the 2008 baseball season, the additional costs to the District include rent reductions at RFK, higher construction costs, lost stadium taxes, and additional costs of running RFK. The sum of these items could be as much as $30 million if an entire season is lost, depending upon negotiation, arbitration, and the extent of actual damages.

If the team contends that this failure was the result of a lack of reasonable best efforts on the part of the District or the Sports Commission, the team may argue for compensation for its financial losses. Under such circumstances, if the team’s argument were determined to be valid, our current estimates suggest that the District’s hypothetical exposure could increase further by more than $50 million.

If the delay in the use of the new stadium is for less than a full season, or if the stadium can be used but the full program is not finished, the District would not have met its obligations under the Baseball Stadium Agreement and could be liable for damages. The amount of the damages cannot be estimated at this time because they would be a matter of negotiation between the team and the District.

Since the end of May, additional inspections have uncovered more fuel tanks and asbestos in the building formerly owned by the Architect of the Capitol. Although the structure was built to be asbestos-free, refrigeration units were brought in and asbestos was found in the insulation. The removal of this additional oil and asbestos will cost approximately $3 million, which increased environmental remediation costs further to approximately $14.4 million. These higher costs will be paid from the project contingency fund.