2024-02-13 05:06:07
The Virginia House of Delegates advanced legislation that would allow Monumental Sports to build a new arena for the Washington Capitals and Wizards in Alexandria. A third reading and final vote in the full House is set for Tuesday.
Earlier Monday, Senate President Pro Tempore Louis Lucas (D-Portsmouth) declared the deal dead in her eyes, referring to the arena as the “half-baked Glenn dome” and saying Republican Gov. Glenn Youngkin isn’t collaborating with Democrats who are concerned regarding the level of financial risk.
Over the weekend, Youngkin participated in a mock presidential convention at Washington and Lee University alongside Donald Trump Jr. in which the governor gave a very partisan speech that did not sit well with Democrats he needs to get the arena deal done.
“We definitely had concerns regarding whether the governor is willing to consider our priorities,” said state Sen. Scott Surovell (D-Fairfax). “This is his priority; we have priorities as well. We’ve had several conversations regarding that. He’s never expressed really an openness to discussing — except for Metro, I guess — other than that — cannabis, minimum wage — he’s not really expressed an openness to discussing it, and the speech he gave this weekend was highly partisan and gave a lot of us and a lot of the people in our caucus a lot of concern regarding whether he’s really, truly serious regarding working with us or not.”
Youngkin’s office declined an interview with News4 Monday but offered a statement, saying in part that the governor is confident the General Assembly will come together because the project is good for the entire commonwealth.
“It creates 30,000 jobs and unlocks billions in new revenue that can be used to fund expanded toll relief in Portsmouth, increased funding for I-81, and new money for education for rural and urban school divisions across the commonwealth,” Rob Damschen, Youngkin’s communication director, said in a statement.
If the legislation passes the House Tuesday, it moves over to the Senate, where — based on what Democrats said Monday — the future of the deal anyone’s guess.
Virginia Senate refuses to vote on its version of the legislation
The Senate refused to docket its version of the bill and is waiting for the House’s version.
“I am not going to allow the governor to endanger the commonwealth’s stellar bond rating on my watch,” Lucas said Monday at a committee meeting that was not scheduled to address the arena. “I will not allow a billionaire to build his company’s wealth on the taxpayer’s dime.”
Surovell said he doesn’t think the bill is dead yet but added, “Something is going to have to change pretty soon for the patient to get off the surgery table here.”
Lucas was asked if changes to the House version of the bill, which will eventually be before her committee if it clears a House floor vote, might make the proposal palatable.
She answered by saying she had a strenuous objection to the project financing as currently envisioned because of its use of moral obligation bonds backed by the state and by Alexandria. That means taxpayers might be on the hook if the project revenues don’t come through as expected.
“As long as the full faith and credit of this commonwealth is backing this project, my answer continues to be an absolute no,” she said.
Surovell said Senate Democrats had asked questions regarding financing the deal another way but were told “that piece of the bill is untouchable.” He added that he was unaware of moral obligation bonds — which are typically used in Virginia to help finance public infrastructure projects — being used for any similar economic development initiative.
Senate Republicans criticized Lucas’ refusal to put the bill up for a committee vote, characterizing the move as a “pocket veto” of the governor’s priority.
Youngkin and entrepreneur Ted Leonsis, an ultrawealthy former AOL executive and the CEO of the teams’ parent company, Monumental Sports and Entertainment, announced in December that they had reached an understanding on a deal to relocate the Capitals and Wizards.
The proposed new site in Alexandria would be just miles from where the teams currently play in Washington.
The legislation currently pending before the Assembly would set up a sports and entertainment authority that would issue the bonds that will help pay for the project. The bonds would be repaid through a mix of revenues from the arena and broader development surrounding it, including a ticket tax, parking fees, concession taxes, income taxes levied on athletes performing at the arena, and naming rights from the district, among other sources.
Monica Dixon, a top executive at Monumental, said in a written statement Monday that the company is having “healthy discussions” with General Assembly leaders and Alexandria City Council members, who will also need to sign off on the deal. Dixon said the company is encouraged by Friday’s vote in a House committee, where the bill passed 17-3.
D.C. Mayor Muriel Bowser and Capitals and Wizards owner Ted Leonsis sparred online over whether Monumental Sports can get out of its lease for Capital One Arena and move to Northern Virginia. News4’s Mark Segraves shares updates.
Battle brews in DC over breaking Capital One Arena lease
D.C. Mayor Muriel Bowser, in an op-ed piece that ran in Sunday’s Washington Post, urged Monumental to consider the city’s offer of $500 million to be used to renovate Capital One Arena in Washington. If Monumental leaves for Virginia, Bowser said the city will enforce the terms of its lease.
Under that lease, the Capitals and Wizards were expected to play at Capital One Arena through 2047, but the teams can break the lease as early as 2027, so long as they fully pay off $35 million in bonds that are currently outstanding.
There is no provision, though, for Monumental to break its lease for the WNBA’s Washington Mystics, who play at a smaller arena in the city and have lease obligations that extend until 2037.
Monumental said back in December it would like to move the Mystics to Capital One Arena when the Wizards and Mystics move to Virginia. But in a social media statement Sunday responding to Bowser, Monumental said it will keep the Mystics at the smaller arena through 2037 if the city insists.
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