Monday 12 February 2024

Monumental Arena Snags

If you've been a reader of this blog for any length of time, you're quite aware of my stance when it comes to building new arenas. Far too often, we see politicians give into millionaires and billionaires when it comes to them having a shiny, new toy, and often that comes at the expense of public services and/or liquidity for that city or region. For those that have missed the memo, the artist's rendition of the arena site above is what Ted Leonsis is hoping to build in Alexandria, Virginia at a $2 billion cost, and he'll pay just $400 million of that total. If you heard some feathers rustling, that was me getting ready to take another swipe at Leonsis and his proposed arena "deal".

However, a weird and unexpected thing happened today that may have greater far-reaching consequences because it seems people are coming to their senses, even if that's happening indirectly, as politicians in Virginia seem to have differing opinions on this blockbuster land deal. Lo and behold, Senate President Pro Tempore Louise Lucas "declared the deal dead in her eyes" today, adding that "Republican Governor Glenn Youngkin isn't collaborating with Democrats who are concerned about the level of financial risk."

Colour me shocked and flabbergasted that there are politicians talking about the financial risk associated with building an arena complex like one proposed by Monumental Sports. We've heard the oft-cited studies that claim how arenas benefit no one except for the teams using them, and it seems like that message finally may be getting through to those who hand over millions of dollars of public money on the promises of windfalls that never materialize.

Rob Damschen, Youngkin's communication director, pushed back in a statement to reporters, saying, "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."

Well, it seems someone didn't do the assigned reading. We already know that the vast majority of jobs created are temporary, not permanent, and the majority of new, permanent jobs won't even come close to being in the thousands. How it "unlocks billions in new revenue" clearly needs some explanation because not one arena built since the turn of the millennium has generated that kind of revenue for anyone but the arena owner, but that incredible lie sounds awfully enticing to political minds that look for any and all revenue sources that they can find. Clearly, Damschen is reciting word-for-word from the "Owner Cries Poor" manual when it comes to building a new facility. None of it is actually true.

What is true is that the Republican-led House of Representatives will pass the bill for Monumental Sports' monstrosity of an arena complex on Tuesday when it goes to a vote. The Democrats in Virginia hold the Senate, though, and this bill may run into some stiff opposition from that group as Democratic senators more concerned with fiscal responsibility than their Republican counterparts.

"I am not going to allow the governor to endanger the commonwealth's stellar bond rating on my watch," Lucas stated matter-of-factly on Monday at a committee meeting. "I will not allow a billionaire to build his company's wealth on the taxpayer's dime."

Democratic Senator Scott Surovell added, "Something is going to have to change pretty soon for the patient to get off the surgery table here."

Death metaphors aside, it sounds like the politicians need to do some politicking if Youngkin is going to be able to bring out the oversized pair of scissors for a ribbon-cutting in the future. Surovell has suggested some area of compromise that may help sway Democrats in the vote - namely, legal cannabis sales and minimum wage increases - but it seems that Youngkin has yet to even speak to his colleagues across the aisle about anything in the arena deal.

Knowing that, Surovill told reporters that "Senate Democrats had asked questions about 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."

With the Democrats sounding like they're unwilling to move in this vote without concessions made by the Republicans, funding for this arena project seems to be off the table meaning Monumental Sports will end up being about $1.6 billion short of their needed financial means to build their massive entertainment complex. If Ted Leonsis isn't going to dip into his personal saving account, it would seem like this arena deal may evaporate as quickly as it materialized.

Adding to the mounting headaches that Ted Leonsis is facing is the mayor of Washington, DC in the Honourable Muriel Bowser. In an op-ed that ran in Sunday's edition of the Washington Post, the Mayor "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."

She also didn't mince words about the steps the city was willing to take if Leonsis chooses to leave Capital One Arena, writing, "But let me be clear: The city owns the land under the Capital One Arena and will own the building should Monumental break its lease," and used Leonsis's own words against him when she added, "It's only right that D.C.'s teams stay in D.C. Leonsis has previously acknowledged the huge responsibility that comes with owning a team, saying 'the teams really aren't owned by me and my partners; they're really owned by the city itself.'".

One should remind Mayor Bowser that Landover, Maryland where the Capitals once called home is technically the same distance away from downtown Washington as Alexandria is, but I'm not here to nitpick. Instead, I'm here for seeing a mayor call out a billionaire over his arena demands when she capped off her op-ed with "Now, I'm not a billionaire, but I do believe it's possible to have enough money. A great legacy and reputation, however, are priceless."

Tuesday's vote in the Virginia Senate will certainly provide more clarity on the situation, and it seems that vote will go against the wishes of Ted Leonsis, Monumental Sports, and Governor Youngkin. If it does, it may force the two Virginia political parties to work together for solutions to a number of problems for the people in Virginia. If the Governor and his Republican colleagues start finger-pointing and blame-gaming the Democrats for stopping this arena deal, Leonsis may be forced to accept DC's offer of remaining in Capital One Center or he'll likely have to fund the land purchase and arena construction in Alexandria himself.

It isn't often I applaud politicians for anything, but if the Democrats are usng the fiscal responsibility card to force Leonsis to pay for a shiny, new arena on his own, they deserve some kudos for the effort. For one monent in time, there won't be politicians donating public funds to keep a billionaire's business in town, and we need more of this kind of thinking in public office.

Until next time, keep your sticks on the ice!

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