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D.C. Chamber heckles plan to finance baseball stadium

By Dore Carroll
Washington Business Journal
Updated: 7:00 p.m. ET Oct. 31, 2004

D.C. Chamber of Commerce President Barbara Lang is proposing changes to the District's baseball stadium plan to ensure small businesses are not unfairly burdened by the tax financing.

Lang says she will withhold her group's full endorsement of a stadium tax because, as pitched by Mayor Tony Williams, the plan would impose too great a burden on small businesses.

While the chamber "enthusiastically supports bringing baseball back to the city," small businesses oppose the graduated gross receipts tax that would be imposed on 2,000 District businesses that generate more than $3 million in annual revenue.

Lang, attempting to balance the interests of chamber members large and small, has a modified plan of her own to pitch to the mayor.

For starters, the chamber is expected to propose changes that would limit business contributions to four years, a far cry from the mayor's 30-year plan.

"This becomes a regressive tax; that is our objection to this proposal," Lang says. "We realize there are some economic benefits and civic pride to having a baseball team. But we want to make sure our businesses are being treated fairly."

The chamber proposal would levy a local business tax to provide "seed money" to finance the $440 million stadium for a term of up to four years, with the remaining 25-plus years of bond repayments coming from the city's general fund.

"The business community already puts over $800 million into the general fund" to support education and community needs, Lang says.

Under Williams' proposal, businesses would pay an estimated $24 million a year to help finance the stadium. The proposed tax would be capped at $28,200 for business with gross receipts of more than $16 million.

A majority of D.C. chamber members informally surveyed support the baseball tax, Lang says. So does the leadership of the 1,300-member Greater Washington Board of Trade, which has endorsed the stadium plan.

"Our members see baseball as an economic engine for the city and the entire region," says Board of Trade lobbyist Len Foxwell. "We see it as a catalyst for a renaissance of the Anacostia waterfront. It will finally create the kind of world-class waterfront destination that is the hallmark of great cities around the world, and that our residents truly deserve."

Foxwell notes that only 11 percent of the district's highest grossing businesses will be taxed. "The mom-and-pop stores, for the most part, will be spared this obligation," he says.

Mid-size companies, however, may feel the biggest pinch, Lang says.

The D.C. Chamber plans to counter that by presenting proposed amendments to council members Nov. 1. A full council vote could come as early as Nov. 9.

In addition to the four-year time limit, one option the chamber will suggest to alleviate the tax burden on smaller companies is a reduction of the city's franchise tax. Lang also will lobby to mandate that participation by local, small, disadvantaged business enterprise companies comprises at least 50 percent of city projects, not the usual 35 percent.

"Small businesses are the heart and soul of this city; they're doing most of the hiring," Lang says. "We've got to figure out how to make this work for them."