Redskins, D.C. reach deal on new stadium

December 08, 1992|By Vito Stellino | Vito Stellino,Staff Writer

The Washington Redskins and the District of Columbia have reached a 90-year agreement for the Redskins to build a 78,600-seat Jack Kent Cooke Stadium adjacent to RFK Stadium, club and city officials announced last night.

The announcement came less than five months after team owner Jack Kent Cooke hammered out a deal with Virginia Gov. L. Douglas Wilder to build a stadium at Potomac Yard in Alexandria, Va.

That deal collapsed because of opposition in Virginia, and Cooke then resumed talks with Washington officials.

In contrast to the Potomac Yard announcement -- at a news conference on the Virginia site, attended by NFL commissioner Paul Tagliabue -- this stadium deal was announced in a 2 1/2 -page news release issued by the club last night.

The release did not state the price of the stadium, but Cooke said last week it would cost $160 million. That would make the total cost of the project $206 million, because the deal announced last night includes $46 million in infrastructure improvement related to the stadium.

Cooke would finance the building of the stadium and would receive all revenue from operating the stadium and the parking lots. That means Cooke would be able to keep all of the club-seat and luxury-box revenue at the stadium.

The Redskins would lease the stadium site for 30 years at $1 per year, and then turn over the stadium to the city. The Redskins would be given 12 five-year options to rent the stadium, ranging from $2 million a year for years 31 to 40 of the agreement to $3.5 million a year in years 81 to 90.

This is assuming a 90-year stadium life, which is longer than most stadiums are in operation.

According to the agreement, the city would issue bonds to finance the $46 million in infrastructure improvements. The Redskins would pay $4.6 million a year to finance the bonds.

The $4.6 million would be produced by a 6 percent admissions tax on tickets, a 9 percent sales tax on concessions, a 12 percent sales tax on parking, a corporate income tax of 10.5 percent and a property tax of $2 million.

If those taxes fail to produce $4.6 million, the Redskins would make up the difference.

There's also a cap of $4.6 million on the revenue the city gets from those taxes or a total of $138 million for the duration of the 30-year period when the Redskins will own the stadium.

In the final 60 years of the deal, after the District gets the stadium, the city would continue to collect the same taxes that went to finance the bonds in the first 30 years of the deal, but

there isn't a $4.6 million cap. That means the Redskins are committing themselves to a $2 million property tax payments for 90 years, plus the other taxes.

The deal also says the Redskins will attempt to get 35 percent minority participation in the building of the stadium and that 51 percent of the construction jobs will be held by D.C. residents.

The stadium is expected to resemble Giants Stadium in the Meadowlands.

The announcement did not say when groundbreaking would take place or when the stadium would be completed. Cooke had announced he planned to open the Potomac Yard Stadium by 1994, but 1995 now seems like a likely target date.

There was no mention in the announcement of whether RFK Stadium would be torn down. There had been speculation that it would be demolished as part of the deal.

The terms of the agreement will be formalized in a memorandum of understanding that is to be signed shortly and then made public.

When Cooke had talks with the District before he made the Virginia deal, the infrastructure costs were estimated at $60 million because it would have been necessary to make improvements to federal land -- the site of the Langston public golf course and a proposed children's educational park.

By moving the site closer to the RFK, it was possible to cut $14 million from the cost of improvements. The environmental hurdles also aren't expected to be as daunting.

In the announcement, Mayor Sharon Pratt Kelly, who called Cooke a "billionaire bully" when he made the deal to build the Virginia stadium, said: "I am simply delighted that Mr. Cooke has decided to build his stadium in D.C.

"This means jobs, work and money to the citizens of the District. Over the years, the new stadium will bring in additional revenue to us. . . . This is fabulous news for Redskins fans and the citizens of D.C."

Reflecting their strained relationship was the fact that Cooke's comments didn't mention the mayor.

"I am glad we wound up where I wanted to be in the first place," Cooke said. "The Redskins' new home will the finest, state-of-the-art football stadium. The masterly job of of conveying and creating goodwill in which this agreement was reached (we met but twice) can be attributed to the efforts of [stadium negotiator] Clifford Alexander and [D.C. Council chairman] John Wilson."

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