Managing General Partner, D.C. United
Hearing on the Soccer Stadium Development Act of 2014
Council of the District of Columbia
June 26, 2014
Good morning Chairman Mendelson and Members of the Council. My name is Jason Levien, and I am the Managing General Partner of D.C. United. I am here not just to express my support for the Soccer Stadium Development Act, but also to express my commitment to ensuring that DC United and its future stadium generate real and enduring benefits for the people of the District.
In 1995, construction crews broke ground on a new sports and entertainment arena in the District’s Gallery Place neighborhood. At the time, empty lots and vacant buildings were among the neighborhood’s most dominant features. Today, Gallery Place is bustling with activity and the Verizon Center is a model for urban economic development.
Modeled after the highly-successful Verizon Center agreement, the District will be responsible for horizontal development of the soccer stadium and DC United will be responsible for vertical development. In addition, the District’s financial obligation is capped at $150 million, while its projected costs are expected to be no more than $120 million. There are three particular aspects of this agreement that bear emphasizing. First, just like the Verizon Center agreement, all construction costs for the stadium will be privately funded. This will allow the District to keep its financial risk to a minimum while bolstering its tax base. Second, DC United will invest $150 million in stadium construction and D.C. United – not the District – will be responsible for all overages on stadium construction and land preparation. Third, the District will not incur any new debt, and the project will not result in any new taxes on District residents or businesses.
Meanwhile, the agreement will generate substantial economic benefits for the District. Specifically, the stadium itself will generate $50 million per year in new economic activity and the entire agreement will generate over $2.3 billion of new economic activity. The stadium will create 1,559 jobs, including 452 permanent jobs. Importantly, District residents will have first priority for these jobs.
The fiscal impact of this deal also is staggering: over the next 30 years, the stadium will generate $204 million net present value in new tax revenue for the District. This exceeds the $120 million that the District will expend in project costs. And this is tax revenue that the District would have never realized since the land that the District will assemble for the project is currently generating very little revenue and no economic development. This previously-unrealized tax revenue can be used to fund critical District initiatives, including hiring teachers; renovating District schools; putting more police, fire, and emergency medical workers on the streets; and rebuilding aging infrastructure.
In addition, the District will own the land during the term of DC United’s lease and will retain ownership of both the stadium and the land at the end of the lease. Assuming conservative land values and appreciation, the stadium site likely will be worth more than $700 million at the end of the lease, and significantly more if private development occurs around the stadium site.
Finally, the stadium will serve as another important cultural and entertainment landmark for the District, hosting over 50 events a year, including concerts, cultural events, and school-age sports.
By any measure, this project is a sound economic investment for the District. But this project is about more than just economics: it is an opportunity to build on the tremendous partnership between D.C. United and the District. D.C. United is home to one of the most passionate and fervent fan bases in the country. Each game brings together a diverse collection of thousands of District residents – many of whom spend each match jumping up and down with our supporters. This stadium will enable D.C. United to further capitalize on the popularity of soccer in the District, which was most recently evidenced by the fact that the District is the number one television market in the United States for the World Cup.
Beyond serving as a source of entertainment and pride for the District, D.C. United serves the community through its stellar record of community service work, which in 2013 included partnering with 50 local groups, contributing hundreds of hours of volunteer work, bringing thousands of disadvantaged youths to D.C. United games, running an afterschool program for thousands of children, and donating thousands of books to DC schools.
For these and other reasons, the stadium project has garnered broad and diverse support across the District, including from a coalition of over 70 organizations and District residents from all wards who have sent over 70,000 emails communicating their support to the Mayor and the Council. This support is growing every day.
Thank you again for allowing me to testify today. I look forward to answering questions from members of the Council.