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DC United, District reach final term on stadium deal

The stadium is expected to open for the 2018 MLS season

Jonathan O' Connell/TWP | 6/9/2015, 11:02 a.m.
DC United, District reach final term on stadium deal
El Consejo del Distrito y DC United aprobaron los términos finales para el nuevo estadio en Washington, DC. | Archivo ETL

District Mayor Muriel E. Bowser and D.C. United’s owners have finalized a stadium development deal to keep the team in D.C. provided that the District government secures the needed land by Sept. 30, according to multiple officials involved in negotiations.

Bowser (D) is expected to announce the deal formally at a Tuesday press conference, the officials said, likely ending the team’s contemplation of a move to Virginia.

Bowser tweeted the news shortly before 6 p.m. Monday and issued a press release saying the agreement would “add vibrancy to a neighborhood on the banks of the Anacostia River and generate jobs for District residents.”

Jason Levien, the team’s managing partner, said in the release that the agreement marked “a significant step forward for D.C. United and the District of Columbia.”

After the team’s discussions with Virginia Gov. Terry McAuliffe (D) and Loudoun County officials became public last week, the mayor’s office hastened negotiations with the team.

“We go after every deal. Some work out, some don’t,” said McAuliffe spokesman Brian Coy. “The governor believes if there are jobs to create, investment to bring back to Virginia, you can’t win unless you’re on the field.”

The basic deal, first negotiated by former mayor Vincent C. Gray and approved by the D.C. Council late last year, remains in place. The District would pay $150 million to acquire and prepare land on Buzzard Point in Southwest Washington. D.C. United would then privately finance a stadium of around 20,000 seats.

The project is expected to cost around $286.7 million and is expected to open for the 2018 Major League Soccer season.

Recent discussions have revolved around financial protections that members of Bowser’s economic team had added to the deal, some of which caused the team’s ownership to balk, according to one of the officials.

The officials shared details of the agreement on the condition of anonymity because the discussions were meant to be private.

D.C. officials asked the team to foot part of the bill for cost overruns, for instance, and provide collateral in case D.C. acquired the land but United failed to build the stadium.

In recent days, according to two individuals involved in negotiations, D.C. and the team agreed to split up to $20 million in cost overruns for acquiring land through eminent domain.

D.C. would still be on the hook for overruns beyond that, but one senior D.C. official involved in the negotiations said he viewed that possibility as “extremely unlikely.”

District officials had also asked that the team put $25 million in an escrow account that the city could take in case United failed to build the stadium, one source said. Ultimately, the two sides agreed to an escrow of $5 million.

United officials in turn agreed to sign a non-relocation agreement, three sources said, preventing them from moving the team to Virginia or elsewhere, provided that by Sept. 30 Bowser’s office gets D.C. Council approval to close the necessary streets, acquire the needed land and, if need be, file for eminent domain.