[Congressional Record Volume 144, Number 96 (Friday, July 17, 1998)]
[Extensions of Remarks]
[Page E1329]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 INTRODUCTION OF A BILL TO AMEND THE D.C. CONVENTION CENTER AND SPORTS 
                    ARENA AUTHORIZATION ACT OF 1995

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                       HON. ELEANOR HOLMES NORTON

                      of the district of columbia

                    in the house of representatives

                        Thursday, July 16, 1998

  Ms. NORTON. Mr. Speaker, today, I introduce a bill to amend the D.C. 
Convention Center and Sports Arena Authorization Act of 1995 in order 
to enable the Washington Convention Center Authority (Authority) to 
finance revenue bonds for the cost of constructing a new convention 
center in downtown D.C. This legislation moves forward the hope and 
promise of the 1995 legislation for a sports arena and a convention 
center, twin centerpieces of economic development and jobs in the city 
and revitalization of downtown in the District. The quick and efficient 
construction of the MCI Center and the new jobs and revenue the arena 
has brought to D.C. residents have encouraged the city to complete its 
work on a convention center, where the need has long been conceded.
  In every other city in the United States, this matter would not come 
before any but the local city council. Unfortunately, unlike every 
other city, the District does not have legislative and budget autonomy 
and therefore cannot spend its own funds unless authorized by Congress.
  Extensive hearings in the City Council have been held on the 
underlying issues, with an informed and vigorous debate by members of 
the City Council. On June 16, the City Council approved legislation to 
finance the new convention center, and on July 7, the City Council 
passed a bond inducement resolution to approve the Authority's proposal 
for the issuance of dedicated tax revenue bonds to finance construction 
of the convention center. On July 13, the D.C. Financial Responsibility 
and Management Assistance Authority (Control Board) gave its final 
approval to the financing plan for the project, leaving only 
congressional authorization, which is necessary for the District to 
proceed to the bond market.
  On July 15, the Subcommittee on the District of Columbia heard 
testimony from Mayor Marion Barry, City Council Chair Linda Cropp, City 
Council Member Charlene Drew Jarvis, Control Board Chair Andrew 
Brimmer, Authority President Terry Golden, and representatives of the 
General Accounting Office (GAO) and the General Services Administration 
(GSA) on the financial aspects of the project. After hearing this 
testimony, I am satisfied that the Authority is ready to proceed with 
the issuance of bonds to secure financing, allowing the Authority to 
begin to break ground possibly as early as September. Considering the 
many years delay and the millions in lost revenue to the District, 
ground breaking cannot come too soon.
  Although the GAO testified that the cost of constructing the new 
convention center would be $708 million, $58 million more than the $650 
million estimate, the $58 million is not attributable to the cost of 
the center but to certain costs that should be borne by entities other 
than the Authority. For example, vendors who will operate in the 
facility are anticipated to contribute $17.7 million in equipment 
costs; the District government will provide $10 million for utility 
relocation from expected Department of Housing and Urban Development 
grants; and the President has requested $25 million in his budget to 
expand the Mount Vernon Square Metro station.
  The GSA testified that the agency had worked closely with the 
Authority to keep the costs of the project down. With the GSA's 
assistance, the Authority secured a contract with a construction 
manager for a ``Guaranteed Maximum Price,'' whereby the private 
contractor is given incentives to keep costs down and assumes the risk 
for any cost overruns.
  Mayor Marion Barry testified, among other things, regarding the 
promise of additional jobs for District residents. He said that the new 
convention center would create nearly 1,000 new construction jobs, and 
that once the facility is completed, it would generate nearly 10,000 
jobs in the hospitality and tourism industries. He testified that, 
using some of the approaches that were successful with the MCI Center, 
special training, and goals for jobs for D.C. residents would be met.
  The District of Columbia Subcommittee hearing was not a reprise of 
the lengthy D.C. City Council hearings, and, on home rule grounds, did 
not attempt to repeat issues of local concern. However, since the 
issues of financing and bonding before the Congress implicate other 
areas, the Subcommittee asked extensive questions and received 
testimony concerning many issues, including location, size, and job 
creation, in addition to the strictly financial issues.
  This convention center has an unusual financial base, which I believe 
other cities might do well to emulate. The financing arises from a 
proposal by the hotel and restaurant industry for taxes on their own 
industry that would not have been available to the city for any other 
purposes. The proposal was made at a time when the city's need for 
revenue and jobs has been especially pressing. For many years, the 
District had been unable to attract large conventions. Not only has the 
District lost billions as a result; the local hotel and restaurant 
industry has suffered from the absence of a large convention center. It 
is estimated that the inadequacy of the current facility led to the 
loss of $300 million in revenue from lost conventions in 1997 alone. My 
legislation will enable the District to compete for its market share in 
the convention industry for the first time in many years.
  The delay in building an adequate convention center has been very 
costly to the District. In a town dominated by tax exempt property, 
especially government buildings, a convention center is one of the few 
projects that can bring significant revenues. To that end, the District 
intends to break ground this September. I ask for expeditious passage 
of this bill.

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