RICHMOND, Va. — Three months after Glenn Youngkin stood beside leaders from Monumental Sports and announced a proposal to build a $2 billion entertainment complex to house the Washington Wizards and Capitals in Alexandria, the Virginia governor has been dealt a major setback to his plans.
On Thursday, legislators negotiating the commonwealth's budget in Richmond made it known that the sports arena bill would not be included in the budget. The blow comes just two days before the legislative session concludes on Saturday.
"I believe that the Senate is about to make a colossal mistake," Youngkin said in a speech outside the statehouse. "The Senate refused to give the single largest development deal any serious or meaningful consideration. The way the Senate has handled this opportunity I fear damages Virginia's business environment. It's a clear signal that opportunities to welcome new investments and jobs even ones of historic magnitude will not be evaluated on their merit but instead will be viewed in partisan interest."
The governor had believed the projects was one of the biggest economic opportunities for the state.
Moving forward, Youngkin seems to be leaving the decision up to lawmakers to "embrace the opportunity," even though he has options to advance the project. For now, the governor doesn't have plans to amend nor call for a special session.
HB 1514, the Virginia Sports and Entertainment Authority and Financing Fund, was introduced by Del. Luke Torian, and passed through the House of Delegates. However, similar legislation was killed in the Senate. The bill proposed creating a sports authority that would issue more than a billion dollars in bonds to build a sports and entertainment district for the Washington Wizards and Capitals near the Potomac Yard Metro station. Monumental, the teams' parent company, would have to repay the loan from the revenue it generates. But based on the nature of the bonds used to finance the proposal, if Monumental was unable to pay it back, the full loan would fall to taxpayers. Monumental has said that scenario was extremely unlikely.
"Everyone wants to make the arena the story -- that is not the story for this budget," Torian (D-Prince William Co.) said. "The story for the budget is we're getting it out on time to address the critical needs of the Commonwealth of Virginia."
Sen. Louise Lucas (D-Chesapeake City), the project's most vocal opponent and the chairman of the Senate Finance and Appropriations Committee, could be seen smiling Thursday as she watched Youngkin speak from the top of the Virginia State Capitol stairs. Lucas was most worried about the use of bonds in the funding.
"We were able to save taxpayers a ton of money by not putting our full faith on the project," Lucas said. "They don't like the idea that I would not allow it to be heard but when I feel strongly enough about it, of course I will do just with this arena."
Killing the bill could mean jeopardizing bills Democrats want signed by the governor.
"When you're staying strong against something that the governor wants you know you'll lose something," Lucas acknowledged. "I anticipate that, but he's here for two years, I'm here for four."
Del. Mark Sickles (D-Fairfax) said he hopes the governor will learn to work with the legislature from here on out.
"It would not be smart for him to irritate the legislature that does not have his energy for this project," Sickles said.
Sickles added that while he could see the economic benefits of the arena, the lack of wide-range support from the community -- including transportation advocates and labor unions -- posed a big problem, on top of the lack of support from a major player on the finance committee.
"I never felt there was room for negotiation with the Senate because of Senator Lucas’ strong opposition," he said.
Following the announcement that the Virginia legislature was unlikely to fund Youngkin's proposal, D.C. leaders once again made their interest in keeping the teams in the District known.
“The Arena and Monumental Sports have been partners with the District for almost 30 years, and a great asset to downtown,” DC Council Chairman Phil Mendelson said. “As a deal in Virginia remains uncertain, the Council continues to be ready to welcome Monumental Sports’ change of mind."
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