New ballpark mediation is under way

MLB and D.C. enter mediation over ballpark

SCOTTSDALE, Ariz. -- Mediation has begun between Major League Baseball and the District of Columbia regarding construction of a downtown ballpark for the Washington Nationals, MLB's No. 2 official said on Wednesday night.

"The process has started," said Bob DuPuy, MLB's president and chief operating officer. "We're required not to comment on the substance of it by contract."

The step was necessitated because the D.C. City Council failed to meet a contractual end-of-the-year deadline to sign a lease with MLB, plus secure a site and financing for the ballpark, which was originally pegged at $535 million. Mediation prefaces full-blown arbitration to resolve the matter.

Former Detroit Mayor Dennis Archer was chosen as mediator for the meetings, which are running concurrently with negotiations between the parties to try to resolve the issue at the City Council level.

"We're working closely with the Mayor and the City Council," DuPuy said after making a full report on the subject at Wednesday's executive council session that concluded the first day of owners' meetings here this week. "Hopefully, all of that will bear fruit and we won't have to go to arbitration. We'll be back in Washington by the end of the week."

MLB began the legal process after District of Columbia Mayor Anthony A. Williams pulled an item set for the City Council's final meeting of the year last month that called for a vote on the terms of a 30-year lease, which would have precipitated the selling of bonds to pay for at least part of the project.

Williams reportedly pulled the agenda item because he didn't have the seven votes among the 13 councilmembers to pass it. Since then, City Council chair Linda Cropp sent a letter to MLB seeking a number of changes in the lease agreement hammered out last year. Cropp said she could ensure the necessary positive votes if the changes, including MLB paying all cost overruns on the stadium construction, were made.

Cropp said in the letter that she could place the matter on the agenda for a vote by as early as Feb. 7.

DuPuy, though, said that "we have not reacted to that letter and it's a matter of ongoing discussions. Everyone is trying to get this done. We're working very hard to have baseball succeed in Washington, D.C."

A positive Council vote is essential because the city needs to sell $289 million worth of public bonds to help fund the project. The remaining cost will be covered by a bank loan. The new ballpark on the banks of the Anacostia River just south of the Capitol was supposed to be in operation by 2008. Meanwhile, the Nationals are getting ready to play their second season in aging RFK Stadium, where they drew 2.7 million fans and netted a $10 million profit this past season.

MLB elected to move the Expos from Montreal to Washington in December 2004 only after it was given written assurance by the Council that the stadium would be built. That assurance came at the 11th hour with Cropp casting the deciding vote. She had blocked the project only two weeks earlier.

To keep the deal moving forward last month, MLB agreed to pay $20 million in cost overruns and set aside $24 million to cover rent payments in case of a terrorist attack.

DuPuy has pointed out that MLB has no control of the project in the design, development or construction phases and shouldn't be further responsible for cost overruns that are being generated in Washington without MLB approval.

Barry M. Bloom is a national reporter for MLB.com. This story was not subject to the approval of Major League Baseball or its clubs.