Pollin Nearly Got Tax-Free Bond Deal

Article excerpt

MCI Center owner Abe Pollin scored another near miss recently with a well-hidden provision in a Senate bill that would have allowed him to refinance his arena with up to $200 million in tax-exempt bonds.

The tax break was buried without mention in a Senate amendment to legislation repealing the estate and gift tax.

The estate-tax repeal is headed to the White House, but on July 13 the amendment that would have benefited Mr. Pollin failed to overcome a budget point of order raised by Sen. Charles S. Robb, Virginia Democrat.

The amendment gained 57 votes, short of the 60 votes needed to overcome a budget point of order.

"The MCI Center has been an enormous asset to the city, and vital to its revitalization," said spokesman Dan Gerstein, explaining support for the proposal from his boss, Sen. Joseph Lieberman.

"[But] unless there is some relief for Mr. Pollin, there could be [a threat] to the long-term viability of that asset," Mr. Gerstein said. Mr. Pollin, who also owns the Washington Wizards and Mystics basketball teams, has said that he is currently operating "in the negative," and that refinancing would put him "close to positive."

Mr. Lieberman and Sen. Rick Santorum, Pennsylvania Republican, sponsored the underlying amendment, which included a host of broad-based "community renewal" tax incentives. They both also support the tax breaks for Mr. Pollin, said several sources familiar with the bill.

Calls for comment to the offices of Mr. Santorum and Mr. Pollin were not returned. Staff for the Carmen Group, lobbying on behalf of Mr. Pollin, would not speak on the record.

The provision was one of 59 in the Santorum/Lieberman amendment and titled, "Rules Regarding Qualified Issues." A quick read of the section leaves no doubt as to who was intended to benefit.

"The term `qualified facility' means an enclosed, mixed-use entertainment, conference, and sports complex located in the District of Columbia Enterprise Zone, which held its first professional sports event on December 2, 1997," reads the amendment as printed in the Congressional Record.

The provision is not included in community renewal legislation to which the White House and House Speaker J. Dennis Hastert, Illinois Republican, agreed. Nor is it in an alternative sponsored by Senate Democrats and written by Mr. Robb.

Nonetheless, opponents of the provision think it may only be a question of time before Mr. Pollin succeeds, in part because of his persistence, in part because of his political clout. …