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Can stadium end Celebrate Virginia’s slump?

COMPLETE COVERAGE: View all related stories and images on the Fredericksburg baseball proposal

Bruce Quinn, right, majority owner of the Hagerstown Suns, meets with Fredericksburg City Council on Monday evening. Also pictured are, from left, City Council member Fred Howe, city treasurer Jim Haney and team attorney John Ferrante.

The extent to which a proposed multipurpose stadium could help turn around the struggling Celebrate Virginia South development was among the many topics discussed at Monday night’s meeting between the Hagerstown Suns and Fredericksburg City Council.

Celebrate Virginia South, a Silver Cos. development, has struggled amid the recent economic recession. Several proposed projects there—including the Kalahari Resorts water park, the National Slavery Museum and the WorldStreet retail complex—have fallen through, while others, including the thriving Wegmans grocery store, have fared well.

(Click here for an archive of stories on the baseball question)

Meanwhile the debt keeps building up on a $25 million bond issued by the Celebrate Virginia South Community Development Authority in 2006 to pay for the roads, sidewalks, utilities and other development infrastructure.

With proceeds dried up from land sales and leases, the Celebrate Virginia land owners, which include Silver Cos. principals and other investors, have not been making their city taxes, CDA assessments and semi-annual bond payments in full.

According to data from the Fredericksburg Treasurer’s Office, the undeveloped land at Celebrate Virginia has about $7.6 million outstanding in overdue CDA assessments, penalties and interest and almost $1 million in city taxes.

The city has begun tax sale proceedings on more than a dozen undeveloped parcels, though no auctions are expected until next year due to the lengthy legal process of moving toward a sale.

Stafford County has also started the process of selling about 229 acres in Celebrate Virginia North to recoup real estate taxes that are more than two years delinquent. The owners of the land could stave off the sale at any time during the tax-sale process by paying the delinquencies.


In the city particularly, Celebrate Virginia is seen as a major source of future tax revenue, so helping to get the development back on track has been among the goals of people who support the baseball proposal.

That proposal calls for the city to build and own a $29.5 million multipurpose stadium that the Suns, a Class A affiliate of the Washington Nationals, would lease for 30 years.

Some people have questioned the impact that the stadium would have on Celebrate Virginia, pointing to studies showing stadiums’ limited economic impact in other communities.

Suns majority owner Bruce Quinn and City Council members both brought up the effect that the stadium could have on Celebrate Virginia during Monday’s meeting.

Quinn noted that the $25 million in infrastructure improvements at Celebrate Virginia are currently going to waste and said the stadium could help put them to use and drive additional development around it.

City Council member Brad Ellis said Fredericksburg needs a project that stimulates Celebrate Virginia but said it must be a good business deal for the city. He pointed out that the project would require a lot of debt relative to its projected income.

It’s unclear exactly how much the stadium would jump-start Celebrate Virginia, but it should be a regional draw that brings in direct and indirect revenues for the city, said Jud Honaker, Silver’s president of commercial development.

He said his company has been working hard to find tourism-related anchor projects to be the first to commit to Celebrate Virginia—such as Kalahari—but deals have been hard to come by. He continues to speak with Kalahari’s owner, but the company has no current plans to build locally.

The 38-acre parcel that was once intended to be home to the National Slavery Museum has been eyed as the best site for the stadium. That site, on which the city has also started the tax-sale process, is in the midst of a drawn-out legal battle.

Local baseball organizers met with representatives of former Virginia Gov. Doug Wilder earlier this year about acquiring the site, but no deal was finalized. The site is attractive both because of its location along Interstate 95 and the fact that it’s not in the CDA district where special assessments are charged on top of city taxes.


The large amounts of overdue CDA assessments at Celebrate Virginia have led some to question the wisdom of creating another special tax district in the area to finance the stadium.

Under the current financing plan, much of the anticipated $1.84 million in annual debt service would come from a new real estate tax of as much as 32 cents per $100 of assessed value on properties in Central Park and Celebrate Virginia South.

Many Council members have expressed opposition to the tax district, however, and Quinn on Monday brought up the possibility of adding a surcharge on tickets that would go toward debt service as an alternative. It’s possible the financing plan could change significantly before the deal would be approved, if it ever is.

A Tuesday public hearing on the stadium question is scheduled in front of City Council.

The proposed tax district at first would not include the undeveloped portions of Celebrate Virginia South that are behind on their city taxes and CDA assessments. Those parcels would be added to the district as they’re sold and developed—at which time they would have to pay CDA assessments, city taxes and the new service district rate.

Others have wondered how marketable the bonds sold to finance the stadium would be unless the city does a general obligation bond issuance that would count toward the debt limit.

Honaker noted that the special tax district for the stadium is composed of millions of square feet of already developed real estate with cash flow from tenants and a variety of owners, which he thinks would ensure that defaults would not occur in the new district.

He said that’s far different than bonds being issued for undeveloped land, such as was done in 2006 when the Celebrate Virginia CDA bonds were sold.


The stadium isn’t the only project in the pipeline that some people think could help turn around the Celebrate Virginia project.

Area transportation officials are working on a plan to add collector–distributor lanes alongside Interstate 95 between the U.S. 17 exit in Stafford and the State Route 3 exit in Fredericksburg. It’s seen as a way to get local traffic off Interstate 95 and keep vehicles from pooling up at the two exits.

It’s possible that a road could be built off the feeder lanes and into Celebrate Virginia South near the Fredericksburg Expo & Conference Center, said Matt Kelly, chairman of the Fredericksburg Area Metropolitan Planning Organization and a member of Fredericksburg City Council.

Kelly has been a vocal proponent of the stadium plan and thinks the road could also jump-start Celebrate Virginia, which he said is crucially important for the city’s future.

Silver officials have long been trying to get a connection off I–95 into Celebrate Virginia and have offered to pay for a ramp from the Virginia Welcome Center into the development. Currently, southbound I–95 travelers drive past Celebrate Virginia before exiting and having to loop through Central Park to get there.

Federal highway officials have not approved plans for the new ramp off I-95, but an entrance into Celebrate Virginia South from the collector–distributor road would be possible, Kelly said. That could allow people to easily access the development from U.S. 17.

Construction of the project, which would require a costly bridge over the Rappahannock River, isn’t going to happen anytime soon. There is no construction funding currently.

The project received $55 million in the state’s transportation budget passed in June. That will allow the Virginia Department of Transportation to design the project, do the federally required environmental work, take the proposed design through a public hearing process and purchase all of the right-of-way needed to build it, said VDOT spokeswoman Kelly Hannon.

Bill Freehling: 540/374-5405