Summary: As of October 1996, the estimated predevelopment costs for most cost categories of the sports arena in the District of Columbia had somewhat changed, but the overall estimated predevelopment costs had increased by a net amount of $617,000, or about one percent, since GAO's last report. (See GAO/AIMD-96-43R, Feb. 1996.) The District had $66.6 million available to fund the project's predevelopment activities and establish a debt service reserve for the arena project. On the basis of estimates as of October 1996, GAO concludes that the District has enough money to pay the predevelopment costs. The bond trustee has made the 1996 debt service payment of nearly $6 million on arena bonds, and the District's projections of arena tax revenues of $9 million annually seem sufficient to redeem the bonds by 2002 as scheduled. Predevelopment activities for the arena are nearing completion. All land has been acquired; however, the final cost of the parcel of land acquired through condemnation proceedings will be determined by the outcome of legal proceedings. The buildings formerly on the site have been demolished, District employees have been relocated, and construction of the Metrorail connection is about 25 percent complete. The arena's construction began in February 1996 and the facility should open in late 1997.
