Mayor Sharon Pratt Kelly's

proposal to create a special

authority to issue tax-exempt revue

bonds to finance a $450 million

convention center in the Districtf

Columbia is moving toward final

passage by the district council.

The council on July 5 gave

preliminary approval to a bill th provides

for financing the debt service wi

dedicated taxes raised from

increased surcharges on hotels an

restaurants. The council added an escalator mechanism to increase t

levies if revenue shortfalls occu but

restaurants would be exempt.

The council is scheduled to vot

July 19 on final passage. On theme

timetable is legislation to make

permanent an income-based "public safety" tax on businesses and

institutions to help finance consuction of

a proposed $150 million, 21,000-st

sports arena in the district.

The one-time levy, enacted to

balance the fiscal 1994 budget, n

applies to nonprofit organizationthat

would be exempt from the

permanent tax. Revenues are projeed to

be $34 million in fiscal 1995, whh

begins Oct. 1.

The district projects $9 millioin

annual debt service on the propos

arena, which would house both the Capitals hockey team and the Bulls

basketball team now based at the

USAir Arena in Landover, Md.

The teams' owner, Abe Pollin,

signed a 30-day memorandum of

understanding with the district tt

expires July 31 to lay the groundrk

for a binding contract.

The council will discuss financg

and other issues at a July 15 heang.

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