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Commission approves STAR bond ordinance to finance Sports of the World Phase 2
Summary
The Garden City Commission approved an ordinance authorizing up to $49.7 million in STAR bond financing to fund eligible project costs for Sports of the World Phase 2; bonds are special obligations payable solely from incremental sales tax revenues and require state and attorney general approvals before closing.
The Garden City City Commission voted Sept. 16 to approve an ordinance authorizing the issuance of STAR (sales tax revenue) bonds to finance Phase 2 of the Sports of the World project.
The ordinance, if finalized through required state approvals, authorizes STAR bonds in a principal amount not to exceed $49,715,000 to finance up to $45,126,189 in eligible project costs plus issuance costs. Mary Carson, bond counsel with Spencer Fane, explained the structure and the limitations of the financing during a pre-pricing discussion that was included in the commission packet.
The nut graf: the bonds are special obligations payable only from incremental sales tax revenues collected in the Star Bond District; they are not general obligation debt of the city and do not obligate the city or state to levy taxes for repayment. The commission was told the bonds will be issued as three term maturities (2029, 2033 and 2039) and are subject to mandatory redemptions beginning June 1, 2026, if surplus incremental sales tax revenues are available.
Under the presentation, the bonds will be privately placed and were marketed during an order period Sept. 9. Michael Lambert of Cruz and Associates provided a post‑pricing recap showing robust investor interest and an oversubscription during the order period. Lambert said proceeds will cover project disbursements to the developer, capitalized interest to cover the first interest payment, a reserve fund sized at six months of interest, and issuance costs.
City staff and bond counsel noted the issuance remains subject to final approvals by the Kansas Secretary of Commerce and to approval of the bond transcript by the Kansas attorney general; the anticipated closing date presented to the commission was Sept. 30, 2025. The commission voted to approve the ordinance at the meeting.
Discussion points included commission appreciation for the transaction and optimism that increased district activity could accelerate principal prepayments. Commissioner Manny Ortiz commented that new development and traffic could speed payoff, while underwriters cautioned the commission that their base case assumes sales tax collections roughly equal the prior 12 months and included stress tests to show payoff under different scenarios.
The commission’s approval allows the city to finalize bond documents and proceed with closing subject to the state and attorney general reviews.
