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Provo council authorizes up to $20M in revenue bonds, appropriates $20M for airport terminal expansion
Summary
Council authorized up to $20 million in transportation sales‑tax revenue bonds to bridge funding for the Provo Airport terminal expansion and appropriated the funds to allow the project to proceed; officials said the bonds are revenue bonds (not general‑obligation) backed by a designated county option sales tax and airport revenues and would not raise city property taxes.
The Provo City Council unanimously approved authorization to issue up to $20,000,000 in transportation sales‑tax revenue bonds and then appropriated $20,000,000 in the airport fund to enable construction of the airport terminal expansion.
Airport Director Brian Torgerson described the phased expansion, including apron work completed earlier and phase‑2 construction starting imminently; the bonds were described as bridge financing to bring forward funds that will otherwise be received incrementally over several years from FAA and other sources. Torgerson said the project will expand ticketing, baggage handling and gate capacity and move to a two‑level terminal layout with additional concessions and boarding bridges.
Administrative Services Director Daniel Follett outlined bond parameters: principal not to exceed $20M, final maturity no more than 16 years, an interest rate cap of 6%, and a maximum discount from par of 2%. He emphasized these are revenue bonds repaid from the quarter‑cent transportation sales tax and airport revenues and are not general‑obligation bonds; the local sales tax rate would not increase as a result. Bond counsel was present to answer technical questions.
Council took public comment (support from residents familiar with the airport) and then approved the bond authorization and the appropriation by unanimous votes. Staff said the administration intends to use passenger facility charges and sales‑tax revenue to pay the bonds down, with a target to retire the bonds in as few as eight years based on projected revenues.
