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Committee forwards EDA request to borrow $14.7M for Diamond District parcel purchase
Summary
The committee voted to forward an ordinance to transfer $14.7 million from contingency to support an EDA short‑term loan to complete a $25 million purchase of a Sportsbacker parcel; council members questioned whether contingency rules and a 10‑year repayment schedule comply with city ordinance.
The Finance and Economic Development Standing Committee voted to forward Ordinance 20 26 041 to full council with a recommendation to approve. The ordinance amends the FY26 general fund by transferring $14,700,000 from the contingency reserve to create a line item supporting the Economic Development Authority’s (EDA) redevelopment of the Diamond District.
Sharon Ebert, deputy chief administrative officer for planning and economic development speaking for the EDA, described the 67‑acre Diamond District project and said the city must purchase a roughly 6.6‑acre Sportsbacker Stadium parcel from Virginia Commonwealth University for $25,000,000 so public infrastructure and phase‑1 development can continue. Ebert said the EDA has $11,000,000 in its account and is requesting the EDA borrow $14,700,000 as a short‑term, 10‑year loan; the expectation is the loan would be repaid when subsequent parcel sales occur.
Council member Gibson questioned whether the contingency reserve — which city ordinance says should be used for catastrophic, unforeseen, or unavoidable events — is an appropriate funding source given the gap was known during earlier negotiations, and observed that a 10‑year payback differs from a possibly shorter requirement she recalled. Finance Director Leticia Shelton reported the current contingency balance at $29,000,000 and an unaudited balance of $34,000,000; administration representatives repeated that alternatives were considered but the interim borrowing approach is a pragmatic option to avoid higher transaction costs for the EDA.
The committee moved and approved forwarding the ordinance by voice vote (Vice Chair Jones and Chair Robertson recorded as 'Aye'). The committee also asked for additional detail from Davenport and staff about the contingency balance, payback timeline, and alternatives before full council action.
Next steps: staff will provide additional financial detail to the committee and Davenport will supply a breakout of upcoming debt service.
