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Marion council approves amendment to STAR bond master developer agreement; staff signals possible $100M bond authorization ahead
Summary
The council approved technical amendments to the STAR bond master developer agreement to clarify project-one build obligations, add certain sales-tax categories to the revenue structure and recognize development entities; staff said authorization to issue STAR bonds in the $100–110 million range may be proposed at a future meeting.
Marion’s City Council approved an amendment to the STAR bond district master developer agreement that staff described as technical but necessary to align the agreement with bond documents and identify project participants.
Cody, presenting the amendment, said the changes do three things: restate that the developer must build project one as presented; confirm that hotel, motor fuel and amusement taxes can be revenue categories for STAR bond repayment if those uses appear in the district in future; and list additional development entities in assignment/assumption documents. "This amendment does three things," Cody told the council, summarizing the clarification on build-out obligations and the updated assignment language.
Councilors asked how the amendment affected pledged revenues for the first series of bonds. Cody said the first series will primarily rely on municipal sales tax and the city’s home sales tax share and that other taxes will still be collected but not pledged to repay the first series; funds would sit in a STAR bond account and could be used to reimburse eligible project costs or to secure future bond series.
Council members heard that staff hopes to bring an authorization to issue STAR bonds at the next meeting; bond counsel and staff estimated the first series could be in the $100–110 million range to build project one. The council approved ordinance 3998 by roll call.
The amendment updates the 2020 master developer agreement to reflect parties and revenue categories the city and bond counsel now expect to be relevant. Staff said the changes do not create new taxes but clarify which existing or future tax streams may be used to repay bonds if those revenue sources exist within the STAR bond district.
