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Coralville reviews refinancing options, proposes ArenaCo debt write-down
Summary
Financial adviser Timothy Oswald told the Coralville City Council the city can pay preliminary Rec Center loan costs with LOST revenue within a year and outlined refinancing scenarios and policy changes — including a proposed write-down of ArenaCo debt — to strengthen ratings metrics.
Timothy Oswald of Piper Sandler told the Coralville City Council on June 9 that preliminary loan costs for the city's Rec Center could be paid off within a year using local option sales tax (LOST) revenue, and he presented a packet of refinancing scenarios intended to remove adjustable-rate debt and improve the city's standing with ratings agencies.
Oswald reviewed the city's outstanding general obligation debt and illustrated several debt-limit scenarios, describing how different refinancing choices would affect the metrics used by bond raters. He also proposed changes to the city's debt and fund-balance policies to address the impact of a recently enacted property tax law and to reduce risk from adjustable-rate notes.
As part of the presentation, Oswald described a proposed write-down of ArenaCo debt tied to the original arena financing, framing it as one element of a broader approach to strengthen Coralville's fiscal profile. The council did not vote on the proposal during the work session; the presentation was delivered as information for future decisions.
City Administrator Kelly Hayworth said staff will return with hotel revenue projections in July and a revised Purchasing Policy in July or August to follow up on the financing and policy issues raised by Oswald's analysis. The work session opened at 8:09 p.m. and adjourned at 9:35 p.m.
