Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Amphitheater Financing topic
No spam. Unsubscribe anytime.
Bond counsel outlines lease-financing steps, pledge ordinance and expected savings for Columbia City amphitheater
Summary
Lisa Lee, bond counsel with Ice Miller, briefed the council on the amphitheater financing: a public hearing was opened, the council was asked to consider Resolution 20 26/25 to approve a final lease agreement, an introductory pledge ordinance (Ordinance 20 26-26) was presented, and counsel estimated about $820,000 in debt-service savings by leasing two city assets during construction.
Lisa Lee, bond counsel with Ice Miller, told the City Of Columbia City council the financing process for the planned amphitheater will proceed through a public hearing and then consideration of a resolution to approve a final lease and authorize execution.
"At your June 23 meeting, you received that, certified taxpayer petition. You also adopted a resolution of need, and you preliminarily approved the lease agreement," Lee said, summarizing earlier steps. She said the council would be asked to consider adoption of Resolution 20 26/25 to approve the final lease agreement and authorize execution; if the council approves that action, counsel will return at the August meeting with more complete bond-financing numbers after the guaranteed maximum price (GMP) is determined.
Lee explained why the project uses a lease/BOT structure and a newly formed Columbia City Building Corporation as the issuer: leasing certain city assets to the building corporation during construction treats those payments as operating costs and avoids capitalized interest on the financing. "The total debt service difference between having capitalized interest and not having capitalized interest is $820,000," she said, and counsel said leasing two unencumbered city assets for 12 to 18 months could capture that savings.
Lee also previewed Ordinance 20 26-26, a pledge ordinance that would allow the city to pledge legally available revenues to support lease rentals and include a property-tax backup if those revenues prove insufficient. She said the municipal adviser (Baker Tilly) must demonstrate expected coverage ratios — generally at least 125 percent — before counsel could give an opinion that the project is not a controlled project subject to petition or referendum.
Lee said lease rental payments during construction are currently estimated around $320,000 per year (about $160,000 semiannually) and full lease rental payments after completion near $640,000 annually; those figures will be adjusted to match actual debt service once the bonds are sold and interest rates and GMP are known. She cautioned that lease financing is a longer process than a traditional bond sale — closer to six months versus about 60 days — and that the council retains the ability to stop the process before bonds are sold.
No final vote on Resolution 20 26/25 or Ordinance 20 26-26 was recorded in the transcript; council action was framed as prospective pending GMP and final financing figures.
