The Colorado Springs Urban Renewal Authority met Wednesday to discuss City for Champions financing - how much sales tax revenue can be raised and how soon money could be on hand to pay for the planning phases of the project.
None of the authority's board members or others in attendance could estimate the initial costs to hire architects, accountants or attorneys to write bond funding proposals.
"We don't have any cash to do this right now," said City Councilman Merv Bennett. "We may need to write an MOU (Memorandum of Understanding) to the city to acquire a loan to pay for expenses before the sales tax (from the City for Champions) starts to come in."
David Nevill, authority chairman said after the meeting he agrees with Bennett, but also said he was not overly concerned about ultimately raising the money needed to pay for expenses.
"It is a function of when we will incur expenses as to when the funds will come in, and right now we don't know when either will occur," he said. "So, we will explore the possibility of an MOU with the city as a backstop."
The Urban Renewal Authority will be the sole entity charged with financing the project thorugh the Regional Tourism Act and dispersing the money to pay project expenses.
The authority is likely to issue revenue-based bonds to raise money to finance at least some portion of the project, said Jim Rees, executive director of the authority. Those bonds, which are based strictly on the revenue from specific projects, would relieve the city and the Urban Renewal Authority of repaying any obligation from the bonds issuance if the project failed and the bonds entered into default, he said.
In December, the Colorado Economic Development Commission awarded the city an estimated $120.5 million over the next 30 years to help finance City for Champions. To receive the state tax increment financing, a percentage of the net new sales tax generated in a specified zone over the next 30 years, the city must break ground on four projects within five years and complete them within 10 years.
Authority members did not vote on any amendments or resolutions regarding the City for Champions on Wednesday. The authority hopes to meet before April 16 to vote on a final resolution to be presented to the state.
Contact Ned Hunter: 636-0275