Why has the City chosen to pursue a revenue bond to purchase the SportsPlex?
City staff is recommending use of a revenue bond for two reasons: 1. To avoid using the tax based general obligation bond which would have an impact on taxpayers. 2. Existing programs at the SportsPlex, as well as the potential for new activities offered by the Parks and Recreation Department, are projected to bring in enough revenue to offset debt service/loan and operating expenses. A financial feasibility study was conducted by Crowe-Horwath, a financial consulting firm. The revenue estimates in that study were conservative. Revenue projections in the study assume 27% less income than revenues collected at the SportsPlex in 2008. Expenses were estimated higher than current expenses at the SportsPlex. City staff feels confident that sufficient revenue will be generated in order to cover expenses including debt service. The City has previous experience with revenue bonds as a type of financing. A revenue bond was used to construct the new nine holes at Cascades Golf Course in 1999. Th
