A City-County Council committee’s vote on whether to allow the city to issue $98 million in bonds to finance a portion
of the $155 million hotel-retail-residential North of South project downtown has been delayed until Feb. 2.
The Economic Development Committee made a few changes to the financing proposal on Tuesday and chose to wait until its next
meeting to vote on the proposal.
City-County Councilor Mike McQuillen, a Republican committee member, said he expects the measure to pass next month and advance
to the full Council for its consideration.
At Tuesday’s meeting, committee members approved capping the interest rate on the bonds at 6.5 percent. The original
rate was set at 8.5 percent.
“They never would have gone to that [high of a] rate,” McQuillen said, “but it made people more comfortable
to cap it.”
Committee members also agreed to give the Council authority to review the city’s involvement in the project, once it
gets started, if there are substantial changes in financing, he said.
Locally based Buckingham Cos. is leading the development, set to be built on 14 acres of land owned by Eli Lilly
and Co.—now home to a parking lot north of South Street between Delaware Street and Virginia Avenue.
The city is offering to provide an $86 million loan and build $9 million in infrastructure to get the project off the ground.
Plans call for a boutique hotel, retail space, a YMCA and 320 upscale apartments.
The price tag includes a $7 million contribution from Buckingham, a $6 million grant from the Indiana Economic Development
Corp., the $29 million in land Lilly is providing, and $18 million for the YMCA branch.
Instead of $86 million, however, the city actually will borrow $98 million to pay for administrative costs related to the
bond sale and for interest payments while the project is under construction.
City officials say the additional $12 million adds flexibility to the bond issue because it’s often impossible to know
how the bond markets will perform between the time of filing and issuing of debt.
The project’s site plans also still need to be approved by the city’s Regional Center Hearing Examiner. Because
the site is within the Regional Center overlay district, its design needs to comply with Regional Center Urban Design guidelines.
A regional center meeting to consider the site plans is scheduled for Feb. 10.
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IBJNews
Vote on North of South project's bond financing delayed
Scott Olson
January 21, 2011
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Laura-the festivals and tastings are free. What does is strengthen the sense of community with activities. What are those empty lots doing for the Village? it's sad you can't see the good that this progress can do for the area. No one is requiring anyone to shop there. I guess you'd rather see a Dollar store move in or no, we'd rather see the property stand empty b/c change is out of the question.
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Read down to the part about Brizzi. Someone needs to subpoena his "purchases" of Red RockPictures and Cellstar and his corresponding bank records, I mean c'mon, I'd like to see his alcohol usage records, too. http://diana-vice.blogspot.com/2011_01_01_archive.html
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Wonder if my neighborhood can advertise our "retention" pond and act like it is a beach too?
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a new record at the '11 salebration until they realized that it was a futile effort to get their crapwagon moter and crapwagon car up speed. And then they just quietly slunk off into the night and never spoke of it again. Nothing to see here folks.
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millions for putting a company's bumper sticker on one of its Lolas. But you gotta take what you can get.
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They are getting $6 mil grant money, $9 mil for infrastructure (ok, this you can argue city would have to do anyway), $XX mil for interest payments (or is the city getting reimbursed for that?), and taxpayers get pretty much all the downside in case project flops.
I think this project will commercially succeed, but even then it would be good to see how much money the city ended up investing (and projected benfit from higher tax collections), and how much money was made by private investors involved in this project.
In present form this smacks of sophistry and corruption and at its barest minimum is poor stewardship of taxpayer assets even if on a contingent basis beyond the infrastructure $.
I will agree that perhaps the city could have given half of its current commitment, and let the investors go back to the banks with that assurance. A bank would be far more likely to invest a smaller amount and with more security. If such a plan were arranged, would the critics still oppose it?
The market research with currently low occupancy rates do not currently support the need for additional retail and hospitality development as evidenced by every private sector bank declining to provide financing.
Additionally one has to question why government officials chose to devote such a large amount of the cities scarce public money savings for a development that is projected to create so few low paying service jobs.
There is no better project proposal out their that would produce a better return on the publics investment in terms of greater number of higher paying jobs with more private sector equity investment and financing??
$12 million extra to pay political insiders and 100% of the city backed financing for years until after the next election when it will be obvious that this development is a failure and a burden to taxpayers.