Title
Draw Program for the Spectrum Arena Upgrades and Refunding of Outstanding Certificates of Participation
Action
Action:
A. Adopt resolutions authorizing and approving issuance of construction period financing for up to $136,500,000, and refunding of outstanding arena certificates of participation, series 2023A up to $130,000,000 and calling for the execution and delivery of various documents necessary to complete the financing, and
B. Adopt a budget ordinance appropriating $130,000,000 to Tourism Debt Service Fund.
Body
Staff Resource(s):
Teresa Smith, Finance
Matthew Hastedt, Finance
Explanation
* On June 9, 2025, City Council held a public hearing for a draw program for up to $136,500,000 for arena upgrades, and refunding of outstanding arena certificates of participation, series 2023A up to $130,000,000.
* This action authorizes the city to enter a construction period financing in the form of draw program not to exceed $136,500,000, allowing the city to reimburse expenses monthly during construction and elimination of interest expense on funds not yet expended on the projects.
* A drawdown construction period financing reduces interest cost and provides flexibility in the timing of the spending. It is a routine financing mechanism for capital projects financed with debt.
* This action also authorizes the city to convert the series 2023A certificates of participation from a variable interest rate to permanent fixed-rate financing.
* The approved projects being funded will assist with contractual obligations of the city to provide capital repairs and improvements, and finance other renovations and upgrades to meet the National Basketball Association requirements, to keep the arena competitive, to make it more environmentally friendly, and to help attract additional events.
* With the City Council approval, it is anticipated the North Carolina Local Government Commission will approve this action at its July 1, 2025, meeting.
Fiscal Note
Funding: To...
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