Mayor explores options for WAC expansion
Posted on Tuesday, May 13, 2008
URL: http://www.nwanews.com/nwat/News/65145/
When it comes to keeping the Walton Arts Center in Fayetteville, nothing’s off the table for Mayor Dan Coody.
Coody invited Dennis Hunt with Stephens Inc. to the Fayetteville Advertising and Promotion Commission meeting Monday to discuss the possibility of restructuring the city’s Hotel and Restaurant Gross Receipt Tax Refunding Bonds to generate capital improvement funds.
Arts center officials are conducting a feasibility study as part of a plan to build additional performance spaces. That prospect has raised concerns that the center could relocate outside Fayetteville.
Other than refinancing the tax bonds, there appear to be few options for the city to raise money to help the arts center remain and expand in Fayetteville, said Hunt, senior vice president and manager of the Stephens office in Northwest Arkansas.
“ It’s probably, in my mind, the only way the city could increase any funds without increasing taxes, ” he said.
The city issued the bonds in 1998 to raise about $ 6. 95 million to build the Fayetteville Town Center.
The outstanding balance of the bonds will be about $ 4. 15 million as of Oct. 1, the date on which they will be eligible to be refinanced. They also were restructured in July 2003, which reduced annual payments from $ 760, 000 to $ 672, 000.
Based on that current debt service, a 20-year issue would provide about $ 4. 66 million and a 25-year issue would provide about $ 5. 77 million, according to an analysis Hunt presented to the commission. Each additional $ 100, 000 of the tax being allocated to the debt service would provide about $ 1. 3 million for a 20-year issue or $ 1. 5 million for a 25-year issue, according to the report.
Any bond restructure would require voter approval.
Coody said there is no way to estimate how much money might be needed for an arts center project in Fayetteville, but he said the most cost-effective solution is for the center to expand at its present site off Dickson Street.
Nearby property owners have offered to sell property to the city if it means keeping the Walton Arts Center downtown, Coody said.