THE INDEPENDENT NEWS
COURTHOUSE – The city is scheduled today to vote upon whether to accept changes to the financing plan to build an Oceanfront arena that will let developer United States Management pursue unrated bonds rather than bonds rated by a major agency, as Virginia Beach had sought.
City Manager Dave Hansen briefed the city council on changes to the plans to finance the arena on Tuesday, Sept. 27, at City Hall, and the matter was discussed during a closed session. A public hearing is scheduled for the meeting at 6 p.m., Tuesday, Oct. 4. Additionally, the city’s development authority also would hold a special meeting and vote on its part of the process, possibly that same day, according to a city presentation.
USM had upped its equity by $7.5 million since a previous plan to address possible risk from the change to unrated bonds.
Regarding the use of an unrated bond, Hansen said it was was one of a list of conditions set for the project.
In an interview, Valerie Wilkinson, USM’s chief financial officer, said such financing is not unusual for a major project and that the fact that the project is not a municipally-funded arena made getting a bond rating letter challenging and might delay the project. “The bond market is incredibly favorable right now,” she said. “That’s why we want to move expeditiously.”
City Councilmember Barbara Henley, who represents the Princess Anne District, said during an interview on Tuesday, Sept. 27 that she still has the concerns about the project that led her to cast the lone vote against it.
In the past, Henley has relayed concerns about the city’s responsibilities, such as guaranteeing parking, the length of the lease and worries about the fallout from the project should it fail. Henley addressed similar concerns this past week.
“There are just a lot of risks — a lot of risks to the city — and I’m not a really good gambler,” Henley said.
Councilmember Dr. Amelia Ross-Hammond, who represents the Kempsville District, said she had some questions following the briefing, but she had a conversation with Andrea Kilmer, president of USM, to address some of them. “I was comfortable with her response,” Ross-Hammond said.
She declined to say how she might vote, but said the arena could help the city by creating jobs and development.
“Overall,” she said, “I think it will be an economic driver.”
Kilmer on Tuesday said USM is compensating for any risk changes might generate. She said they hope to move forward and potentially close on financing within weeks.
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