UPDATE: Louisville’s YUM Center Raids Reserve Fund to Make Bond Payments, TIF Revenue Comes up 57% Short of Projections

15

The Louisville Courier Journal learned through documents obtained through the Open Door Laws that the KFC YUM Center has depleted a reserve fund of $3 Million established for repairs and maintenance down to $4,000 since April to make regular payments. The need to take such actions is reported to be caused by a shortfall in tax revenues earmarked to pay off the state of the art arena in Downtown Louisville that opened two years ago this fall.

Louisville sources have disclosed that the downtown TIF (tax increment financing) district that was expected to return over $14 Million only produced slightly over $6 Million making the raid on the reserve account necessary. The Ford Center is also depending on a steady predictable cash stream from a downtown TIF district to cover much of the debt service for the Ford Center.

Link to full article:

http://www.courier-journal.com/article/20120806/BUSINESS/308060111/-3M-arena-renovation-money-raided-debt-payment?odyssey=tab|topnews|text|News&nclick_check=1

RELATED ARTICLESMORE FROM AUTHOR

15 COMMENTS

  1. Ford Center in Evansville, Ind. shall follow suit.

    Now that’s a “Chicken Fat” Video in the making when the bond banker comes calling.

  2. How much of the TIF money to pay the note on the Ford Center was supposed to come from the hotel that ain’t even close to being started? I bet you dudes at the CCO $50 that the City will have to deal with a TIF money blowout just like Louisville is.

  3. Except to note that our Ford Center already walks with a limp due to the lack of the promised HOTEL!

  4. Evansville’s downtown TIF district is not currently producing revenue from property taxes at the level identified as necessary to meet the debt service on the Ford Center bonds.

    So, one of the identified sources of revenue for debt service on the bonds is failing. How will it be made up: raise taxes at the boat, COIT, get the city council to agree to add the shortfall to property taxes, rescind all property tax phase-ins in the downtown TIF?

    What is it going to be Mr. Winnecke?

    __

  5. Has anyone stopped to think about how much these studies for the hotel have saved your city?

  6. These studies have provided enough time to for right to work to take hold and allow the use of a non-union contractor. Which has in turn has instantly solicited responses from qualified firms that will be able to build more for less!

    • Okay, I will bite. I do not think that right to work has anything at all to do with a project in which public money is spent. Davis Bacon laws apply to projects with public funding of any amount and that requires prevailing wages. Contractors have always been free to use non-union labor as long as they paid them prevailing wages which are essentially union rates.

      The only way your scenario would get around Davis Bacon wage rules is if there is no public money in the project. That is not going to be the case with the hotel.

      • I don’t think Davis bacon has anything to do with benefits. Isn’t it wage based only? Total package hourly wage for a union laborer is about 40.00 an hour. Take the benefits out and it’s about 23.00 hourly. Not having to pay benefits would save a fortune.

        • Good input. I do not know about the benefits side. Davis Bacon with or without benefits was in effect before and will be now. I do not think RTW would make any difference on a public works project. I hope there are some savings that the people of Evansville can benefit from.

        • Googled this:

          “The Davis–Bacon Act of 1931 is a United States federal law which established the requirement for paying prevailing wages on public works projects. All federal government construction contracts, and most contracts for federally assisted construction over $2,000, must include provisions for paying workers on-site no less than the locally prevailing wages and benefits paid on similar projects.”

          Looks like they do force the benefits to be paid.

          • Yes, the Davis-Bacon act was passed by Congress and signed into law by President Herbert Hoover on March 3, 1931. Another one of those mean old Republicans.

            __

    • About what? The TIF shortfall at YUM Center? That is pretty much memorialized in facts right now.

  8. I was referring to the logic behind the stalled hotel project and Hunden studies. See previous posts.

Comments are closed.