A vote on city support for the Southside Stadium is back on the City Council agenda for Tuesday afternoon after being pulled last Tuesday.
The County Commission is expected to follow suit on Wednesday.
The stadium cost has risen from $79.5 million to $115 million-$120 million.
Here is the council resolution:
RESOLUTION NO. ______________
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CHATTANOOGA APPROVING THE ISSUANCE OF
ADDITIONAL DEBT OBLIGATIONS OF THE SPORTS
AUTHORITY OF THE COUNTY OF HAMILTON AND THE
CITY OF CHATTANOOGA, TENNESSEE TO FINANCE A
MULTI-USE STADIUM
WHEREAS, the City Council (the “Council”) of the City of Chattanooga, Tennessee (the “City”),
has met pursuant to proper notice; and
WHEREAS, the Council is interested in preserving and promoting the economic welfare, employment opportunities, educational growth, and vitality of the City; and
WHEREAS, the Council has previously determined that the construction of a multi-use sports and entertainment stadium (the “Stadium”) and related facilities in the South Broad District of the City will be in the public interest of the citizens of the City and Hamilton County, Tennessee (the “County”) and will encourage and foster economic development and prosperity for the City and the County; and
WHEREAS, the City expects that substantial private development will occur proximate to the Stadium, with an expected cost substantially in excess of $100,000,000 as described in Section 67-6-103(d) of the Tennessee Code Annotated; and
WHEREAS, the Council, pursuant to Chapter 67, Title 7, Tennessee Code Annotated (the “Act”), has previously approved the creation of The Sports Authority of the County of Hamilton and the City of Chattanooga, Tennessee (the “Authority”), for the purpose of exercising all powers granted to a sports
authority by the Act, including, without limitation, the ownership, financing, constructing, and leasing of the Stadium; and
WHEREAS, the Authority was jointly created with the County with the approval of the Board of Commissioners of the County; and
WHEREAS, it is expected that the Authority will issue bonds to pay for a portion of the costs of the design, development and construction of the Stadium (the “Sports Authority Bonds”); and
WHEREAS, pursuant to the requirements of Section 7-67-109(15) of the Act, the City has previously approved the issuance of the Sports Authority Bonds in a principal amount not in excess of $80,000,000; and
WHEREAS, to enhance the marketability of the Sports Authority Bonds and to reduce the interest costs thereon, and to otherwise provide assistance to the Authority as authorized under the Act, the City has made certain agreements with the Authority and the County relating to the financing and operation of the
Stadium, including an agreement (i) to provide certain funding to the Authority in the event of a shortfall in revenues needed to pay debt service on the Sports Authority Bonds; (ii) to pledge certain revenues of the City and the County to secure such funding; and (iii) to provide funding for a capital repair and replacement fund with respect to the Stadium; and
WHEREAS, such agreements were made pursuant to an Interlocal Cooperative Agreement (Multi-Use Stadium Project) (the “Interlocal Cooperative Agreement”), between the County, the City, and the
Authority; and
WHEREAS, due to an increase in the estimated cost of the Stadium from when the Interlocal Cooperative Agreement was approved, the City has been requested to approve, pursuant to Section 7-67-109(15) of the Act, the issuance of additional debt obligations by the Authority (the “Additional Sports
Authority Debt”) to pay costs of the design, development and construction of the Stadium, provided that the Additional Sports Authority Debt shall not be subject to the financial support to be provided by the City in the Interlocal Cooperative Agreement; and
WHEREAS, the Council, on behalf of the City, desires to approve the issuance of the Additional Sports Authority Debt, subject to the terms contained herein.
NOW THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CHATTANOOGA:
SECTION 1: Pursuant to Section 7-67-109(15) of the Act, the Council hereby authorizes and approves the issuance of the Additional Sports Authority Debt to be issued by the Authority, provided that such Additional Sports Authority Debt shall not exceed an aggregate principal amount of $32,000,000,
shall bear interest at an interest rate determined by the Authority to be reasonable for such type of a debt instrument and that does not exceed the maximum interest rate permitted by Tennessee law, and has a term not to the exceed the period from the date of issue through the conclusion of the thirtieth (30th) full fiscal year of the City following the date on which the Stadium is placed in service. In no event shall the aggregate principal amount of the Sports Authority Bonds and the Additional Sports Authority Debt exceed
$112,000,000.
SECTION 2: No recourse shall be had against the City for the payment of the Additional Sports Authority Debt, and in no event shall the full faith and credit or taxing power of the City be pledged to the payment of the Additional Sports Authority Debt. The obligations of the City to provide financial support to the Authority pursuant to the Interlocal Cooperative Agreement shall not be applicable to the Additional Sports Authority Debt.
SECTION 3: The Mayor and all other officers of the City and the Authority and its officers and representatives are hereby authorized to take such actions and request such approvals as are necessary or are deemed advisable to effectuate the terms of this resolution.