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Arena deal hinges on new revenue
Feb 03, 2005 12:00 am
New sales and property taxes generated by a proposed multipurpose events center will help pay for its construction. instead of going into the Lebanon and Wilson County's coffers during the next 20 years, event center developers said Tuesday.
An entertainment district tax enveloping the events center and land incorporated in its master design will also help pay off the debt incurred by bonds, which could be taken out by the Wilson County Sports Authority, according to the financiers of the events center. The bonds, however, would be guaranteed by a partnership of Lebanon and Wilson County governments, said Thomas Hocking, who mapped out finance possibilities during a Lebanon City Council work session Tuesday night.
Hocking, president of TLHocking & Associates LLC, explained projected revenues from ticket sales, facility user fees, rental fees and contracts with individuals and businesses for naming rights, club seats, ads and signs as well as tenants' rent will fund the operational costs of the multipurpose center. Lebanon and Wilson County sales and property taxes as well as the proposed entertainment district tax will pay off the debt to build the facility, Hocking said.
"The people who use it will be paying for it," he said following the one-and-a-half hour long presentation Tuesday.
Lebanon City Councilor and Wilson County Commissioner Annette Stafford liked the idea of visitors paying for the facility rather than taxpayers.
"I was OK with using sales tax revenue, because I know it has to be paid from somewhere," she said. "And outsiders are paying for it without realizing it."
Stafford, other Lebanon city councilors and Wilson County commissioners, however, want to tread carefully in regards to financing the project.
"As long as it's financially feasible, I would love to see the city and county to do a joint venture with a Global Entertainment Corp," Stafford said. "I think it's a great opportunity for us. I think financing will have to be feasible. As long as it doesn't cost us the turnip shack, I'll be fine."
Ward 3 Lebanon City Councilor William Farmer asked who would guarantee the bonds or loans – possible taken out by the Wilson County Sports Authority – to construct the building.
"The answer I got is several parties would guarantee the bonds," Farmer said after the meeting. "That would have to be looked at carefully because it's a potential obligation of the taxpayers."
Not costing taxpayers money has been a constant theme among councilors and commissioners as well as Global Entertainment Corp., the company proposing to bring the events center to Lebanon. In fact, during the presentation, Global Entertainment President and CEO Rick Kozuback noted "no city/county direct tax support" will be required to complete the facility.
As long as that fact remains true, councilors and commissioners are supporting the facility possibility.
"As long as it doesn't cost the county money, I'm for it," District 23 County Commissioner Rhonda Moore said. "I think we definitely need it."
But the county commissioner pointed out financing must be feasible before it can become a reality. Ward 6 City Councilor Kathy Warmath agreed.
"It'll be how we are going to fund it," she said. "The bottom line is everything."
For another elected official, the bottom line is not everything.
District 15 County Commissioner Billy Swindell wondered why Global Entertainment is willing to bring such a center to Lebanon and where their bottom line lies.
"I'm impressed with the presentation, but we've got to get legal people involved to see what Global's responsibilities are and what Lebanon and Wilson County's responsibilities are," he said.
He explained he doesn't know how Global Entertainment will profit from constructing and running the facility if all revenues will pay for operational costs as well as its debt.
"And there has to be contractual agreement to see they hold up their end of the bargain, and we hold up ours," he said.
Night News Editor J.K. Devine can be reached at 444-3952 ext. 46 or by e-mail at email@example.com.