Stadium Long-Term Financing Deal Inked
The long-term Santa Clara stadium financing plan proposed in early May was finalized at the June 12 Council meeting. The plan replaces the variable rate $450 million Stadium Authority construction loans with 25-year fixed-rate bonds and a variable rate bank loan to cover outstanding invoices for seat licenses. In five years there will only be about $30 million of bank financing outstanding, according to Goldman Sachs’ public finance chairman Greg Carey.
The financing includes $285 in bonds, with a 25-year term at a five percent fixed interest rate, and $165 million in bank loans at a variable rate of 2.71 percent. Final amounts may vary at closing on June 19. “We had over 20 firms [bidding]…it was a tremendous, tremendous project,” said Carey. “Of the billions of financial deals made in recent weeks, this financing was “the only deal that lowered rates… I want to thank the City and staff for allowing us to move very, very fast to capture the market.”
Further, public infrastructure improvements will be financed with $38 million in 40-year bonds at no more than 5.73 percent interest, with StadCo providing an interim advance for this work. The Community Facilities District (CFD) taxes – two percent hotel tax – alone, will repay the debt. The city projects that the debt will be paid off in under 40 years.
Stadium lease agreement amendments were also reviewed, including setting the initial facility rent at $24.5 million, with an optional 2015 one-time adjustment based on actual operating costs and revenues.
Other amendments include:
- Creating a renovation/demolition fund from revenue not needed for lease payments, operations and maintenance. Further, when the removation/demolition fund reaches $70 million, anything over that can be distributed to the Santa Clara general fund.
- Capping Stadium Authority insurance costs at $2.5 million annually.
- Allowing Pro Bowl and Super Bowl public safety expenses to be paid by third parties.
County Budget Up Slightly
On June 21, Santa Clara County Board of Supervisors will adopt a $4.6 billion FY 2014 budget. This is $17 million – nine percent – higher than the FY2013 budget. Find the full budget at www.sccgov.org, under County Government Budget and Finance. You can also find agendas and recordings of BoS meetings there.
Requiescat in Pace
Last week’s City Council meeting began with a moment of silence in memory of construction worker Donald White, who died in an accident at the stadium construction site that day. “The City of Santa Clara would like to express how deeply saddened we all are by the tragic accident that occurred early this morning,” said Council Member Pat Mahan in the invocation that began the meeting. “With a moment of silence we wish to express our sincere sympathies with the friends, coworkers and family of Donald White.”
“This has been a very difficult day for the entire project team,” said 49ers EVP of Development Larry MacNeil. “We were deeply saddened at the tragedy at the stadium today. We lost a friend, a co-worker, and an important member of the project team.”
The meeting was adjourned in memory of two Santa Clarans whose impact on Santa Clara will be felt for many generations.
Marjorie Edinger was a 57 year resident of the city and a great supporter of Santa Clara City Library. In her memory, her husband Ray made the single largest donation to the library in its history. In recognition of the Edingers’ peerless support for the library, the Redwood Room was renamed the Marjorie Edinger Community Room.
John George was also remembered at the June 12 meeting. He was “instrumental at Santa Clara Police Department mediating disputes between neighbors and bringing them to a successful resoution,” remembered Vice Mayor and former colleague at the SCPSD Pat Kolstad. As well as teaching law at Stanford Law School and West Valley College, George was a fouding member of Santa Clara Schools Foundation and played a key role in SCUSD’s innovative Teacher Housing Foundation.