ST. LOUIS — A $105 million bond issue financing the expansion of the America’s Center convention complex downtown was delayed again this week after a city board overseeing the debt issuance abruptly canceled a meeting scheduled for Wednesday.
The St. Louis Municipal Finance Corp., in charge of issuing the bonds, already punted on the project in early April after several members expressed reservations about allowing such a large debt issuance backed by hotel taxes hard-hit in the coronavirus shutdown. They agreed then to take up the matter again in late May. Officials with the St. Louis Convention and Visitors Commission, backing the expansion project, had indicated last week they expected the meeting before the end of the month.
Leaders at the St. Louis Convention and Visitors Commission warned that more delay would exacerbate a cash crunch at the tourism office.
But on Tuesday, a notice for a Wednesday Municipal Finance Corp. meeting was updated: the meeting was canceled.
The chair of the finance corporation, Tom Shepard, chief of staff to St. Louis Board of Aldermen President Lewis Reed, said the board wanted to gather more information before allowing the transaction to move forward. Shepard, who expressed reservations about allowing the bond issue without more financial information last month, said no future meeting has been set.
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“We all know we have to get it taken care of sooner or later, but we just weren’t going to have what we needed to make a decision,†Shepard said.
Shepard said he consulted with two other members of the five-person board — St. Louis Budget Director Paul Payne and St. Louis Operations Director Todd Waelterman — about cancelling the meeting. Payne, who also expressed concern about moving forward too quickly last month, said members of the finance board thought the city should complete its budget for the fiscal year that starts July 1 before taking a closer look at the America’s Center expansion bonds.
It was part of a deal hammered out a year ago to expand America’s Center.
“We’d like to get through this budget crunch at the moment and then take a look at it,†Payne said.
A spokesman for St. Louis Comptroller Darlene Green’s office, which is handling the bond issue and pushed last month for the board to move ahead with taking the bonds to market, said the meeting was cancelled after a “majority decision†of the board. Green, who has a representative on the board, was fine with postponing the meeting, Green spokesman Tyson Pruitt added.
Green’s office wrestled with Mayor Lyda Krewson for much of last summer in order to control the bond financing, which produces issuance fees and the opportunity to hire advisors and attorneys for the transaction. Krewson was originally considering using the Land Clearance for Redevelopment Authority, which helped the convention commission acquire the downtown real estate for the expansion, to issue the bonds.
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The comptroller quietly submitted a proposed ‘memorandum of understanding’ to the mayor on Aug. 22, amid public squabbles between the two over the refinancing of bonds for America’s Center and St. Louis Lambert International Airport. Krewson has refused to sign so far.
The city’s bonds would cover just half of the $210 million project, first announced in late 2018. St. Louis County has agreed to pick up the other half. The new bonds would be backed by city and county hotel taxes — about $6 million annually from each — currently paying off debt taken on to build the Dome at America’s Center, where the NFL Rams used to play. That debt is expected to be repaid next year, freeing up those funds.
Convention officials had hoped to have the bonds issued by the end of next month. The expansion had already helped entice big conventions in 2023 and beyond, they said, and bond issue cash was also slated to pay down shorter term loans used to acquire real estate for the expansion.
Some scheduled events still could cancel, which would force even more cuts to the office's budget.Â
“If we start getting into June and it’s evident that we aren’t going to be getting (the bond issue) done by the end of that month, then yeah, I think that’s a pressure point,†CVC Board Treasurer Jeff Barone said during a discussion of the organization’s budget earlier this month.
Convention commission President Kitty Ratcliffe said her organization estimates the region has already lost $73 million in spending from cancelled conventions since the pandemic hit, while still shouldering America’s Center maintenance. And she said she hoped city officials would move ahead so the convention center can be marketed to groups looking to book space a few years out.
“This project is not going to have a negative impact on next year’s budget,†she said. “And the first bond payments for this project are not until 2022.â€