Woodbury seeks exception from state for Bielenberg Sports Center fundingIt’s not a matter of whether Woodbury can find money to pay for an expansion at its signature Bielenberg Sports Center. It’s a question of where the city can get the best deal.
By: Mike Longaecker, Woodbury Bulletin
It’s not a matter of whether Woodbury can find money to pay for an expansion at its signature Bielenberg Sports Center.
It’s a question of where the city can get the best deal.
Right now city leaders are banking on a bill at the Legislature that would change state law just for Woodbury. The change would create an exception in Minnesota law that currently requires cities to receive voter approval to fund construction projects involving municipal sports arenas.
Proponents of the bill say Woodbury is in a unique position to receive the exception since the city will not be asking more from taxpayers.
“I think it’s a good project,” said Sen. Ted Lillie, R-Lake Elmo. “I am in favor of saving the taxpayers money.”
Bielenberg Sports Center (BSC) is set for a major overhaul, including replacement of its aging dome enclosure with a permanent field house structure. Plans call for the new field house to be nearly twice the size of the current dome, boosting its square footage from 44,000 to 80,000.
Project supporters say the larger facility will increase capacity and free up space for more programs, such as football and lacrosse.
City Administrator Clint Gridley said eventual expansion has been part of the plan since the original facility was constructed in 1995.
“It’s been in our capital plan for a long time and was envisioned from the beginning,” he said, calling the BSC facilities – which now include 36 athletic fields and two sheets of ice – “a jewel of the region.”
Savings are possible
The plan, Gridley explained, is to pay for the $15.5 million project through a few local sources.
The primary source – and the one that requires legislative approval – would be the extension of existing levies that were issued for prior BSC projects. Those levies are set to be retired in coming years – one in 2015, the other in 2019.
Ice-sheet related projects at BSC tapped general obligation debt that is being paid off through user-generated revenue. Dollars directed to pay off that debt – set to be retired in 2019 – would be used to cover any remaining financing gaps, according to plans. Plans also allow for the city to tap fund reserves.
Gridley said the key is that the primary funding source utilizes general obligation bonds, which can be paid back at a lower interest rate than the alternative: utilizing the city’s Economic Development Authority to issue lease revenue bonds.
Gridley said the city stands to save about $1.8 million by selling general obligation bonds.
The other alternative would be putting it to a public vote. Gridley said that option is less desirable since it would likely require holding a special election, which would come at a price. He said the “complexities of a special referendum” would also present risks.
So what would it take for Woodbury’s bill to eventually land on Gov. Mark Dayton’s desk?
Perhaps more than meets the eye.
For starters, lawmakers could wince at the idea of authorizing a tax renewal that doesn’t necessarily have taxpayer support.
Lillie said that will mean making a case for Woodbury’s special circumstances.
“I think that we have to be careful as a Legislature that we evaluate changes like this fully,” he said. “What works in Woodbury may or may not work in Cloquet or Warroad or Rochester.”
Gridley said he believes those circumstances are legitimate, arguing that the city is “only looking to rebuild what we have.” Previous BSC projects received support through referendums in 1994 and 1998, he noted.
“It’s nothing new for us,” Gridley said. “If it were a new line of business … that’s one argument. But there has been referenda in support (of previous projects).”
Time is also a factor. Gridley said the legislation must be acted on this session, which is set to adjourn in April. The project, which is being steered by a citizens’ task force, requires a financing package to be completed this year.
Currently the bill is only moving in the House; no companion bill has yet been introduced in the Senate.
Lillie, whose position as majority whip requires him to size up support for bills among the GOP Senate caucus, said the Bielenberg bill has not yet been discussed broadly in the caucus.
That doesn’t mean it can’t emerge and grow legs, he said.
“I think this is an argument we can make to the caucus and the Legislature,” Lillie said. “I think this could happen.”