The Broomfield City Council has unanimously approved the first reading of refinancing of the 2005 Broomfield Urban Renewal Authority's bonds used to construct the 1stBANK Center.
In its Tuesday night meeting, council members approved the first reading of an ordinance that will refinance the bonds used to pay for the defunct event center. The bonds, first issued in 2005 to the Broomfield Urban Renewal Authority, totaled $61 million.
The current balance of the bonds is $31.23 million with an annual debt service of approximately $4.73 million. Staffers explained that the refinancing is required because the current bonds are subject to an annual letter of credit, but the bank that issues the letter of credit will not be renewing as of March of next year.
Economic Vitality Director Jeff Romine explained that the refinancing of the bonds would allow for three important changes -- convert the debt from a variable rate to a fixed rate, reduce the overall debt by accelerating funds currently held in reserve, and allow the flexibility of selling the event center site while the bonds remain outstanding.
The event center was closed last fall after years of underperformance and underutilization, according to Broomfield staffers. By the time all the bonds used to finance the center are paid off, the county will have put $135 million towards its construction with demolition of the building costing an additional $3,325,000. Demolition is currently underway and is expected to take approximately six months.
Romine said that the exact number for how much the Broomfield Urban Renewal Authority would save on the bonds isn't known yet, but the new bonds are anticipated to sit at $22.83 million with annual debt service averaging $4.47 million after reserve funds are put towards the bond.
The bonds are paid off with a combination of Arista area property taxes and 10% of collected sales tax in the area. The next reading of the ordinance is scheduled for Jan. 14. Residents can attend in person at the George Di Ciero City and County Building Council Chambers, 1 DesCombes Drive, or online virtually at broomfield.org/128/City-Council.