City Council approves $45 million bond issue for Arena
Savannah City Council voted today to approve a $45 million bond issue to shore up funding for the over-budget Savannah Arena.
Though the idea appeared to have been formulated very recently, a strong plea from City Manager Rob Hernandez forced Council's hand.
"I don't know how anyone was led to believe that Savannah could afford two performing arts facilities [the new Arena and the old Civic Center]," Hernandez told Council.
"The reality is, and I'm sorry to break this news, we can't afford both... if this doesn't pass today, I have no choice but to advise the design team to put [the Arena] on hold."
The Arena has far exceeded its existing allotment from Special Purpose Local Option Sales Tax (SPLOST) funds, and it is not on the project list for the upcoming round of SPLOST, up for voter approval this November.
Alderman Van Johnson suggested that Council hadn't yet decided on the fate of the existing Civic Center, but its days appear numbered.
The bond issue effectively signs the death sentence for the existing Civic Center, as the funds to pay back the bonds will come from the same rental vehicle tax the City uses to maintain the Civic Center — which currently loses nearly $2 million a year.
Alderman Brian Foster said, "The impact of this in order to keep the arena project moving forward, funding for the Civic Center will go away... and [the Civic Center will] need to be sold."
The veiled threat to halt the project from Hernandez worked, and there were only two dissenting votes, Tony Thomas and Estella Shabazz.
Thomas said: "We need much more understanding of what is going to go on with the old Civic Center.. before we issue $45 million in bonds that will be repaid by the public."
Earlier in a Council workshop, Hernandez told Council that City staff
"will be coming back to you over and over again on arena-related issues."
Though the Arena was sold to voters as nearly a self-sustaining market entity, Hernandez said there will need to be ideas on how "create a long-term funding source" for the arena, including possibly making it a Community Improvement District (CID).
Also, Hernandez alluded to the fact that there has as yet been no real discussion of the design or cost of any of the several parking garages/facilities that will eventually be needed to accommodate Arena patrons.
The hasty bond issue comes as Council is set to break ground on the Arena soon before this year's election.