By Jimmy Nesbitt, Evansville Courier & Press
The city plans to spend at least $292,000 more in consulting fees to settle the Downtown arena debate.
Mayor Jonathan Weinzapfel said Friday that the city will hire a construction consultant, architect and financial adviser using Tax Increment Financing funds. They will be asked to answer several questions, Weinzapfel said, the most important being whether the city can build a new arena without raising property taxes.
Weinzapfel said he is still optimistic that the city can do that.
"We have engaged experts who have vast knowledge and experience with this type of project," he said. "I am confident their analyses will help us determine whether we should move forward."
The Evansville Redevelopment Commission is scheduled to vote Tuesday on contracts for London Witte Group, HOK Sport and Hunt Construction Groups.
The contracts for HOK sport and Hunt Construction will cost $247,000 and $45,000, respectively. The cost of the contract for London Witte has not been determined.
Weinzapfel said the firms will be asked to answer several key questions: How to pay for an arena? What would be the total cost? How long would it take to build the arena? Where should it go? And what should be built?
Weinzapfel said he hopes to have answers to these questions within three months, which means the years-long debate over the future of Roberts Stadium could be ended by mid-November.
That debate began informally in August 2005, when former City Councilman Steve Bagbey raised the issue of the stadium's future at a city budget hearing. The city penciled in $32 million in improvements at Roberts Stadium, upgrades that SMG, the contractor that manages the facility, suggested.
That $32 million is still listed on the city's long term capital improvement plan for the year 2012. It was put there as a placeholder as the city debated whether a renovation of the stadium made sense.
The Roberts Stadium Advisory board and Weinzapfel ultimately determined a renovation, estimated between $38.2 million to $89.9 million, was too costly.
The board began meeting more than a year ago, using Tom Chema of Gateway Consultants to steer them through the debate. Chema, hired after the city council approved a contract with his company that cost up to $70,000, laid out the structural problems with Roberts Stadium. He then drew a list of funding sources to pay for a new arena and identified 11 sites, eight Downtown, where a new arena could be built. The funding sources for a Downtown arena did not include raising property taxes.
Chema estimated that a new 10,000-seat Downtown arena would cost around $92 million. He recommended the city pursue that option, advice that the advisory board endorsed. They did not settle on a specific number of seats, choosing instead a range of 9,000 to 11,000.
In a 100-plus page report released in May, Chema told the city to hire its own architect, construction consultant and financial advisor, because his figures, though based research of other markets and arenas, were only estimates.
Working through the Redevelopment Commission, the city has begun to lay the groundwork to pay for a Downtown arena. The city has applied for $60 million in New Markets Tax Credits, which might bring in $18 million and become one of the larger of the revenue sources for a new arena suggested by Chema. The New Markets Tax Credit program permits local investors, predominantly banks and large corporations, to invest equity in exchange for tax credits
The city expects to know whether it will receive an allocation by October. The program is highly competitive. In the last round of applications, the federal government received more than 275 applications but made only about 65 allocations.
The commission also voted to extend the Downtown TIF District to include the Executive Inn, the D-Patrick Ford properties and the Civic Center parking lot, both potential sites for a Downtown arena.
Chema estimated that a TIF District could generate $32.5 million in revenue for the arena, more than a third of the projected cost.
The Executive Inn and D-Patrick Ford properties have a combined assessed value of $5.3 million and cover 4.6 acres. Gateway said this site has a significant advantage over others because the existing convention center has a bridge that could be connected to a new arena.
Gateway Consultants is located in the same town, Cleveland, as HOK Sport, the design consultant the city plans to hire. Both companies assisted Cleveland in the process leading up to the construction of Jacobs Field, the home of the Cleveland Indians Major League Baseball team. The ballpark, which opened in 1994, is now called Progressive Field.
Accounting firm London Witte and Hunt Construction Group both have offices in Indianapolis. London Witte will analyze Gateway's cost and revenue estimates for an arena, according to the mayor's office. Hunt Construction will develop cost estimates, anticipated schedules and other construction-related issues.
City Councilman Jeff Kniese, R-1st Ward, said the city must find a legitimate way to pay for an arena before he would consider supporting the project.
"I still feel that property taxes will be used for any new project that's approaching $100 million," Kniese said. "With the amount of debt the city currently has, they have to be careful not to jeopardize any bond rating the city had or any additional capital projects that might require additional funding. There's only certain amount of money you can bond for."
Kniese has long said he would like the arena project put on a referendum, where voters, not politicians, can decide the outcome.