Calling it a time to be brave, City Council President Keith Jarboe and fellow Democrats on Monday endorsed the recommendations of the Roberts Stadium Advisory Board to build a Downtown arena.
As expected, Jeff Kniese, R-1st Ward, cast the lone nay vote, saying the project, estimated to cost up to $127 million, should be decided by a voter referendum.
Rarely do projects this large supported by taxpayer dollars come before the council, Kniese said. The arena will be funded with Tax Increment Financing revenue, casino receipts and food and beverage taxes, according to a plan prepared by the city's financing consultant London Witte.
Kniese said he wasn't opposed to building an arena, but "let's have as much community input as possible." The only way to do that, he said, was to petition the state to put the project on a referendum in 2010.
Jarboe, D-at large, said the City Council has made many big decisions involving large amounts of money that didn't require a referendum. Mayor Jonathan Weinzapfel's $216.9 million city budget for 2009 and millions of dollars in sewer improvement projects were approved without referendums, Jarboe said.
"Ultimately, we get paid to make the tough decisions," Jarboe said.
Referendum requirements
According to state law, the project is exempt from a referendum because the funding plan does not include the use of property taxes.
Delaying construction of the arena could make the projects more costly and could require an additional feasibility study to analyze the funding sources, Weinzapfel said.
Any chances Evansville has of receiving economic stimulus money from President-elect Barack Obama's administration for infrastructure "would be long gone," he said.
Weinzapfel pressed that Evansville can become a leader in the state by undertaking a project that will create hundreds of jobs and spur economic development "or... crawl back into our shells and fall behind."
The resolution approved at the meeting is non-binding. The next big step will come at the state level. The Legislature must approve a change in the use of the food and beverage tax before the city can use that money. The tax currently generates about $3.6 million a year.
State Rep. Dennis Avery, D-Evansville, has said if the change could take effect as soon as July 1 if approved during the next session. If the change is approved, the city would issue bonds later that fall.
Several people who have spoken at the public meetings for the arena have expressed concerns that property taxes will be used to support a bond issue for the project.
Bob Swintz, a certified public accountant for London Witte, said, "there will be a description of revenues, but there will not be a pledge of property taxes ... it will not be in the description of the bonds."
After the meeting, Kniese said he doesn't believe the city will be able to sell bonds without using property taxes as a backup revenue source.
"I think the investor community is going to require that," he said.
In other business, the council also:
Approved a plan for fiscal services to annex a part of the West Side that includes a heavily commercial area west of Red Bank Road. The area consists of 2,142 acres with an estimated population of 2,664, an average of 1.24 people per acre. The current assessed valuation is $229,091,300. The area would be assigned to the seat held by B.J. Watts, D-6th Ward.