Commissioners want game plan from Wenatchee before approving vote on TTC tax increase
Originally published January 31, 2012 at 8:22 a.m., updated January 31, 2012 at 9:07 a.m.
WENATCHEE — Chelan and Douglas County commissioners want to see a clear plan of what a 0.2-percent sales tax will pay for before they approve a public vote that could save the Town Toyota Center.
Commissioners from both counties met in executive session Monday to hammer out points they need from the city of Wenatchee before putting a sales tax increase before voters next April. The session Monday followed a lengthy discussion between the six commissioners, attorneys and Wenatchee Mayor Frank Kuntz.
Investors seek extension of lawsuit window
By Michelle McNiel
World staff writer
WENATCHEE — Investors holding about one-third of the Town Toyota Center’s outstanding debt have asked the arena’s owner and nine local governments to waive the statute of limitations for being sued.
The Denver-based law firm of Davis & Ceriani sent letters and e-mails Monday to the Greater Wenatchee Regional Events Center Public Facilities District seeking the extension by Feb. 29.
The law firm sent similar letters to the mayors and county commissioners of the nine local governments that are members of the PFD. They are Chelan and Douglas counties, the cities of Wenatchee, East Wenatchee, Cashmere, Entiat, Chelan and Rock Island, and the town of Waterville.
If they do not sign the agreement, the letter states that the bondholders will pursue legal action.
The letter also stated the bondholder group wanted a face-to-face meeting with PFD representatives as quickly as possible. All communication between the district and that group of bondholders has either been in writing or by phone.
The law firm represents investors who hold nearly $13 million of the arena’s $41.8 million debt, which went into default on Dec. 1.
The firm first wrote the PFD last October demanding full repayment of the investment on Dec. 1. However, the firm wrote another letter in November saying the investors were “encouraged” by local efforts to find a way to pay off the debt. In that letter, dated Nov. 10, the firm stated that it would be seeking a an extension with the PFD.
This week’s letter only sought such an agreement with the PFD, and not with the nine governments that make up the PFD.
The PFD and the city of Wenatchee have already secured similar agreements — which keep the legal door open for lawsuits — with Piper Jaffray, the underwriter of the Town Toyota Center bonds; and K&L Gates and Foster Pepper, which have served as bond counsel for the arena board.
Michelle McNiel: 664-7152
The two counties are part of the nine-member Greater Wenatchee Regional Event Center Public Facilities District that owns the financially troubled center. Governments of Cashmere, Entiat and Rock Island have taken steps toward a vote on the tax. All nine have to agree before the issue could be put to a public vote without state legislative action. All nine allowed state taxes from their areas to be used for an arena in 2008, but only Wenatchee promised financial backing if the arena could not support itself. It can’t, but Kuntz said the city can’t support it on its own. The center’s $42 million debt went into default Dec. 1.
“Every meeting we’ve been to, there has been some new revelation that we hadn’t heard before. It’s been a moving target,” said Chelan County Commissioner Doug England. England said he wants to see a firm plan before agreeing to ask voters to decide.
Commissioners on both sides of the Columbia River echoed the sentiment, hoping to put pressure on Wenatchee officials to give them something solid to take to voters, including a provision to keep the center open.
“How do you sell a pig in a poke if the building is closed,” said Ken Stanton, Douglas County commissioner. If it closed before a tax rescue could be put before voters, “that would be the death knell,” he said.
Stanton said Douglas County commissioners agree it’s in the best interest of the county to support the center, but they want to see Wenatchee take major responsibility for developing a workable plan. Support in helping pay for the center will in the long run be cheaper than paying for lawsuits that will come if the debt isn’t paid, he said.
“Until Wenatchee steps up to the plate and is open and up front, I’m not in a hurry to make a decision,” said Douglas County Commission Dale Snyder. A clear plan to raise how much money and how it will be spent is also needed to convince state legislators who may need to pass or amend regulations to allow the election and financial support, he said. Some commissioners from the two counties are planning to travel to Olympia Thursday. At least two pieces of legislation concerning the center are now working their way through the system.
Kuntz said the city wants to be as up front as possible but said there are stumbling blocks to every plan the city has looked at to pay off the center’s $42 million debt and none guarantee that the center will stay open.
“We are in a difficult spot. We can’t do this alone,” Kuntz said. All plans are to keep the building open through the Wenatchee Wild hockey season through March, and maybe longer if the Wild make it to the playoff season, he said. The Wild are the ice arena’s main tenant.
“If we can’t come up with a funding solution by April 30, then we may not be able to keep it open,” he said. “I don’t see how the city can keep it open without all nine of the entities signing on to some kind of tax.” Kuntz said he believes there’s a 95 percent chance that a 0.2-percent tax from all of the enties would provide enough money to keep the center going while paying back most of the debt, “but we can’t guarantee that because no one can predict what will happen with bond and interest rates next year.” The city could not raise enough money if it was the only entity to pass the tax, he said.
Both counties will have representatives at a meeting of the Public Facility District Wednesday, said Ron Walter, Chelan County Commission chairman, after the executive session.
“Both Chelan and Douglas counties hope to come out of that meeting with a decisive path to move forward,” he said.
Rick Steigmeyer: 664-7151
MORE LIKE THIS
Saturday, May 18
The Flying Karamazov Brothers
Performing Arts Center of Wenatchee, 7:30 p.m.
Sunday, May 19
Wenatchee Women's Show
Performing Arts Center of Wenatchee, 1 p.m.
Sunday, May 19
Local Author H.S. Clark is Signing His New Thriller at Hastings in Wenatchee
Hastings Entertainment, 315 9th St., Wenatchee, WA, 1 p.m.
Monday, May 20
Conquer Your Fear of Public Speaking - Toastmasters Meeting
First United Methodist Church, 5:30 p.m.