Chattanooga officials said Tuesday that plans are to issue no more than $80 million in bonds for a proposed minor league baseball stadium even if costs rise due to interest rates or other expenses.
"We're not coming back for $82 million or $84 million," said Brent Goldberg, the city's chief financial officer, to the Chattanooga-Hamilton County Sports Authority at a meeting of the panel.
Goldberg said plans are to seek a design for the best stadium possible with the available funds.
"We're going to figure it out within that $80 million," he said. "We'll do design-build or we'll use value engineering."
The multiuse stadium is proposed on old foundry property in the South Broad District with the Chattanooga Lookouts as the primary user.
Goldberg said if private developers interested in projects around the stadium want to contribute money to construction, they can do so.
Also, the Sports Authority approved an agreement enabling the city to pay for initial geotechnical and environmental work at the stadium site and be reimbursed later after bonds are sold to finance the building of the facility.
Jermaine Freeman, senior adviser for economic opportunity for Chattanooga Mayor Tim Kelly, told the panel issuing bonds isn't expected for a few months and the agreement would permit some work to start at the site.
Groundbreaking is planned for April for the stadium project, officials have said. That would allow for a planned April 2025 opening for the ballpark where the Lookouts owners would like to start the team's season that year.
The authority agreed to hire the firm PFM as a financial consultant and Bass, Berry & Sims as bond counsel as the bonds are prepared to be issued.
John Shearburn, the panel's chairman, asked how increasing interest rates are affecting the bond market.
Goldberg said while rates are volatile, most bonds have rates from the 4% to 5% range.
Chattanooga and Hamilton County already have approved creation of a special tax district around the planned stadium. Most of the new property tax revenue from the special district, Lookouts' lease payments of at least $1 million annually, sales taxes, parking revenues and $1.4 million each from the city and county will pay for debt service on 30-year bonds to be issued for the project, officials have said.
Through tax-increment financing such special districts are designed to spur development in areas often before economic activity would typically take place.
Revenues from the tax district of about 470 acres around the stadium would pay for 58% of the project. The district includes not just the 120 acres of developable foundry property, but the South Broad area around it. Also included are a number of tracts south of Chattanooga Creek, including a site for a proposed greenway connecting to Alton Park.
City and county officials have said they initially expect $350 million in new development in the tax district over the 30-year period, but Kelly has said $1 billion or more is anticipated.
Contact Mike Pare at mpare@timesfreepress.com or 423-757-6318. Follow him on Twitter @MikePareTFP.