This rendering depicts the proposed downtown Rocky Mount Event Center.

Contributed image

This rendering depicts the proposed downtown Rocky Mount Event Center.

Price of proposed event center increases

By John Henderson

Staff Writer

19 Comments | Leave a Comment

The estimated price tag for a downtown event center has increased by $4.8 million over initial estimates in a draft report from the city’s financial adviser to Rocky Mount city staff.

In a prior report, the Chicago-based consulting firm AECOM Technical Services estimated the total costs for a 5,000-seat downtown event center would be $37.2 million.

But in a draft report submitted to city staff on March 12, the city’s financial adviser Davenport & Co. states that another $4.8 million would need to be spent on land, working capital, general contractor fees and contingency and project management costs.

Rocky Mount City Manager Charles Penny met with staff last week to discuss Davenport’s report, which outlined five different possible funding scenarios, including one that involved foreign investment in the project.

Penny said Davenport’s information is for staff use, and he said the event center funding options in Davenport’s report are only suggestions that he may or may not incorporate into a recommendation to the City Council.

“I might end up not recommending the project move forward at all,” he said.

Penny is scheduled to make a presentation to the council at 2 p.m. Monday at the Committee of the Whole meeting. The public is invited to attend, but public comment will not be taken at the meeting, which is scheduled to be held in the committee room on the third floor of the Frederick E. Turnage Municipal Building at 331 S. Franklin St.

Members of a citizens’ group that is questioning whether the city can afford the project, The Community Council, were not happy to learn the projected cost has increased.

“If the cost of construction has increased by as much as $5 million, that’s additional cause for concern,” said Skip Carney, who owns a local advertising firm. “The big question, though, is how will we pay for the new debt and operation losses? It sounds as though we’re looking at around $4 million per year in negative cash flow, and that’s going to impact every citizen in this area.”

He said he hopes that one of the options involves private investment by a company with expertise in operating such venues.

“If they can find a company like that, it would increase public confidence in the project,” he said. “I’m looking forward to hearing the details on the financing report Monday afternoon at City Hall.”

With grant money from PNC Bank, the city hired AECOM to conduct a feasibility study for a new downtown event center, which is proposed to bring in events such as concerts and conventions. AECOM is recommending a multipurpose facility with approximately 5,000 seats and an additional 15,000 square feet of event space for gatherings such as meetings and banquets.

Davenport’s draft report states that the estimated net operating loss, which does not include debt service, would be $624,000 in the first year, and decrease each year until it is $382,000 in the center’s 10th year of operation.

Davenport’s report lists different funding options that could help pay for the center.

One is EB-5 Funding, a federal program that provides a visa to foreign investors in exchange for an investment in a commercial enterprise in the United States. It requires a minimum investment of $500,000 in a Targeted Employment Area that creates or preserves 10 full-time jobs per investor for U.S. workers over a two-year period.

Another option is a public-private partnership lease, which is a partnership with a private developer who would agree to finance, build and maintain the facility in exchange for a long-term operating lease with the city.

The city could look to a banking institution to provide some or all of the funding for the project, Davenport’s report states. That could include a traditional long-term bank loan of 10 to 15 years, a short-term loan of seven years, a bank letter of credit backing a variable rate loan or variable rate bonds, or bank participation by purchasing bonds as part of a public sale of special obligation bonds.

“PNC Bank has expressed a willingness to discuss potential funding options,” Davenport’s report states. “However, due to the evolving regulatory environment and nature of the project, PNC is not able to commit to any of the above mentioned funding options at this time. PNC would like to continue discussing ways to partner with the city on the project funding.”

Installment contract financing is also an option, the report states. It requires the pledge of an asset being financed through bond issuance.

Another option, the report states, is special obligation bonds, which would be paid back with existing sales tax and occupancy revenues or other sales and use taxes associated with the center.

New Market Tax Credits might also be considered, the report states. They are issued through a federal program designed to spur new or increased investment in low-income communities. The program provides tax credit incentives to investors for equity investments in certified Community Development Entities.

Comments

Event center

Well I can not believe our city leaders want to spend more money than originally projected. Facebook has another list of 10 most dangerous cities to live in and we are #4.we have to clean up this town before we build anything else.Roanoke a Rapids is an example of city leaders not investigating all issues.City leaders please let us have the right to vote and abide by the voters wishes. Voters should include all people who pay city taxes but not in the voting districts

Event center

Well I can not believe our city leaders want to spend more money than originally projected. Facebook has another list of 10 most dangerous cities to live in and we are #4.we have to clean up this town before we build anything else.Roanoke a Rapids is an example of city leaders not investigating all issues.City leaders please let us have the right to vote and abide by the voters wishes. Voters should include all people who pay city taxes but not in the voting districts

Event center

Well I can not believe our city leaders want to spend more money than originally projected. Facebook has another list of 10 most dangerous cities to live in and we are #4.we have to clean up this town before we build anything else.Roanoke a Rapids is an example of city leaders not investigating all issues.City leaders please let us have the right to vote and abide by the voters wishes. Voters should include all people who pay city taxes but not in the voting districts

It's a done deal....

In my opinion, the decision to construct the event center is a done deal. The demographics of the city alone will make it so. The white membership of the council is comprised of weak individuals who simply go along with the wishes of the black majority. If you doubt that, your attendance at a few council meetings will quickly convince you that it is true. The mayor is a figurehead. A token white mayor that is presiding over the transition to total black leadership. He can easily be voted out of office at the slightest whim of the black voting majority. That's the way it is. At least the center ought to be good for a few NAACP conventions and large family reunions.

Wonder who leaked that report?

Okay about the article, I wonder where that news came from about the 5 million dollars since the Committee of the Whole Meeting is not until tomorrow. Obviously someone leaked that information before the meeting tomorrow. Sure hope they find out and fire them. They could have let the presentation speak for itself.

Why is that important?

Who said this was a leak? What does it matter if it is revealed today or tomorrow? It doesn't change the impact or the economics. It's utterly irrelevant.

Damn!

Did you not read my comment? I said, "I wonder who leaked the information since the meeting is not until tomorrow." Just my damn opinion just like everybody else who post a comment. Did I say it would change the impact of the economics? Hell no I didn't so what is your point? I have not stated anywhere my stand on the Event Center because it would be irrelevant before all of the facts are laid out. But some folks don't want the facts laid out and want to block and stop the report. Once the report is given, then folks can make an informed decision instead of listening and reading those folks who are in opposition to whatever this city council (4-3 black majority) and the black city manager presents to the people. Maybe irrelevant to you but not to me and that is a fact! And not my opinion. So I hope it was not a leak but just maybe Charles Penny gave the information to the papers but that wouldn't make sense.

dancing curly-- How can this

dancing curly-- How can this be revelent to you in any way +being as you are not a taxpaying citizen of Rocky Mount. Vey apparent from your posts that you don't know me.

Go figure!

Now Run & Tell That!

Fired?

But you did say you hope they are fired. How damning and judgmental you are to make such a profoundly damaging wish upon a individual and their career, income and family. What great character you don't have. Obviously.

So you don't think the person

that does something unethical shouldn't be held responsible if found to be true? Oh hell no does not matter because all you are concerned about is what the council and city manager are doing. Oh well! If my opinion is not true then there should be nothing to be worried about.

We have already wasted too much money

Get rid of this monster idea of a convention center now. We have wasted enough money on it just figuring out how much it will cost to build it. Then get rid of Charles Penny and the NAACP influence on the city or we will end up as a bankrupt city.

NAACP

What are you referring to as it relates to the NAACP because I am a member and unaware of what the hell you are talking about.

Maybe you are out of the loop....

Curmilus wrote:
What are you referring to as it relates to the NAACP because I am a member and unaware of what the hell you are talking about.
LOL! It could be you are kept out of the loop of the stuff that involves NAACP high-level political dealings. If that is the situation, it is easy to understand why.

Oh!

Okay! LMBAO!

You bunch of Negative Nellies

Think of all the great concerts we will have. Think of all the concessions. Man, I can probably buy that Blood Sweat and Tears t-shirt I've always wanted (is David Clayton Thomas still alive?). We can have a multitude of conventions and get all the free samples that go with. Just think, all the stuff us rich folks have looked forward to will be OURS OURS OURS and it will be subsidized by the taxpayers of the city. HOW SWEET IS THAT? Charles Penny is a visionary, just saying. Takes off my rose colored glasses and steps off my soapbox.

NO! We Won't GO!

  • IF they build it - will we pay the $50 ticket fee to go? Hell, no.
  • IF they build it - will we pay for it out of our taxes? Hell, yes.
  • IF they build it - and they retire - who is left holding the note? Damn right - we are.
  • Charles Penny is a delusional - sick - twisted fella to think that what the citizens DON'T WANT is his right of passage. His tombstone for Rocky Mount is what it is. The Charles Penny Boondoggle!
  • Beware property owners of Rocky Mount - black, white, Hispanic and especially business owners!!! ACHTUNG!!!

Mr Boddie !

I agree with you 100 percent !!!!!!!!!!

$$$$$

an event center for $37+ million in rocky mount??? not worth it !!!!

Add comment

Login or register to post comments