Arena Finance Reform Will Keep Cities' Plans in Holding Pattern
Shafroth, Frank, Nation's Cities Weekly
The arena finance moratorium debacle is looking drearier and drearier for America's cities. It has been noted with interest, that in New York, the home state of the bill's author, 19 such facilities were financed with tax-exempt bonds just before the June 14 cut-off date specified in the legislation.
In an ill-fated attempt to offer relief to specific localities adversely affect by his arena finance reform measure, Moynihan proposed some changes to S 1880-and made most cities' slights even worse, even while it helped several which required specific relief.
Worse, the Senator from New York has clarified his intent to reintroduce the retroactive bill at the beginning of this Congress next January.
What Has Happened
Reacting to the disruption in cities caused by his abrupt and unexpected introduction of legislation, S 1880, the Stop Tax-Exempt Arena Debt Issuance Act, Sen. Daniel Moynihan (D-N.Y.) proposed some changes last week to provide some relief to the cities of Nashville, Tennessee; Pasadena, California; Cleveland, Ohio; Broward County, Florida; and Mesa, Arizona. But the action is unlikely to help other cities. Instead of providing relief for most cities, however, Moynihan's efforts made the problem worse.
Instead of letting his efforts the at the end of this Congress, Moynihan made clear in his revised statement that he will reintroduce the retroactive bill at the beginning of the new Congress next January. That would make the Moynihan bill, which prohibits cities, retroactively, from using tax-exempt municipal bonds to face sports facilities used by professional athletes,
a permanent ban, unless and until Congress acted to lift it and permit cities to proceed as provided by current public law.
As events unfolded it became clear that what Moynihan regards as the federally-mandated good for cities across the nation is not good for cities in New York, where the financing for 19 stadiums financed with tax-exempt municipal bonds (See Box) was issued before Moynihan's retroactive date of June 14, 1996.
The list of protected cities from New York demo how broad the reach of the Moynihan ban on public financing is and how many communities in cities and towns across the country are now or will be affected. The new statement converts a temporary cloud over city financing of sports and recreational facilities to an inpenetrable fog.
Moynihan and his staff have, so far, been unavailable to meet with representatives of state and local governments to discuss their proposal and its impact on the nation's cities.
After Nashville was forced to postpone a $60 million municipal revenue bond sale it had planned to issue to finance the construction of a football stadium and after Pasadena was forced to use a costly, short-term financing mechanism costing as much as $10,000 extra a week to finance work on the Rose Bowl, Moynihan proposed an amendment to his own proposed legislation to provide an escape hatch for cities that had already expended considerable resources prior to the June 14th drop dead date. …