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Attorneys: Arena bonds need not go to voters
Published 7:18am Wednesday, April 21, 2010The City of Fergus Falls can move ahead and issue about $7 million in general obligation bonds to fund a new community ice arena without seeking approval from its taxpayers.
That’s the word from City Attorney Rolf Nycklemoe and the city’s bond attorney Marry Ippel.
Nycklemoe told the Fergus Falls City Council on Monday that if it approves an ordinance authorizing the Port Authority to issue the bonds the council would be immune from having to bring the ordinance before its voters for approval.
Having the Port Authority in place as the bond issuer would also keep a citizen’s group from seeking to repeal the ordinance because the ordinance levies a tax upon the public and the City Charter does not give the people the power to petition ordinances that levy taxes, he said.
A timeline for moving the arena forward took another step Monday when the city council voted to move forward with the design development phase of the arena and to proceed with the creation of contraction documents that will be used to seek bids for the construction of the arena.
Two weeks ago the council authorized attorneys to begin drafting an ordinance that would allow the Port Authority to issue bonds for the $8.6 million arena.
About $7 million in bonds would be issued because the School District is making an in-kind contribution for use of the land on which the arena would sit. That contribution is valued at $1.6 million.
That ordinance has been drafted, Nycklemoe said, and it is scheduled to be presented to the finance committee on April 28. The city council would potentially hold the first reading of the ordinance May 3 and act on the ordinance at its May 17 meeting.
If the proposed ordinance remains on track, it could become effective on June 4, according to an arena timeline drafted by Finance Director Bill Sonmor. The bonds could be issued in mid August.
