"Richard L. Lusk, Finance Director,
Financial and Administrative Services Department, City of Greensboro
...was asked...about public funding options for a Greensboro Performing Arts Center.
...the City has about $500M in outstanding bonds each year
with approximately $250M for water and sewer bonds (paid for from
water fees); the remaining $250M General Obligation Bonds are approved by purpose.
...Rick and EFIC briefly discussed other funding mechanisms for a performing arts center.
These included Certificates of Participation (COP).
A COP can be issued by the City Council
and is paid from Hotel/Motel and other non-property based tax revenues.
The difference between [Government Obligation Bonds] and COP
is the approval process and funding mechanism:
the Council votes on the issuance of COPs,
they are not included on the ballot as a referendum
and the Council pledges nonproperty tax revenues to support the debt.
...If a PAC is placed on the ballot as a referendum,
it must include language around a tax increase to fund repayment of bond...
...If a PAC were approved at a $20M bond,
the debt payment would equate to $2M per year for 20 years
or about 1 cent of the current tax rate to support the retirement of the bond
used to support construction of the facility."