EL PASO, Texas - The choice to refinance some of the ballpark bonds last summer could save taxpayers nearly $11 million than originally expected back in 2013, said Chief Financial Officer Dr. Mark Sutter.
Although, the city will have to pull money from the general fund to keep paying for the $64 million in debt for ballpark financing for a few more years. The total cost for the ballpark is around $76 million.
The update was given to the Downtown Development Corporation during Tuesday's city council meeting.
The city originally was going to have a balloon payment of $17 million in 2023. But by refinancing last summer at a 3.1 percent interest rate, the city was able to get larger savings.
Thanks to that and the Hotel Occupancy Tax (HOT) going up by approximately ten percent a year, the city projects there will be a surplus by 2020. Sutter said the 2% HOT tax revenue has increased faster than original projections, adding another $6 million dollars to the improved stadium financing projections.
"Before refinancing in 2016, the total excess of revenue over debt service expenditures was projected to be $1,046,000 by the year 2043. With the refinancing of the bonds and the newly projected HOT revenue, the estimated excess of revenue over debt service is now $18,022,000," said Sutter.
He added that the other benefit of refinancing and revised HOT figures is that the new projections show the last annual general fund subsidy to the debt service should occur in 2022 instead of 2024.
In June 2013, city council authorized taking on $60.8 million in debt for ballpark construction. Bonds financing the ballpark were sold in August 2013 with the long-term debt based on an interest rate that was higher than originally estimated. That resulted in the city borrowing about $20 million more than originally anticipated for the stadium.