by Lynh Bui - Dec. 16, 2011 08:17 PM
The Arizona Republic
Phoenix will spend $1.8 million to retire the $10 million debt that funded an overhaul of the Papago Golf Course.
The Phoenix City Council voted 6-2 earlier this week to spend the funds, giving the city complete control over the course. The investment allows the city to move forward with plans to find a new company to manage the property after Phoenix's first try at outsourcing operations failed.
In 2008, Phoenix outsourced the restoration and management of Papago to the Arizona Golf Foundation's management arm, which secured $12.5 million in financing through the Phoenix Industrial Development Authority. The golf foundation paid $10 million to renovate the course, and Compass Bank issued the bonds to pay for the improvements but had no one to pay off the debt after the foundation filed for bankruptcy earlier this year and went into default.
On Wednesday, the Phoenix City Council voted to retire the debt by buying the bonds for 18 cents on the dollar. "We're getting $10 million worth of improvements for $1.8 million," Councilman Tom Simplot said. "It's a good deal."
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Councilman Bill Gates said it was difficult for him to support spending $1.8 million, but it was a unique opportunity for the city to retire a significant amount of debt.
He said the next step is to consider getting Phoenix out of the golf-management business and possibly outsourcing operations for all courses.
Read more: http://www.azcentral.com/community/phoenix/articles/2011/12/16/20111216phoenix-papago-golf-debt.html#ixzz1gmk93XBu
# posted by Cactus Dave @ 3:09 AM
