The Greater Boise Auditorium District (G-BAD) is tiptoeing around the law once again. This time they are aiming to deprive voters of their constitutional right to approve long term debt for a $38 million dollar kitchen and ballroom.
Article VIII, Sec 3 of the Idaho Constitution requires a vote of the people to approve debt. G-BAD lawyers have formulated a convoluted plan to have CCDC go into debt (which it can legally do), but not use CCDC funds–all on behalf of the auditorium district.
The plan as it stands now is to launder a loan through the Capital City Development Corp (CCDC). The terms of the so-called lease agreement call for CCDC to sell 24 year bonds in the amount of $22 million using the G-BAD credit and ability to repay.
G-BAD figures they can somehow convince a judge through a “judicial confirmation” petition they will merely be leasing the “project” on an annual basis. The project is actually a condominium portion of the new building proposed by the Gardner development group of Zion Bank fame.
The lease agreement blatantly uses an interest and principal component and even bases the rental payments on the cost of the bonds. Those close to the project refer to the CCDC role as a “pass through” which will not use tax money diverted from schools, city, county, and ACHD to fund urban renewal.
In layman terms the deal is like renting a house with the intent of owning it after making payments for 24 years, but using someone else’s credit rating and including a “non-appropriation” clause which says you don’t have to pay the rent.
Even though the intent is to OWN the project after 24 years, G-BAD is asking a judge to find they are not really going to PURCHASE the project, just LEASE it and magically get title at the end.
Ada County Treasurer Vicky McIntyre testified at a G-BAD public hearing last Wednesday and told the board she is a frequent purchaser of bonds on behalf of Ada County, but would never invest in bonds which have a “non-appropriation” clause and call for a third party to ultimately own the project.
GUARDIAN editor David R. Frazier also testified before the board urging them to hold an election as mandated by the constitution. He said the project at $38,000,000 was “so profound it deserves the vote of citizens, not just a single judge.”
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