Local view: Arena plans conservative, well thought out
Lincoln Journal Star
February 6, 2010
By Mark Hesser
As the city of Lincoln prepared the arena finance plan - detailed in the Lincoln Journal Star on Jan. 31 - it invited a group of local citizens to review its assumptions. I was part of that group and want to provide more insight into the conservative nature of the city's plan.
City staff members provided a full picture of the revenue sources and cost estimates they used to create the finance plan that leverages private investment, individual donations and visitor taxes to limit the impact on local residents.
On the cost side, it is important to know that each component of the plan includes a construction cost estimate, including engineering and design costs, an adjustment for inflation, a contingency and the cost of bond issuance. Those construction cost estimates were obtained before the current economic recession. Now, the architect for the project and construction consultants reported to us that projects across the country are coming in below estimates.
This committee was not convened to act as a rubber stamp. The city adjusted several assumptions in its finance plan to address issues we asked about. Adjustments to provide extra debt service coverage and additional funding for capital repair and replacements were added.
The city has spent nearly a decade preparing the arena plan. Resident input has been the foundation for this proposal. Voters' calls to minimize the role of taxes in funding the arena have been followed. Residents also have had a big impact on the site plan and design as well.
In summary, the revenue estimates made by the city of Lincoln are conservative, while cost estimates are relatively high and include construction cost estimates from before the economic recession. The result is a plan I am confident will build the arena and surrounding development on time and on budget.
This plan will ensure a bright future for our community. I urge our community to vote FOR the Lincoln Haymarket Arena in May.
Mark Hesser is the president and CEO of Pinnacle Bank, a community bank with locations throughout Nebraska.
