History, and Roles & Responsibilities
St. Louis Regional Convention and Sports Complex Authority

History

Created by Missouri State Statute 67.650-67.658 RSMo. – 1988

Enabling Legislation authorized the Authority to raise funds for land acquisition and construction of the Dome through the issue of Municipal Bonds.

The Dome was completed in 1995 on budget and ahead of schedule at a total cost $300 million (bond capital plus interest revenue). Construction was completed without conflicts involving governmental Sponsors or construction entities and achieved an MBE/WBE inclusion of 30%+.

A tri-government Project Financing Agreement between the State of Missouri, the City of St. Louis and St. Louis – 08/01/1991 set forth the terms of bond issuance by the Sponsors and in March 1991 bonds were sold raising $259 million.

Series A (state)- 50%,
Series B (St. Louis County) – 25%,
Series C (City of St. Louis)-25%

In accordance with the Project Financing Agreement annual payments (subject to appropriations) are made by the Sponsors to retire the bonds and facilitate ongoing maintenance and improvement of the Dome through the Preservation Fund.

The Authority administers the Preservation Fund in cooperation with The St. Louis Convention & Visitors Commission to insure that the Dome is maintained in “first class” condition.

Bonds were refinanced in 1993 (state and county) and 1997 (city) creating a refund of over $7,400,000 which the Sponsors and Authority shared equally after refinancing costs.

State and county bonds were refinanced again in 2003 taking advantage of 40 year low interest rates. Refinancing created a refund of $9,400,000 for the state and $5,200,000 for St. Louis County.

City Series C bonds were refinanced in 1997 and 2007. Note: Enabling legislation allows for no more refinancing of the A,B and C Series Bonds.

The Project Financing Agreement was entered into with clear intent to separate the responsibilities of the Authority and CVC. This was a critical element in the bond sale. At that time the State of Missouri would not support the Agreement for the expansion of the convention center to accommodate an NFL team if the CVC (that does not have State representation) constructed, owned, operated and oversaw the facility because:
The State while accepting 50% of funding would have no ability to influence the construction or operation of the Dome.Without oversight of Sponsors, CVC could use the monies appropriated by the State to fund its operating deficit and its assets would be available to satisfy claims of its creditors.

The Dome is operated under a lease Agreement between the Authority and CVC in which CVC is responsible for day to day operation and operating maintenance as part of America’s Center. Under this same Agreement CVC assumes responsibility for the cost of required insurance The Authority maintains oversight responsibility.

The Authority is a party to several agreements, including the Project Financing Agreement which do not provide for the assignment or assumption of the Authority’s duties or responsibilities. Amendment and/or changes to those Agreements, including the Project Financing Agreement, would require approval from the State of Missouri, City of St. Louis, St. Louis County, the Trustee, the insurer of the City Bonds and the Bondholders.

Changes to the financing or operating structure of the Authority could affect the rating and the value of the Bonds.

Authority’s Roles and Responsibilities

By Statute, Inter-governmental Agreements, Lease Agreements, and Bond Indentures the Authority has responsibility to:

Issue bonds to finance the Dome and refinance bonds when appropriate to reduce interest expense through issuance of new bonds.(complete)
Acquire property for purpose of constructing the Dome (statute creating and governing CVC is not permitted by statute to own property or to sell bonds).(complete)
Insure bondholder transactions and Trustee interactions are carried out to fulfill the indentures of the bonds.
Receive appropriations from the Sponsors and administer funds for payment of bonds and application of Preservation Funds.
Direct and oversee design and construction of the Dome.(complete)
Oversee the operation of the Dome and administer the Preservation Fund to insure capital improvements and major maintenance and repairs of the Dome are made in accordance with their intent and also to insure clear separation between Preservation Fund expenditures for the Dome and Convention Center and CVC’s operational maintenance responsibilities
Act as Owner of the Dome. Lease to CVC with sublease to Rams Football.

The Authority, since completion of the Dome, has worked with CVC to develop and implement a long-range plan in order to plan the orderly expenditure of Preservations Funds through the 30 year life of the Dome.(Last revised: 2008)

The Authority conducted a master plan study in 2000 to determine the best uses of Authority funds and to determine deficiencies in the building subsequent to the initial construction of the Dome. These issues have been incorporated into the long-range capital maintenance plan.

The Authority and CVC have reviewed peer facilities and are negotiating with the Rams to ensure the facility is in the top tier (25%) of all NFL facilities by July 31, 2008. Some work (approximately $8.5 Million) has been accomplished. The Authority, CVC and St. Louis Rams agreed to a Second Amendment to Annex 1 of the Rams Lease. This Amendment establishes a $30 million Top Tier Fund to be utilized for building improvements to be completed by July 31, 2009 and formally satisfies First Tier requirements for the first measuring date, 2005. It also formalizes the negotiating process for the 2nd measuring date in 2015.

The Authority has the following On-Going Activities and Responsibilities:
Communicate with Sponsors and legislative bodies to insure support of appropriations process.
Evaluate financial markets for potential saving opportunities through bond refinancing.(no additional refinancing allowed by enabling legislation)
Investments of Funds as appropriate to achieve maximum return.
Interface with The St. Louis Convention & Visitor Commission Board to facilitate seamless operation of the Dome & Convention Center.
Accounting functions, including Preservation Payments and Debt Service.
Certify payments made to CVC from Preservation Fund to ensure they meet requirements of indentures and Agreements.
Warranty Issues-Construction Projects, Contract Review.
Any Construction funded through the Expense Fund.
Review and Oversight of annual Preservation Program funding.
Annual Report to Sponsors and Legislators.
Biennial Financial Audit.
State Audits.
Analyze the Dome and other NFL stadia for “First Class” and “First Tier” status, and coordinate appropriate changes and funding availability with CVC.
Perform “replacement value” study every three years to establish the current “replacement” value for insurance purposes.(last study – 2008)
Insure that Dome is fully insured in accordance with bond indentures & maintain an insurance reserve to purchase insurance in the event of a default by CVC.
Conduct annual arbitrage review and comply with annual verification reporting.
Comply with all Federal and State reporting requirements for municipal tax free bonds.
Monitor potential litigation.
Insure preparation and annual review of the 30 year Master Plan for preservation and upgrade of the Dome.
Coordinate with CVC in preparing the Preservation Long Range Plan and insure that the Plan balances needs and funding.
Make investment decisions to insure the optimum return on all Authority assets.