Transit- Meeting Agenda (12/18/1997)

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- ---- . To: ___ Board of D;rectors - ._~ - _ ___._____ _ _ ~ Fmm: Courthouse Square Task Force Date: December 3, 1997 Re: Task Force Recommendations The following are the observations and recommeadations of the Chamber's Courthouse ~quare Taslc Force. In short, the Courthouse Square issue presents substanfial problems for our community. The mistakes made, the constant changes in the "financial models" presented by the County, the newspaper's relentless coverage, and the public's current unrest with elected officials all create a situation with no easy or quick fix solutions. The Task Force has attempted to analyze the project by brealdng down the issue into two key ~~- - rquestions: 1) Is it fin~cially feasible for the Couaty and Transit Distiiot to proceed with Phase II of this project? (As discussed in this report, `~'hase II" would represent the completion of architectural worlang drawings aad all competitive bids for the projcct.) 2) Considering the current political and media climate suirounding this project, can ~e County and Transit District effectively build the project at this time without considerable political consequences? The Task Force did note key mistakes that the pmject team has made. The lack of a competitive bidding pmoess, the micm nag~~t of coutradual agreemeuts, and early financial assumptions based on incomplete and inac:curate info~ion are clearly mistakes that have added to the curreat crisis, However, with the mistakes noted, it was the intent of the task force~to focus on options for the future and not on determining appropriate atonement for past mistalces. Finaacial Feasibility of Courthouse Square Summary; Using the latest inform~tion from the County, the percentage. of square footage to be occupied by public offices would now qualify the e~tire project for financing at the government rate. Consequenfly, we anticipate that the Certificates of Participation issued by the County will have an effective interest rate of less than 6% per annum: Of the total square footage, the County would occupy 99,036 sq. ft., Transit 28,780 sq. ft., and 14,184 sq. ft. would be available for lease to the private~sector aad for future expansion of county needs. Debt service will remain constant throughout a 25 year n~payment term. Thereafter, the County would own its space free and clear. Thus, whea~ meastu~ed against pmsnective lease rates over the same term, the 5xed rate for the debt repayment compares favorably. Therefore, if the Courthouse Square project is built effcienfly, it is financially feasible if the issues of parking and poteatial reduction in o+.her County services are addressed. 43