Quote:
Originally Posted by Kiimo
I am under the impression it's exactly the same as the new stadium, part STAR bonds, part private equity.
Like that Tarwater guy said the Chiefs have to come up with "hundreds of millions".
Anyway, from that site so take it with a grain of salt:
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Thanks for the info, Kiimo. I just saw on the KCTV clip that the proposal does include that $1 billion come from the Chiefs.
https://www.kctv5.com/video/2024/04/...chiefs-royals/
So, I was wrong to say that the proposal was going to rely on STAR Bonds to fund the entire project. Thanks for the additional information.
Still, I would think just using rough estimates about potential revenues from sales tax that it's a very risky bet for investors, unless the total issue of Bonds is somewhere around $1 Billion or less. Like TwistedChief mentioned in his recent post, investors will expect a big interest rate and there might even be some backstopping, the sort of thing that happened when the government stepped in to bail out some previous bad bets made in the finance industry.
One thing that could also happen is that the government sets asides funds to pay off the bond obligation in case the revenues from taxes aren't sufficient. That's the sort of thing that investors might ask for in order to agree to a lower interest rate. Apparently, the Unified Government of Kansas City, Kansas does this for several STAR bond projects, as they discuss this on page 88 of this report on their Long-Term Financial Forecast 2022-2026,
https://www.wycokck.org/files/assets...11-19-2020.pdf Fortunately, they've not yet had to use those set aside funds to pay off investors, but those kinds of deals involving trading risks between investors and the government could spell impacts for "average Kansans".