SUBJECT
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Approve the second amendment to the Interlocal Agreement with the City of Winter Haven for Tourist Development Tax Funding for improvements to the Chain of Lakes Complex. ($2,861,688.74 additional expense over 20 years)
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DESCRIPTION
On October 17, 2023, the Board of County Commissioners unanimously approved the expenditure of Tourist Development Tax funds (as authorized by Section 125.0104, Florida Statutes) to partner with the City of Winter Haven (City) for improvements, financed by bonds or other conventional financing issued or procured by the City, to the Chain of Lakes Complex. Improvements to the Complex include demolition of the remaining spring training facility and construction of four artificial turf collegiate-size baseball fields that are needed to retain the RussMatt Baseball Spring Classic, Perfect Game, Prospectwire and other large scale baseball events which generate more than $60 million dollars in economic benefit for Polk County annually.
The Interlocal Agreement approved by the Board of County Commissioners on October 17, 2023 called for funds to be provided from the Fourth (4th) and Fifth (5th) Pennies of the Tourist Development Tax to make a one-time payment to the City of $5,000,000 within 30 days of execution; and thereafter to service the debt on City Bonds or conventional financing, issued in the approximate amount of $5,000,000, amortized over a 20-year term, at a maximum interest rate of 5%, to finance the improvements to the Chain of Lakes Complex. Subsequent to this agreement the estimated costs to construct the Chain of Lakes Complex have risen due to increased costs of materials, electrical work, water mitigation, and significant increases in earthwork and muck removal. After extensive evaluation by the City and County staff, it was determined that the project would cost an additional $4,000,000. On August 22, 2024, the Tourist Development Council unanimously recommended amending the original agreement to provide $2,000,000 additional in debt service. The City of Winter Haven will provide the remaining $2,000,000. Said annual debt service payments are anticipated to occur on October 1, 2024, through October 1, 2043. The Agreement obligates the City to ensure that: (1) the four artificial turf collegiate-size baseball fields are suitable for the retention and expansion of the RussMatt Baseball Spring Classic and other large scale baseball events; (2) such fields are available, on a long-term basis, for use by the County in sponsoring such events; (3) the completed fields and related support facilities are available for use no later than February 15, 2025 so as to meet the needs of the RussMatt Baseball Spring Classic; (4) Polk County shall have first-priority usage of the fields and receive a discounted rental rate, and (5) the County and the City shall share sponsor revenues.
The new total cost of the project is $24,000,000 with the County and City splitting the cost equally. The City will still be responsible for all facility maintenance costs associated with the completed facility.
RECOMMENDATION
Request Board approve the second amendment to the Interlocal Agreement with the City of Winter Haven pledging financial support and creating debt service obligations, paid for by a portion of the Tourist Development Tax funds, City Bonds or other conventional financing that will fund improvements to the Chain of Lakes Complex.
FISCAL IMPACT
The County’s initial interest payment to the City of $90,296.11 will be paid in FY 23/24. The first principal and interest payments under the amended Agreement will be paid in October 2024 and April 2024 respectively, totaling $459,800. Thereafter, the County’s average annual debt service obligation amount, including principal and interest, is $500,477 for a total obligation of $10,009,546.11 over the 20-year term (2024-2043). Such amounts will be paid from the Fourth and Fifth Pennies of the Tourism Tax Fund and will be budgeted each year of the Agreement term.
CONTACT INFORMATION
Marc Zimmerman
Senior Economic Development Manager
Tourism & Sports Marketing
863-551-4726
zimm@visitcentralflorida.org