For a second year in a row the Washington State Auditor’s Office has confirmed what we already knew… the Town Toyota Center does not generate enough revenues to cover its expenses and debt payments.
The most recent audit, released Tuesday, again knocked the arena for its inability to meet its financial responsibilities and its reliance on the city of Wenatchee to make its debt payments.
The arena’s owner — the Greater Wenatchee Regional Events Center Public Facilities District — was asked after last years audit to address its cash flow issues, but it hasn’t… or can’t.
When the center opened in 2008, officials expected it to generate enough money through ticket sales, fees, rentals and a state sales tax rebate. But so far the center only generates enough money to cover its operating expenses with no real solution in sight.
The Auditor’s Office has again asked the PFD to establish a written comprehensive plan that identifies a long-term financial plan. Auditors stated that it is not apparent to the public what the district plans to do to “proactively” address the situation.
The PFD is trying to refinance the current short-term, interest-only debt to include payment on the principal and has asked the City of Wenatchee to cover the debt payments.
A hearing today in Chelan County Superior Court will determine whether Wenatchee can legally back the arena’s debt for the next 20 to 30 years without exceeding the cities constitutionally set debt limit.
Critical financial decisions are in a holding pattern awaiting the court’s determination. The arena’s governing board cannot refinance the nearly $42 million construction debt unless the city agrees to help make the payments. . At the same time, the Wenatchee City Council cannot map out its 2012 budget without first knowing if and how much it will be paying toward the arena debt.
In the court papers, the arena board has asked the court to dismiss the city’s lawsuit and let the refinancing of the arena bonds move forward, “rather than trigger a spiral into default and the inevitable protracted litigation that would ensue.”
All sides are hoping Judge John Bridges will issue a ruling soon, hopefully today.