Chelan County Superior Court Judge John Bridges ruled yesterday that City of Wenatchee would exceed its non-voted debt limit by backing the Town Toyota Center’s nearly 42 million dollars construction bonds. Judge Bridges said the proposed contingent loan agreement would constitute debt for the city saying, “the city’s pledge of its full faith and credit in making loans ... exceeds the city’s rights.”
The Public Facility District does not have the financial means to secure long-term financing without the city’s backing. The ruling puts the PFD in danger of defaulting on the interest-only bonds, and could open the city, which previously agreed to help finance the center, up to a lawsuit.
PFD Attorney Pete Fraley said, “Without the city's backing or some new and significant source of revenue, the district will not be able to pay off the bonds when they come due."
Wenatchee Mayor Dennis Johnson and other city officials who attended the hearing did not want to comment afterward. The PFD board and the City Council scheduled separate meetings for yesterday afternoon to discuss the latest development.